King’s bookstore posts record deficit
Board implements cost-saving measures, looking for solutions
November 26, 2012, 11:02 PM AST
Last updated November 27, 2012, 3:11 PM AST
This story has been updated since initially published.
The King’s Co-op Bookstore is doing some soul searching after receiving its annual financial statement.
While the bookstore brought in $98,547 in profit, general and administrative expenses totaled $115,116, contributing to a deficit of more than $16,000, the largest deficit ever posted.
In order to eliminate the red, the bookstore has taken steps to reduce spending by slashing staff hours by 25 per cent.
Harry Sawchuk, a fourth-year King’s student and a sales associate at the bookstore, had his 12-hour shift shortened to 10 hours.
“Everyone has taken a cut,” he says. “Even people who used to work four hours a week now only work two. Everyone has taken a two-hour cut.”
Sawchuk says the board thought cutting hours was the best way to eliminate spending.
“Their first response and only response was to cut staff hours. Because it is the biggest cost.”
The bookstore’s staff wages have increased from $40,000 in 2006, its first year, to more than $80,000 this year. Stephanie Duchon, chair of the bookstore’s board of directors, attributes the sharp increase to a rising minimum wage and the additional salary of the bookstore manager, which didn’t exist back in 2006.
The bookstore board of directors is made up of four student representatives and three members at large, currently one alumni and two faculty.
Carolyn Gillis, the bookstore manager, says although she has hired new staff, she had kept the original 80 hours of student labour a week unchanged until this cut. The cost of those original 80 hours a week has increased since the bookstore opened in 2006 because of provincial government increases to minimum wage.
“The fact that minimum wage has gone up by over two dollars an hour makes a difference,” says Gillis.
Sawchuk says the board also requested reports from the bookstore to find out how 50 and 75 per cent reductions of hours would affect the bookstore.
The most extreme case — a 75 per cent cut — would only see one person at a time working in the bookstore, a scenario which would have several logistical issues. Currently it takes three people 10-15 minutes to pack and unpack the bookstore displays each day. One person alone could take upwards to 40 minutes.
Such a plan would also see the manager of the bookstore taking on the role of sales associate, which Sawchuk doesn’t think is fair for Carolyn Gillis, the bookstore manager.
“The most extreme of the board’s plan would have one person working four hours a day and the rest would be Carolyn,” Sawchuk says. “No more than one customer could be helped at a time. If the phone rings and you’re helping someone else, someone is going to be ignored.”
Gillis rejected the idea of using volunteers in the bookstore to save cash.
“When the store was originally started one of the requirements of the bookstore was, because it was funded through the King’s Student Union, to provide jobs on campus, so it’s never been part of our thing to have volunteers.”
Duchon reiterated Gillis’ sentiment: “The idea of the bookstore is to provide some employment for students.”
Increasing the existing prices on the books to drive up sales is not an option.
“Most books are priced by the publishers,” says Gillis. “We really can’t increase prices because people just look at prices online and they’re like ‘You’re ripping us off.’”
The bookstore’s advertising spending has fluctuated over the past six years. For example, in 2010, $5,150 was dedicated to advertising, whereas in 2009, only $328 was allotted.
Bank charges and interest also grew significantly. In 2007, bank charges accounted for around $3,300. In 2012, that number was more than $8,200. Duchon says those charges are exacted every time a purchase is completed with a debit or credit card, and are “why Dal and King’s stopped accepting credit card payments for tuition.”
“It’s just one of the factors of doing business,” says Gillis.
An annual general meeting was scheduled for Nov. 21 to discuss the future of the bookstore and an appropriate plan of action to recalibrate the finances. However, due to a communication error the meeting was bumped to January.
“The secretary did send out an email to all members of the co-op 10 days before the meeting saying what the motions were, giving a date and that there was going to be a meeting,” says Sawchuk.
“But at the time he hadn’t booked a room at King’s so there was no time or place and because the email did not include that information we got an email on Friday of last week from this governing body saying that the meeting could not go ahead because the membership had been insufficiently informed.”
If the meeting had continued, any action taken would have been deemed invalid and would have been revoked.
If the meeting had gone through, the bookstore board of directors was to hear about two proposals to initiate change. Firstly, co-op members wanted to have a staff member on the board. Secondly, co-op members wanted to start a promotions committee to promote the bookstore and target potential customers.
Sawchuk says, “There is a demographic here of affluent older people who have money and time to spend reading books that students don’t have” — the type of people the bookstore wants to reach.
The bottom line, however, is attracting more customers.
“Every idea is worth considering, it’s just whether if we can make it work,” says Gillis. “Our best solution to the problem is more customers.”
Update: An earlier version of this story said the bookstore board of directors is made of up four student representatives, one faculty member and two alumni. The board of directors is made up of four student representatives and three members at large. The story has been changed to reflect this.