The Operation of Military Clubs and Alcohol Package Stores

In a comprehensive review of the management and operation of the military club system and related alcohol package stores, the club system was examined to identify ways to improve the delivery of needed services and the operating results for clubs and package stores were evaluated for fiscal year 1977. Changes are needed in the operation of the club system because military clubs are generally losing money from operations, are not effectively meeting the needs of active duty personnel, and the present management system has not resulted in needed improvements. Military clubs and alcohol package stores constitute a major business enterprise, with gross revenue from sales amounting to $68 million in fiscal year 1977. While package store operations usually result in significant profits, clubs are generally not self-sustaining. Clubs and package stores receive appropriated fund support, membership dues, and slot machine profits. In addition to these, clubs receive a great portion of package store profits. Without these supports, the military club system would eventually face bankruptcy unless significant management improvements are made. Package store profits and appropriated fund support serve as disincentives to achieving efficiencies and economies in club operations. Many military personnel never use the clubs because of poor atmosphere, poor entertainment, and unsatisfactory service. Club management could correct these negative aspects of club operation. The relatively low patronage and poor financial condition of many clubs indicate that the club system may not have adequately adjusted to the changing military environment; therefore, the morale, welfare, and receation program objectives are not being met, and tax dollars are being used to support certain club operations with questionable value. Management problems include the managers being subject to the policies and desires of the local installation commander, and military rotational policies which result in a loss of valuable experience and insight into the specific needs of clubs and their patrons. It is believed that a strong central management system would help ensure that the military club system is administered in a businesslike manner.