Advocacy Articles

Connect2One Pricing Survey Results: Paying the Price:

Theory: Prices at lease stores are higher than institutional stores.

Test Conducted: First conducted in 1999 and repeated during the August to October back-to-school period this year, the Connect2One price survey for school supplies and general merchandise compared prices on key items at lease stores and institutional stores.

School Supply Findings: While lease operators hold significant aggregated buying volume, the Connect2One price surveys support the argument that lease operators do not use their volume buying power to deliver lower prices. Independent stores deliver a better price value to their campus and students. In a market basket approach to 27 items typically shopped at back-to-school, students would have paid 15% more (on average) at a lease store over an institutionally operated store. In 1999, a similar market basket of 20 items cost students 12% more.

Spiral notebooks and binder categories represent the two highest volume categories for most supply departments in college bookstores (the national estimate is 45% of total school supply sales). The lease operators consistently showed elevated price points on spiral notebooks, averaging as much as 22% higher than independent stores. Likewise, the basic 1" plain binder averaged 27% higher at lease stores. The lease operators consistently show elevated price points in paper categories, the exception being the Marble Composition Book that was a heavily promoted price point item at the B&N chain as was the 150 count notebook paper at the Follett chain.

The item method of price comparison used in this survey cannot provide a complete analysis of an overall product mix used by lease operators to achieve higher price points. The lease stores surveyed did not offer a 100-count filler paper. On the most popular size spiral (the 80 count basic spiral), only one of the five Follett stores surveyed offered this lower priced option to their students. Median prices on imprinted spiral notebooks showed similar support to the fact that lower priced options are not generally available at the lease stores.

Apparel Findings: On the apparel side, 60 items were shopped reflecting that students pay 10% more for comparable items in lease stores than in independent stores. The 1999 survey reflected the same percentage.

In apparel, 9-ounce crew neck sweatshirts were only 1% higher in lease stores but 9-ounce hoods and 10-ounce crews were 11% and 15% higher respectively. Long sleeve t-shirts also showed a large discrepancy, averaging 14% higher in lease stores compared to independents. Lease stores also take higher margins on hats and backpacks, averaging 10% higher retail prices.

To receive a copy of the Price Survey results or to participate in future surveys, contact Paula Haerr at (800) 563-9034 or e-mail her at phaerr@nebook.com.