Advocacy Articles

When Rob Strong, Director at SFSU Bookstore, San Francisco State University, was president of CACS, he wrote the following as his front page story for the CACS Newsletter. Though written in 1998, Rob's advice is more compelling than ever. We thank Rob for his permission to include this information.

"The Seven Deadly Warning Signs"

Hey, y'all. Allow me to first make an obligatory comment about the weather. It's nice today. OK. Down to business. Over the past few years, I have had the privilege of assisting in many college and university store reviews. Some have been under the umbrella of the NACS College Store Evaluation service. Others have been part of the CACS' Rapid Response Program. Others were independent consultant projects commissioned to build strategic plans for campus stores. Each of these reviews has afforded me a window into the inner dynamics of the subject organization. From these reviews, I have gathered several observations and conclusions. Please humor me and read on...

1. Stores arc Complacent. Management teams often take for granted their position in the marketplace. Despite shifts in competition, product format, and customer demographics, stores feel secure in their way of doing things-as they may have done for years. People often turn a blind eye to evident signs of change and feel they are too busy with daily operations to set time aside to plan for change themselves.


2. Financial Reporting is Inadequate. Most stores - particularly institutional stores - rely on financial reporting systems, which do not accurately reflect their own business. Most institutional stores are subordinate to a fund accounting system as opposed to a retail accounting system. Such fund accounting systems are not set up to provide accurate cost of goods sold (COGS), shrinkage, or balance sheet information. Further, they rely on a cash basis of accounting, so expenses may not be booked during the period in which they actually occurred.


3. Succession Planning Doesn't Happen. Some seem to care more about their own retirement than the future success of their business. OK. Granted. When I'm getting' ready to head to the slopes & valleys, it may be tempting not to give a rat's rear about the future of the business. But I assert it is part of the fundamental responsibility of a store manager to plan for her/his own departure. Who knows when you might walk out into the street in the path of a turnip truck?


4. Stores Don't Know How to Value Their Business. Most have little or no understanding of what their bookstore is worth in the open market. Most managers don't benchmark their own store's performance against industry statistics and are therefore ill prepared to either respond to external offers or explain to their boss's question "Hey, I just came back from a trip to Maintown and the Maintown College bookstore is paying their campus 10% of sales - why don't we get that from you?


5. Class Level Inventory Management. Many of us cannot track sales and cost of goods sold at class level. Class is a subdivision of "department"; class is a large category of similar merchandise such as "clothing", "candy", "art supplies", or "software". Without tracking financial information on this level, we are unable to manage our inventory effectively. Sales per square foot, gross margin return on investment (GMROI), and open to buy (OTB) cannot be set up or analyzed effectively without class level information.


6. The "I Know What's Best for My Store" Syndrome. Sure, it's tempting to believe that since you've been at your store in your position 5, 10, 15 or more years that you are the expert at what your campus wants and what you need to do to succeed. But one thing I have seen over the years is that the longer we stay in our positions on our campuses, the less we actually do see. Engaging an outside group to help bring new perspectives to your operations often provides the manager a golden opportunity to see the business with new eyes. Think about utilizing someone outside your organization to do just that.


7. Stores are Operationally Focused, not Customer Focused. Since many of us tend toward complacency in our market, we take our customers for granted. We turn our attention inward - toward policies, procedures, rules, regulations, internal politics, and employee issues. Of course, these are critical elements of our businesses. They cannot be ignored - nor should they. But what side is our bread buttered on? The customers' side. Unless the entire organization is focused on customer satisfaction, we cannot count on growing or retaining market share.

Excuse me for a moment while I step down from this soapbox... [grunt] ... there. I say, emphatically, look in the mirror. Warts and all. Your mirror is probably dusty, foggy, cracked, and warped from years of use. To see your true store's self, think about getting some additional perspective on what you are doing. Whether you use the NACS Store Evaluation Service, an outside consulting firm, the a Rapid Response Program (free to members!), a self-selected group of peers, or sign on as a term project of a campus marketing class, just do it. The Heisenberg Uncertainty Principle in physics states that the closer you are to the matter you are studying, the greater the uncertainty about the actual position of the matter. Same applies here. How can you step outside the box when you live in it? Think about it.