UNIVERSITY OF CALIFORNIA, DAVIS “You can be the low price leader!” Shelf Tag Example Bookstore market share – 40-50% The near-monopoly days are over, but things are still good! What other industry can boast those figures? We need to re-shift our focus. Let’s not strive for something unsustainable. Let’s step away from the gloom and doom. Let’s figure out how to be competitive. Price Competitively & Offer In-Store Rental How to price competitively: Offer rental on as many titles as possible Jason lorgan – uc-davis BOOKSTORE You need to have the biggest impact on the large enrollment titles. 80% of your sales probably come from 20% of your titlespricing that 20% competitively is important. Don’t try to have the lowest price on all items; no one retailer in any industry can do that. What books do you need to price competitively? Newer editions- much easier to compete on these titles High volume titles Jason lorgan – uc-davis BOOKSTORE Jason lorgan – uc-davis BOOKSTORE In addition: Don’t have to reinvent the wheel to choose your prices lorgan – uc-davis BOOKSTORE There are tools out there to help you price and show students online price comparison Jason Verba Compete and Verba Compare Integrated with MBS Text Applications Integrated into MBS Systems inSite e-commerce product Can be used with other college store management systems as a stand alone product Rental price comparisons are available with this product Offering in-store rental: In-store rental puts you in the Jason game. lorgan – uc-davis BOOKSTORE Your store is the LOWEST price option a student can find on most titles you rent. A lot of stores think you have to sacrifice margin when you offer rental, but you don’t! Many stores, including UC Davis, achieve the same gross margin with rental as with purchased books. UC Davis has partnered with Follett, MBS and Nebraska. Currently an agreement with Texas Book Company is in our Business Contracts Office The more wholesaler programs you sign up for, the more options you have and the larger program you can develop Recommended to supplement an in store rental program Can be done without an in store program, but your margin will be significantly less Chegg, Bookrenter, Follett are the most common Send a title list via spreadsheet or your management system to the wholesalers They will respond with a rebate amount for each title If more than one vendor supports a title for rental, if you pick the highest rebate, your price will be the most competitive UC-Davis rental price formula: New Retail - Wholesaler Rebate = New Rental Price lorgan – uc-davis BOOKSTORE Used Retail - Wholesaler Rebate = Used Rental Price Assuming a $100 New Retail, $75 Used Retail and $46 Rental Rebate…. $100 New - $46 Rebate = $54 New Rental Price $75 Used - $46 Rebate = $29 Used Rental Price Jason Please note this formula allows us to maintain our EXISTING margins in dollars In other words, rental and purchase margins are identical in dollars UC-Davis Bookstore Rental Overview: Fall Quarter 2010, we rented 246 titles lorgan – uc-davis BOOKSTORE Winter Quarter 2011, we rented 350 titles Spring Quarter 2011, we rented 426 titles Fall Quarter 2011, we rented 930 titles Winter Quarter 2012, we have set a goal of 1400 titles UC Davis averages 2300 titles per quarter Jason The fear of going into rental was worse than the reality. Recent Systems Rental enhancements has made the process much easier! Look at how much our students can save! Jason Lorgan 530-752-9075 jplorgan@ucdavis.edu