Long-time collegiate retailing professional gives advice on how college bookstores can succeed in challenging times.
The 2020-21 school year is likely to be one of the most challenging college bookstores have ever faced. They will be under more pressure to return value than ever before as their parent institutions face massive revenue shortfalls. So how do stores make sure they remain relevant?
Shopping in person at the bookstore is like a right of passage and something many college students still do and even enjoy. Unfortunately, social distancing is going to prevent anything resembling a normal rush for most stores who may be under strict guidelines to maintain limited customer and employee counts. One critical value proposition of college stores, convenience, will be questioned. The rush period, when many stores make the majority of their revenue, could easily break them if they don't seize the opportunity to improve and expand their services.
College bookstores across the country will need to find new ways to do business, become even more essential, and more convenient. Stores can keep themselves relevant by improving the student experience and leading their institutions by creating new and innovative programs. Now is not the time for passivity. Put your foot on the gas. Here are a few ways to do that.
Allow Students to Put Their Bookstore Purchases on Their Bursar Bill
Giving students the ability to put purchases on their school bill is a game changer. It can increase a store’s gross revenue by twenty percent or more. For students, it simplifies a process that can seem overwhelming. Any store that does not offer their students this convenience should pursue it immediately. It’s a win for the bookstore and a win for the student and the institution. It gives the bookstore an advantage that online competitors don’t have. It’s the college bookstore’s version of the One-Click purchase button.
While most ERP systems handle Bursar billing, many institutions end up marginalizing some groups of students who rely on financial aid or scholarships to purchase their course materials. Every bookstore employee knows that there is a specific group of students who wait in a lot of lines because they don’t have easy access to the funds to pay for their course materials.
The way most ERP systems handle the issue of financial aid is to create files of some kind, which require manual processing. Large stores that have their own IT departments and their own Accounting departments, have labor to throw at this problem. They create interdepartmental invoices. They make journal entries. They create batch files that they send to the Bursar's office. Many other stores do not have the labor to perform these extra support processes. Heck, they barely have the labor to run enough cash registers.
A company that bridges the gap between financial aid and easy student access is Watchman Payment Systems. Watchman provides stores with a more efficient way to process financial aid transactions and has potential to create even more convenience for students as well as labor-savings for the store. Their unique service is underutilized in college stores and can provide a vital function, creating a major convenience for an at-risk segment of the student population. Partnering with Watchman is a sound bet for the future because it establishes a conduit for solving other financial aid access issues.
The Biggest Challenge
Implement an Inclusive Access Program
Many university administrators lack confidence in their college bookstores to handle and implement technological innovation. It’s not too late to establish an inclusive access program, which is the digital delivery of course materials through the learning management system that automatically bills all the students in a course to their Bursar bill. It is essential that stores not only have an inclusive access program, but fully understand the vast possibilities of digital course materials delivery. To do so makes your store a leader on campus.
While there are many companies that help stores manage their inclusive access programs, Verba Software and Redshelf are two of the best. Although these companies are competitors in the same space, I've never heard an employee at either company say a bad word about the other. They're not only companies that deliver important services, they're both full of great people and you can tell they care about what they're doing and not just focusing on selling you something. Either one can launch a successful inclusive access program.
Because it’s essential to make your inclusive access program work from the start and produce data to support expansion, focus on large courses with low sell-through that use titles from major publishers like McGraw-Hill, Pearson, and Cengage. The larger publishers are more experienced with inclusive access and deliver a very good experience to both students and faculty. If you're hesitant about jumping in with both feet, just concentrate on providing proof of concept. Find a large course and a faculty member that's willing and go for it.
Start a Textbook Rental Program
You might think it’s too late to start renting textbooks. It’s not. Despite the increasing emphasis on digital, somewhere between 40% and 60% of a store’s course materials are still only available in a physical format. Offering a low-cost option for these titles can turn your store into a destination that will increase revenue in course materials as well as traffic and sales in categories other than textbooks.
More revenue and more student savings can be generated by a store-owned rental program provided that your campus has more than 40% of its titles re-used over the course of an academic year. With our rental program at the University of Colorado Boulder, we frequently beat Amazon’s rental prices on a core group of titles that were consistently used semester to semester. Even just focusing on a limited number of core titles, stores can increase customer demand dramatically. In many first-year courses at the University of Colorado Boulder, we had over 90% of our students renting books because the prices were so appealing and the convenience so great. Rental textbooks increase store traffic. It's as simple as that.
If you can’t start a store-owned program, then talk to one of the wholesalers about partnering with them. It can change customer perception about your store almost overnight.
Improve Order Fulfillment Infrastructure
It’s possible that every college store in the coming year will provide 100% of its course materials sales online at some point, be it for a few days, weeks, or months. Your web site and your infrastructure need be able to handle that demand. If it’s broken, fix it now.
Infrastructure issues can be fixed with student labor. I didn’t always believe this, thinking for a long time that student transience made assigning them certain jobs risky. However, after watching the students run our Order Fulfillment department (overseen by a very capable manager), I’m firmly of the opinion that they can do anything with good training. Given the number of employees that may be required to pick every purchase made in your store, students are really the only realistic labor option.
Believe in your students, train them well, and they will reward you with years of good service at the level of any other employee. Give them management responsibility and they will train their fellow students and reduce your labor and benefit costs.
Source Textbooks Online
There’s no question that college stores can lower the cost of their physical course materials by ordering directly from Amazon and bypassing the wholesalers. For many stores, it’s probably worth examining high-value, large quantity titles and the price difference offered on Amazon's marketplace compared to the wholesalers. In some cases – older edition law books being one good example – the difference in price is so great it is worth figuring out how a store can order directly from Amazon efficiently. When purchased during low demand months like April and May, certain titles can be unbelievably cheap.
Unfortunately, the process of ordering, receiving, and reconciling books ordered online is expensive and can require an extraordinary amount of labor and logistics that many stores cannot handle because they don’t have enough flexibility or enough available labor. The recent push by publishers to uncover counterfeit books has made the process even more complex.
There are many companies that source books online for the college bookstore and they have become considerably more cost-effective in the last few years. Those companies also guarantee against counterfeits, so turning to one of them to acquire more titles from the marketplace is a reasonable and cost-effective option.
One of the best programs out there for sourcing online is Simplesource, which is from MBS, one of the country’s largest used book wholesalers. It’s a tool where you can send a wantlist to MBS and then control how much of that wantlist MBS sources from the marketplace and at what percentage off retail. Obviously, they take some amount of revenue for each book they purchase for your store and the books they purchase from the marketplace are not returnable. However, the discounts they provide are significant, so if your store can send wantlists early in the ordering cycle and allow MBS to work them for a month or more, the fill-rate and the savings are impressive. Across a large order, MBS is able to source more books from the marketplace than any buyer could. Ultimately, the savings combined with the reduced labor is well worth it. Simplesource is an outstanding tool that works as advertised and increases efficiency dramatically.
Ideas, change, and innovation are going to be coming at college bookstores from every direction this fall. Make sure you're leading and not following. With these five ideas, you'll be sure your administration knows your value proposition and essential role on campus.
What is Your Next Step?
© 2020 Jason Katzman
hirecollectionagency on July 07, 2020: