Strategic Lessons and Compendium of Tactics for Increasing Nontraditional Operating Revenue
Imperative #4: Leverage Scale to Create Beneficial New Markets
Offering a Variety of High-End Retail Options to Students
The goal of imperative #4 is to leverage the institution’s scale to achieve a critical mass of inventory or buyers (or both) to fuel a new market that benefits the campus.
One channel for building a critical mass of buyers is the student body. For example, UCLA has found a way to benefit from the food truck craze. They contract with 21 local vendors for exclusive rights to sell on a parking lot in central campus. UCLA leaders also promote the trucks through official student communication channels. In exchange, vendors provide UCLA 15% of all sales, totaling $75,000 in annual revenue. Increased food truck usage has also allowed UCLA to delay a $15 million upgrade to student dining facilities.
Other colleges and universities have successfully applied the same concept to create on-campus clothing sales. Rotating vendors bring merchandise to campus, providing a percentage of sales to the institution and often a slight discount to students. Note, while food trucks are likely an option only in urban locations, clothing sales are applicable in any setting.
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University of Wisconsin’s SWAP Program
Another approach for creating markets is to use goods the institution already has. The University of Wisconsin-Madison successfully applied this tactic with office furniture, computers, and lab equipment. Leaders found that every department had excess office and lab supplies. But few attempted to sell unwanted goods, as volumes were too low to generate meaningful dollars or justify staff time.
By consolidating goods into a central location, the Surplus with a Purpose (SWAP) program created a large enough inventory to support a successful resale store on campus. The store is open to university and local school district employees on Thursdays and the general public on Fridays (when a small premium is charged). SWAP has also expanded to online sales, showcasing inventory on their website and hosting some online auctions.
To encourage departments across campus to participate, the program is low-effort and easy to use. SWAP staff pick up and transport all goods several days each week. As further incentive, 25% of item sales are returned to donating units.
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Imperative #3: Seek Out Stealth Advertising and Leasing Opportunities
Compendium of Alternative Revenue Tactics