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New Books at Used Prices
05/07/04
Keith Penner gets excited when he talks about an innovative, yet controversial concept to improve college bookstore sell-through by offering new textbooks at used prices. The textbook director at The Co-Op Store, Indiana University of Pennsylvania, Indiana, PA, offered during his ConTEXT session that the business model he and a colleague developed is a viable way to offer textbooks at lower prices, help publishers increase their sales, and still maintain a vibrant used book department."I'm suggesting that publishers compete with wholesalers on their own lists," Penner said. The hard part is getting publishers to buy into the idea, he conceded. Plus, his idea is risky for wholesalers. "My view is that competition is good for college bookstores," he said.
Currently publishers sell most of their new textbooks in the first year of a multi-year of the edition cycle. "But if publishers are willing to sell new copies of a text at the used book price after the first year, this would be more desirable to me," Penner said. "Plus, the publishers would realize sales that otherwise would pass them by in subsequent years."
Here is a current typical sales pattern over a three-year edition cycle:
In Penner's new concept, publishers have the opportunity to sell more of a title by matching the used-book wholesale price in the second year and beyond of an edition. While publishers will make fewer dollars per unit, theoretically they will sell more units. What this does, he said, is increase revenue for publishers, reduce the rate of inflation for new books, and thereby keep prices lower across the board.
According to Penner, publishers have said that the bulk of the cost of a new book is on the front end for content, and that on average printing, or reproducing, a single book is less than $10.
Penner, who tested his concept with three publishers during the winter semester, said with his new model his store achieved a 96% sell-through. Typically the store had an 80% sell-through, he said. The Co-Op Store will continue the test this fall with at least one other publisher, he said.
Also testing the concept is Scott Franz, a textbook manager at Gonzaga University Bookstore, Spokane, WA.
Anyone with questions can contact Penner at (724) 357-3139, or at kpenner@iup.edu.
—Yalinda Moore
Sound Off!
Usman Ali Akbar (usmanaliakbar@hotmail.com) 10/10/2005 3:39:07 AM
hi there: I am interested in buying books for a library of various subjects - graduation level
mainly
Electrical Engineering
Computer Engineering
Computer Sciences
Management Sciences
Maths
Physics
please send me the details of the books with prices.
Scott Chapman (schapman@asucla.ucla.edu) 5/10/2004 10:48:42 AM
New @ Used pricing is a great way to create special deals for your students. We started our program this Spring quarter and have had moderate success so far. I'm looking to Fall to see the full results as word spreads.
My feeling has always been that there is always a better deal out there for students willing to spend the time looking the world over. If I can provide bargains here and there, I can hopefully win over the majority of students. I applaud the publishers who are willing to be creative in this time when there is so much focus on textbook pricing.
Keith Penner (kpenner@iup.edu) 5/7/2004 4:53:18 PM
In response to Brian's comment.
Buyback is sacrosanct. The way I have run this program is to buyback as I normally would. The books that are offered at N4U are books that would otherwise be sourced to a wholesale vendor.
The used book price does NOT drop below the new book price as you cite. In effect, new books and used books are sold at the same price in years 2 and 3. Students think of both options as a discount from the normal price, not in relation to one another.
So in your example above, year 2. Books are bought back at $50 from student, and purchased at the same price from the publisher. Books are not purchased from a wholesale company.
NACS has been kind enough to publish my thoughts in greater detail at:
http://www.nacs.org/public/events/ccracontext/
jim ladd (laddjim@fhda.edu) 5/7/2004 4:19:39 PM
Students do not normally buy a textbook with the buyback value being the primary concern. They are interested in getting the product as cheap as possible with as little hassle as possible. So, I do not think potential buyback value is someting about which I would be concerned over the price charged at the register.
While Pearson has offered us absolutely no titles to work with, several other publishers have been willing to wheel & deal on their "overstocked" titles. We have had excellent, and sometimes confused, responses from students to our "New at Used" pricing. We almost do not need to buy offshore ... almost. No vendor will negotiate with you if they think they don't have to. It's called maximizing commissions.
We also make a very big point about this new pricing structure, and with POP signage cite the publisher who worked with us to bring in books this cheap. I'm not sure whose pocket this is coming out of, but it will have an impact on the used book industry and buybacks. We don't buy the title in used condition, if we can get the same pricing and margin for a new book.
In fact, I have one annecdote where the student allegedly made a profit buying the book from us, using it all quarter, and selling it to someone else on one of those auction sites.
To all the publishers' reps who are doing this, a giant "Mahalo (thank you)."
To everyone else, college stores have options and the acquisition of offshore books is NOT illegal despite the marking on some covers. We just place a sticker on these books citing the supreme court case that explains and contradicts the claim that the books are "not for sale in North America."
The world is changing and I agree that businesses must evolve, or fade away. The question is: "Into what will we evolve?" Any futurists out there?
Brian Freese (bfreese@iusb.edu) 5/7/2004 1:32:25 PM
If I am reading correctly, this will only save the student money if the wholesaler also drops their price. I am not sure that would happen; especially, if the wholesaler has already spent a higher amount purchasing this book during the first year.
EX: year 1: New book retail $100, used book retail $75
year 2: New book retail $75, used book retail would depend upon wholesaler dropping price or store not making margin on books purchased from wholesaler. Also, would this mean less money going to student at buyback.
Carol Miller, CSP (carol.miller@ndsu.nodak.edu) 5/7/2004 10:08:05 AM
We are also doing a pilot program with Pearson on a fall textbook. My main goal is to get books to students as inexpensive as possible. I am glad we are being given this opportunity to provide new books at used prices.
Carol Miller
Director
NDSU Varsity Mart
North Dakota State University
carol.miller@ndsu.nodak.edu
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