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From Sutlers and Canteens to Exchanges

Soldiers have always sought the comforts of home while deployed in faraway places. The modern exchange service has its roots in the storekeepers and sutlers of the past.

The effect of closing post exchanges on the retention of Soldiers has been the subject of an ongoing debate for several years. Virtually all Active Army, Army National Guard, Army Reserve, and retired personnel and their families use these facilities. But how many of these customers know how the current exchange system came to be?

During the Revolutionary War, each state required its militiamen to furnish themselves with such equipment as flintlocks, bayonets, swords, tomahawks, gun flints, knapsacks, canteens or wooden bottles, and, often, a jackknife. Each brigade had a civilian storekeeper authorized to sell personal wares. The most popular items were liquid spirits, clay pipes, and tobacco.

During the Civil War, a sutler (a licensed merchant) was assigned to each regiment of the Union Army. The sutlers stocked tobacco, liquor (for the officers), rubber ponchos, and stoves for Sibley tents, which Soldiers who had money could purchase. The relationship between Soldiers and sutlers tended to be contentious. Sutlers only conducted cash transactions because Soldiers could die in the next battle or succumb to a fatal disease. Since Soldiers were not paid for months, they sometimes resorted to stealing from the sutler. Both officers and enlisted personnel hated the sutler, who had a virtual monopoly and often took full advantage of this position.

After the Civil War, Soldiers could purchase food or other necessities from a post trader. In the 1870s, Soldiers ate in mess halls, where the type of rations served remained virtually the same over the next 30 years. If they had money or credit, they could supplement their diets by purchasing food from the post trader, who also sold tobacco and alcoholic beverages.

These post stores operated under a franchise from the War Department. Other local merchants were not allowed to compete with the post store. This provided the post trader the opportunity to overcharge for everything since he had a monopoly. On pay day, the post trader sat at the pay table, where he collected the debts Soldiers had run up at his store. Both officers and enlisted men considered the post trader a parasite from whom there was no protection and saw a definite need for reform.

General Arthur MacArthur, the father of World War II General Douglas MacArthur, opened a company “canteen” while commanding Fort Selden, New Mexico, during the 1880s since his post was considered too small for a post trader. This facility provided a place for enlisted men to socialize outside of the barracks. Profits generated from the canteen were used to purchase special food for the mess hall, pool tables, books and magazines, and seeds for the company vegetable garden.

MacArthur pushed to implement this program throughout the entire Army. In 1895, the War Department issued General Order Number 46, which directed post commanders to establish an exchange at every post where practicable. These exchanges were usually referred to as “canteens.”

In Plain Speaking, President Harry S. Truman recounted his experiences as a regimental canteen officer during World War I. He observed that almost none of the canteens generated a profit. Many officers got into trouble handling money. However, Truman successfully operated a regimental canteen for which 1,000 Soldiers provided a total of $2,000 in initial operating capital; in 6 months, it repaid the original investment and earned another $15,000 in dividends.

In 1921, the first centralization of unit exchanges to create a post exchange took place at Schofield Barracks, Hawaii. The post exchange was established to replace all regimental and associated canteens on post.

In 1939, the Army numbered approximately 190,000 Soldiers. It consisted of three divisions in the continental United States staffed at half-strength (15,000 soldiers) and two half-strength divisions located in Hawaii and the Philippines. In 1940, the War Department brought approximately 1 million National Guardsmen and inductees onto the Active Army’s rolls and projected that the total armed forces would expand to approximately 8 million personnel. The existing exchange system would be unable to handle the demands of this expansion. Reorganization resulted in the formation of the Army Exchange Service (AES), which had the mission of providing service to Soldiers in ever-expanding theaters in Europe and the Pacific as well as the continental United States (CONUS). In 1942, AES issued its first catalog, which generated approximately 80,000 orders from overseas troops.

Following World War II, AES remained to support occupation forces overseas. Nearly 80 new exchanges were needed to support the needs of Soldiers and their dependants. In 1950, AES was again reorganized to form the Army and Air Force Exchange Service (AAFES). In 1952, mobile exchanges began operating in forward areas in Korea. Post and installation commanders had operational control and responsibility for exchanges that operated on Army and Air Force installations in CONUS. The Vietnam Regional Exchange was established in 1965, and the mobile exchanges developed during the Korean War evolved into tactical field exchanges (TFEs). The TFEs were operated in areas with no AAFES operations. In 1970, based on favorable results from a 1-year test, AAFES assumed operational control and responsibility for all Army and Air Force exchanges operating in CONUS.

Today, AAFES has a website and customers can order over the Internet. In 2005, AAFES revenues were $8.7 billion, which ranked it 83d among the world’s top 250 retailers. It has more than 45,000 employees operating out of approximately 3,100 facilities in more than 30 countries. It serves nearly 12 million eligible customers, including active duty, retired, and Reserve component personnel, military families, and some Government employees. AAFES operates theaters, libraries, convenience stores, and even gas stations. It also has partnered with a variety of commercial food outlets, such as Taco Bell and Baskin-Robbins.

AAFES has had an interesting evolution from civilian storekeepers accompanying militiamen during the Revolutionary War to current online web operations. However, the basic mission has remained unchanged: Provide the men and women of the armed forces and their families with service and merchandise they need to make life more comfortable.

James T. Delisi works part time for a nonprofit organization. He retired from Federal Civil Service as a management analyst with the Army Forces Command. He also retired as a lieutenant colonel in the Army Reserve. He has a B.A. degree in political science from Duquesne University and an M.A. degree in business management from Central Michigan University.