Textbook case of economics - Students pay big, but stores profit little
WVU students will spend thousands of dollars on textbooks
this week for the spring semester, but the bookstores will
make only modest profits.
"When the price of college textbooks is broken down
per dollar, you can see that the bookstores don't make a
lot of money," said Keith Fleming, the store manager
of the Book Exchange, on Patteson Drive.
"The publisher is really the one who gets the most
money out of every transaction. Bookstores don't make a
big percentage of sales -- not at all."
John Stevens, 26, a WVU graduate student, said it doesn't
matter who gets the money, books are expensive.
"I love to pay high prices for anything," said
Stevens, with a touch of sarcasm. He expects to spend at
least $400 on books this semester. "Makes everything
worth it. You know you have quality when you pay high prices
for books."
Using numbers from the National Association of College
Stores, Fleming said, on average, a college bookstore makes
about a nickel profit out of every dollar of textbook sales
-- about $5 for a $100 book. The store's overhead costs
consume about 11 cents out of every dollar. The publisher
gets about 65 cents per dollar of sales (7.1 cents of that
is profit), while the author gets about 12 cents.
For example, a standard biology book used by most students
as part of their general college requirements costs $129.45
new.
Charles Schmidt, director of public relations at the National
Association of College Stores, said based on industry standards,
the publisher's share for that book is $84.27 -- about 65
percent of the sales price. The publisher's share covers
the cost to produce the book, general and administrative
expenses, marketing costs and profit.
Schmidt said the bookstore's share of the $129.45 sales
price is about $30.03 (23.2 percent). The bookstore's share
covers costs to pay employees, shipping and handling expenses,
general overhead and profit.
The author's share of the sale price is $15.15 (11.7 percent).
Jennifer Liberowski, NACS spokeswoman, said faculty have
the option of selecting cheaper books, but opt for quality
instead of price.
High prices
"I definitely think books are too high," said
WVU student Johnny Applegate, 26, who has spent $150 for
textbooks so far this semester.
Fleming said at least 15,000 customers would purchase textbooks
this week at the store, which has 7,000 titles. Books sold
range from a paperback novel written by Charles Dickens
to a biology book in its seventh printing. The average student
will spend at least $350 on books this week.
"We will sell tens of thousands of books this week,"
Fleming said while processing orders for a long line of
customers.
Fleming said used-book prices are cheaper because the publisher's
share, among other costs, is reduced. For instance, that
biology book would go for $97.05 used.
But textbooks are regularly updated with new editions,
and some professors require the new editions of textbooks
for their classes. Fleming said students who purchase earlier
editions from classmates end up being out of sequence with
professors' lectures.
David Lang, store manager of the WVU Bookstore, said that
between 15,000 and 20,000 students will be buying books
this week at the store located adjacent to the Mountainlair
in the heart of the downtown campus. By Lang's estimate,
each student will spend about $300 each on textbooks for
classes.
Pending approval by Barnes & Noble College Stores Inc.,
which owns the business, Lang would not make any further
comments about the business practices or textbook pricing
at the WVU Bookstore.
Becky Lofstead, University News Services director, said
Barnes & Noble has had a contract with WVU to sell books
for 17 years.
"The cost of textbooks is rising nationally. This
is not just an issue at WVU," she said. "I'm sure
Barnes & Noble's prices are compatible with other bookstore
suppliers."
WVU receives in excess of $1.5 million a year as its portion
of sales from the contract. Lofstead said this money is
used for scholarships. Prior to this contract, Lofstead
said, the university operated the campus bookstore far less
efficiently and profitably.
"The more business they do, the better return there
is for the university," she said.
Aubrey Zeigler, 20, a WVU junior, said she spent a lot
of money for one textbook.
"I expect to spend probably $200 today. My biology
book cost $115," she said.
Fleming said the Book Exchange buys books back from students
at the end of the semester -- a common practice for university
bookstores -- based on several factors: whether the book
will be used next semester or replaced with a new edition,
and the condition of the book.
The money the student receives from re-selling the book
varies based on these factors.
Schmidt said professors should inform campus bookstores
about plans to reuse a textbook.
"It's good when faculty tell the bookstore what they
are going to need the next semester -- it gives students
a better bang for their book when they resell it,"
he said.
Liberowski said based on industry standards, a new book
sold by a bookstore for $100 can be re-purchased for $50.
The book will then be resold the following semester for
about $67 -- a price increase of about 35 percent.
Zeigler doesn't expect to recoup much of her money at the
end of the semester when she sells her biology book -- if
it is purchased at all by the bookstores. She will probably
end up keeping the book.
Zeigler, who is majoring in pharmacy, said the science
books in the lower-level classes become worthless as she
buys more advanced books for the upper-level classes. A
freshman biology book means little compared to a pharmacy
book.
"This is a complete rip-off," she said. "I
will never use these books again."
2%
economic growth seen in '07