Jason Lorgan Rental Presentation

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UNIVERSITY OF CALIFORNIA, DAVIS
“You can be the low price leader!”
Shelf Tag Example
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Bookstore market share – 40-50%
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The near-monopoly days are over, but things are
still good!
What other industry can boast those figures?
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We need to re-shift our focus.
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Let’s not strive for something unsustainable.
Let’s step away from the gloom and doom.
Let’s figure out how to be competitive.
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Price Competitively & Offer In-Store Rental
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How to price competitively:
Offer rental on as many titles as possible
Jason
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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
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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
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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
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Offering in-store rental:
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In-store rental puts you in the
Jason
game.
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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.
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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
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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
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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
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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
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Please note this formula allows us to maintain our
EXISTING margins in dollars
In other words, rental and purchase margins are
identical in dollars
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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
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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
[email protected]

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