What the Heck Happened to My Dollar - College Textbooks

The best part about school letting out is that we don't have to pay for textbooks, and the worst part about school beginning up is paying for textbooks. Why are textbooks so expensive? On my campus, we have two book stores: The university book store, and an independent, "off-campus" bookstore. I had a conversation with the boss of the independent book store, which happens to be right next to the enterprise school.

He told me that even though we pay an arm and a leg for textbooks, if his establishment wasn't present on our campus we would pay even more. It's simple economics: if the lawful bookstore of the university was the only bookstore on campus, they can set their own price. The nearnessy of competition (Campus Book & Supply) troops prices to drop for everybody. Thanks, Cbs!

College Textbooks

Their behalf margins are within a few percentage points of each other.

Speaking of margins though (margin being Selling price minus costs), the bookstore I go to have behalf margins per book of 50-60%!! Most any bookstore does. What this means is that if they buy a book for , they'll sell it for 0-125.

Due to the nature of the industry, bookstores wouldn't survive if they didn't price similarly.

Paying so much for books stinks, I know. That's why you have to budget [http://www.collegefinance101.com/download-worksheet.php] and plan for these expenses.

But why do textbooks cost so much? Well,

.32 of every dollar goes to the publisher's paper, printing and editorial costs. This number includes all manufacturing costs from editing to paper costs to distribution, as well as storage, record-keeping, billing, publisher's office, and employee's salaries and benefits.

$.07 (after-tax) is publisher's income. This is after-tax revenue from which the publisher pays for new goods development, author advances, shop research and dividends to stockholders.

$.11 goes to college store personnel. Store employees need paid too! This number pays for employee's salaries and benefits to handle ordering, receiving, pricing, shelving, cashiers, buyer service, the refund desk and sending extra textbooks back to the publisher. This is all part of their budget.

$.12 goes to author income. The author's royalty cost covers the author's expenses for research and any writing expenses incurred. Believe it or not, you're teachers don't make much money off of the books they write.

$.10 goes to the publishers normal and administrative expenses, along with federal, state and local taxes, excluding sales tax paid by publishers.

About $.15 goes the publisher's marketing costs. Such costs contain marketing, advertising, promotion, publisher's field staff and the free copies for professors.

Like these clubs need to "market" their textbooks. Our syllabi do a plenty good job of marketing what books to buy...

A exiguous more than $.04 (pre-tax) is each college store's income. The number of federal, state and/or local tax, and therefore the number and use of any after-tax profit, is determined by the store's ownership, and commonly depends on either the college store is owned by an institution of higher education, a ageement management company, a cooperative, a foundation, or by private individuals.

$.07 (approximately) per dollar goes to college store operations. This includes insurance, utilities, building and tool rent and maintenance, accounting and data processing charges and other overhead paid by college stores.

Almost $.02 goes to freight expense. The cost of getting books from the publisher's storehouse or bindery to the college store is the main part of this cost. Part of cost of goods sold is paid to the freight company, obviously.

With gas on the rise... Well... You get the drift.

What the Heck Happened to My Dollar - College Textbooks

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