Facing falling revenue, UNC-Chapel Hill considers outsourcing, digitizing bookstore

School considering between several proposals

In a move reflective of a national trend, the University of North Carolina-Chapel Hill is considering outsourcing its bookstore and moving to an online-only model for texts.

Revenue from UNC Student Stores used to support need-based scholarships on campus. But as at many schools across the United States, UNC bookstore revenue has fallen significantly, from $29.2 million in 2006 to $25 million in 2015. Now, the institution must turn to other sources to fund the scholarships.

Last year, the for-profit company Follet proposed a deal to take over the stores and increase revenue by millions of dollars. The school had a "fiduciary duty" to consider the unsolicited proposal, says A. Bradley Ives, associate vice chancellor for campus enterprises.

Since then, the school has received seven other proposals—including one from UNC Student Stores. UNC-Chapel Hill will hear each in late March, and Ives says they will likely make a decision in April. 

From Research and Insights: Considerations for outsourcing the university bookstore

Three of the proposals would keep books in the campus store, while five others suggest creating a virtual store and a central location where students would pick up their texts. The on-campus store space could then be used for more packaged goods and apparel.

The University of Massachusetts-Amherst moved to that model last fall when it partnered with Amazon. About 100 schools have shifted to an online-only model as students buy fewer textbooks from campus bookstores, says Edward Schlichenmayer, deputy chief executive and president of indiCo, a branch of National Association of College Stores.

The privatization move sparked protests from students and store employees in November, when about 100 urged school officials not to "sell out." Employees would likely retain their jobs but may lose state benefits. 

Campus bookstore reinvents itself as town square

Schlichenmayer has been helping UNC Student Stores craft its proposal. He says the group is saddled with debt from remodeling five years ago—but the stores themselves are still self-sustaining. He says they are exploring rebates from vendors, reducing inventory, and restructuring debt.

Outsourcing campus bookstore operations limits inventory flexibility, he says. Institution-run stores can work much more closely with professors and campus organizations. For example, it is easier to customize course materials and personalize merchandise under a campus-run store.

"Campus bookstores do a lot of things to weave themselves into the fabric of the campus," Schlichenmayer says. "And that could potentially go away when it's corporately managed" (Ruff, Chronicle of Higher Education, 2/25). 

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