The Navy Exchange Service Command, the retail network that has served American sailors and their families for generations, is losing ground to Walmart, Target, and Amazon at a pace its own leadership calls unsustainable. Sales hit their lowest point in two decades last year, and the system's more than 300 stores now face a fight for survival that could erode benefits military families depend on every day.
Nexcom CEO Robert Bianchi did not mince words about the scale of the challenge. In a report from The U.S. Sun, Bianchi laid out the competitive squeeze facing an institution that operates over 300 retail locations worldwide and generates more than $2 billion in annual sales, numbers that sound healthy until you learn they represent a 19% decline between 2012 and 2024.
The most recent data, collected in 2024, showed the lowest sales Nexcom has recorded in 20 years, with the sole exception of the coronavirus pandemic. And the 2025 figures have yet to be released.
What makes this different from another retail-decline story is where the money goes. Profits from Navy Exchange stores do not flow to shareholders. They fund morale, welfare, and recreation programs across the Navy, gyms, day cares, counseling services, and community events for service members and their families. When sales drop, those programs lose funding. The stakes are not abstract.
Bianchi framed the risk in those terms:
"What is at risk is potentially the degradation of this benefit for all those military members and their families around the world and so that's why we take this very seriously..."
That is the real cost of the decline, not just shuttered storefronts, but fewer resources for the men and women who serve.
Navy Exchanges offer discounted, tax-free merchandise. On paper, that should be a powerful draw. In practice, it is not enough. Bianchi acknowledged the reality bluntly:
"Even though we're within the military, we compete for people's share of wallet, right? They can just as easily...stop at a Target, they could stop at a Walmart, but we want them to shop here."
The problem is convenience. A sailor stationed at a large base in California, Florida, or Virginia can drive off-post and reach a Walmart or Target in minutes. Amazon delivers to the door. The exchange, meanwhile, operates on limited hours and often in aging facilities.
Navy veteran and Nexcom customer Angela Emerson put it plainly: "They have good things at the exchange. I don't have a problem with what they carry...but it's just the convenience." She added a line that captures the entire competitive gap in four words: "Amazon's never closed."
The broader retail landscape only makes the picture grimmer. Experts estimated 15,000 store closures in 2025, more than double the prior year's figure and the highest total since the pandemic. The list of chains shutting locations reads like a directory of American shopping: Macy's, JCPenney, Kohl's, Nordstrom, Walgreens, CVS, Rite Aid, Forever 21, Foot Locker, Gap, Big Lots, Dollar General, GameStop, Best Buy, and Regal Cinemas, among others. The wave of retail closures heading into 2026 shows no sign of slowing.
If major civilian chains with massive marketing budgets and sophisticated supply chains cannot hold their ground, a government-run exchange system faces even steeper odds.
Nexcom's network includes everything from full-size retail stores near major stateside bases to tiny outposts in remote corners of the world. A Navy Exchange Mini Mart in rural northern Poland, near Redzikowo, serves roughly 150 sailors and their families. It does not bring in much revenue on its own.
That small shop exists because bigger stores in California, Florida, and Virginia generate enough surplus to subsidize it. The model works only as long as the large locations stay profitable. When stateside sales slide, dragged down by competition from Walmart, Target, and Amazon, the money that keeps a Mini Mart open in Poland starts to dry up.
This is the structural vulnerability at the heart of the system. Nexcom does not get to choose only profitable markets. It serves sailors wherever the Navy sends them. That mission requires cross-subsidization, and cross-subsidization requires healthy anchor stores.
The pattern mirrors what is happening across American retail more broadly. Multiple major chains have announced plans to close hundreds of U.S. locations, often starting with lower-performing stores in smaller markets, exactly the kind of triage Nexcom cannot afford to replicate without abandoning service members overseas.
Nexcom is not standing still. In 2020, the command hired retail consultant Melissa Gonzalez to redesign locations and launch a "Store of the Future" initiative. Over more than five years, Nexcom invested $20 million in store updates. Leadership now wants to spend an additional $80 million over the next three years, bringing total renovation investment to $100 million.
In July 2024, Toys R' Us parent company WHP Global reached an agreement with Nexcom to add miniature Toys R' Us stores within exchange locations, a shop-within-a-shop concept aimed at drawing military families with children.
There are early signs of progress. Customer satisfaction is up 2.7%, a modest but measurable gain. Whether that translates into higher sales remains an open question. Satisfaction surveys and cash registers do not always tell the same story.
Bianchi described the daily pressure in terms any small-business owner would recognize:
"The pressure is there. I feel it, you know, and just like a retailer, we watch our sales figures and every day we're looking at our retail trends."
He also offered a candid assessment of Nexcom's broader position: "It is a constant challenge to stay relevant."
Nexcom's troubles do not exist in a vacuum. The same forces squeezing the Navy Exchange are reshaping the entire American retail map. Macy's has extended its store-closure timeline through 2028. Pharmacy chains are pulling out of communities wholesale.
Several companies have already announced closures this year, including Macy's, Kroger, Yankee Candle, Saks Off 5th, REI, Walgreens, GameStop, Carter's, and Foot Locker. Both Walmart and Target are making major changes heading into 2026, with new CEOs at the helm of both retail giants.
The civilian retail world at least operates on market logic: close unprofitable stores, consolidate, and move on. Hundreds of pharmacy closures nationwide follow that cold calculus. Nexcom does not have that luxury. Its mission is tied to wherever the Navy plants a flag.
At 92 Navy base locations and counting, the exchange system stretches across the globe. Every store that loses money still serves a community of sailors and families who may have no other shopping option within miles, or within the same country.
The headline risk is store closures. The deeper risk is the erosion of a benefit that military families have counted on for decades. Tax-free, discounted goods and the programs funded by exchange profits are part of the compact between the nation and the people who defend it.
When retail spaces across America are being repurposed as traditional outlets vanish, the question for Nexcom is whether $100 million in renovations and a miniature Toys R' Us can hold the line against the convenience of Amazon Prime and the pricing power of Walmart.
The 19% sales decline over twelve years did not happen overnight. It happened one transaction at a time, as military families made the same choice millions of other Americans made: they went where shopping was easiest. Reversing that trend requires more than fresh paint and new floor plans. It requires a system that respects how people actually live and shop, something the private sector figured out years ago.
America asks a great deal of its military families. The least it can do is make sure the institutions built to serve them can keep the lights on.