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<td width="590" valign="top"><font SIZE="4">FYI<p>Georgetown University Launches Bookstore
Management Company</p>
<p></font><font size="3">Colleges and universities, thirsty for money in the fiscally arid
environment of the early 1990’s, are eyeing the traditionally humble campus bookstore
as a potential source for revenues.</p>
<p>Long subsidized by their institutions as necessary money-losers, campus bookstores are
now seen as potentially efficient and profitable ventures. As more institutions view their
bookstores in that role, they have begun to seek advice about improvements to the
operation of the campus bookstore, and available options to pursue those improvements.<img src="../images/quote3.gif" align="right" border="0" hspace="5" WIDTH="120" HEIGHT="120"></p>
<p>Georgetown University has formed a bookstore management company to help institutions
improve their bookstore operations.</p>
<p>"The university formed Bookstore Management Concepts (BMC), a subsidiary of the
university, in the summer of 1991," said Ron Duvall, president of the subsidiary and
director of campus bookstores. The entity was formed to address concerns about
institutional store operation, including the option of leasing.</p>
<p>"Three major elements make up the charge of the subsidiary," Duvall said.</p>
<p><strong>Consulting</strong>: BMC consults with institutional bookstore managers and
reviews various aspects of the existing operation, either as a broad-based overview or by
targeting specific processes, Duvall said. "There is really no other source out there
for objective answers to the questions that institutions have about how to improve their
bookstore operations," he said.<br>
<strong>Transition</strong>: "BMC can provide the institution with alternatives in
the case of an outgoing manager, either by providing trained employees, or by hiring from
outside the university," Duvall said. "We can supply one manager, or a
management team, and can get things running so that the institution can take over at some
point and operate the store on its own, " he said.<br>
<strong>Leasing</strong>: "Some institutions want to go the full leasing route,"
Duvall said. "It all depends on what is in the best interests of the institution, and
we help them identify those interests."</p>
<p>"This array of options is new to the campus bookstore industry," Duvall said.
"It used to be either sink or swim by self-operation or leasing," he said.
"We felt the need for more than just those two options, but there was no network to
work with the institution to show how they can do it themselves.</p>
<p>"There is a need for a new understanding in campus bookstore management that with
the proper training, a bookstore can be run institutionally just as well as a leasing
operation can run it," he said. "One of the biggest problems with bookstore
operations is simply basic training for managers. They often have a lack of training in
the operation of the business. BMC offers a training center for bookstore personnel
to help fill the training gap," Duvall said.</p>
<p>"The unique challenges of bookstore operations in higher education also must be
considered when exploring ways to improve store operations," Duvall said. "There
has to be a deeper understanding of the agendas of the university or college
environment," he said.</p>
<p><strong>Revenue Generator</strong>: "The traditional perception that the campus
bookstore needn’t be operated at peak efficiency is a lingering concern, but one that
is gradually being erased by the need for revenue," Duvall said. "With the
fiscal situation on campuses today, officials are looking for as many revenue generators
as they can find, " he said. "The historical thought was that you could either
provide good service, or you can enjoy net revenues, but you can’t have both. The
truth today is that if you provide the best possible service, that will provide revenue.</p>
<p>"Georgetown stepped into this management void after considering the lack of
options facing campus bookstore," Duvall said.</p>
<p>"Georgetown got into this because we felt we had a particular expertise in campus
bookstore operations," Duvall continued. "We have run good operations here, and
in discussing it, we thought we could market that expertise and serve as a
revenue-generator for the university."</p>
<p>"A lengthy planning period of about three years preceded the launching of
Bookstore Management Concepts," Duvall said. "The planning period was crucial.</p>
<p>"Any institution interested in doing this has to have the true desire, the true
dedication to make it work, just like any business," he said. "From the
planning, the formation of the business plan, to insuring that all the issues are
addressed, that takes a lot of work.</p>
<p>"An especially sensitive issue was the specter of unrelated business income
tax," Duvall said. "We spent countless hours – well, I can’t say
countless, since the attorneys kept precise records – but we spent a lot of time with
the attorneys and a lot of time with our accounting firm, making sure that everything is
fine in regard to unrelated business income. We made sure the structure is set up so we
won’t have any trouble with that."</p>
<p>As business officers become more involved with bookstores as revenue generators, the
need for experienced advice grows, Duvall said. "Most business officers do not come
from a retail background," he noted. "Many of them don’t understand from
the inside what it takes to run a successful entity that they can go to for objective
answers to questions about the bookstore operations. The established leasing companies
– the Follets and the Barnes and Nobles – have proven the need is there. We can
help fill that need with a unique perspective on the campus bookstores operation."</p>
<p>--NACUBO Business Officer</p>
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<p align="center"><small><small>�1999 Duvall Group, Inc.</small></small></td>
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