This Army cannon-cocker thanks you for your service.
Your post holds a great economic truth about the government not doing something that could be done better by private enterprise. Applying that to the exchanges just because WalMart is outside the gate overlooks two things. The exchange is a non-appropriated fund (NAF) activity thus no taxes are expended for its operation. Additionally, purchases at the exchange generate morale, welfare, and recreation (MWR) funding that is distributed down to unit level for functions that meet the title description. Ending the exchanges means those funds go away along with the nice things they used to buy for the troops.
I don’t see WMT setting aside a portion of sales received from military families in order to fund MWR activities. They would rightly say they already pay taxes without understanding the reality of how MWR funds come from non-tax sources.
As examples, I would point to the countless fast food restaurants operating on military bases with their own employees, materials and supply chains. Prior to their appearance, the exchanges ran their own canteens with their own employees, equipment and supply chain. While necessary until fairly recently, the system was downright Soviet in its offerings and has become more economically inefficient over time. Today's on-base franchises are contracted to pay a portion of their revenues to MWR, so everybody wins.
Exchanges and commissaries are just as antiquated and inefficient in today's economy, and there is no reason that private companies cannot deliver better for less. Large retailers (WalMart is just one example) have much greater buying power than all MWR activities combined, and have much more efficient logistical systems than the thinly scattered MWR system. The MWR funding that you rightly highlighted can be written into the contracts, just as it is already done with other private MWR vendors.
Here is another guiding principle: Whereas competitive businesses are constantly evolving in order to compete, government institutions perpetually resist efficiency and always devolve into fiefdoms for their employees. Count the double dippers at MWR and I'll rest my case.