Dr. Solomon Namala and political science professor Terrence Mullins raised their concerns over the lack of a drop in book prices during the Dec. 2 Faculty Senate meeting.
Despite their negotiations with the book publisher, the price in books did not drop, according to Mullins.
During the meeting, Mullins argued that the margin in the cost for books and the margin stipulated in the Follett Bookstore contract didn’t coincide.
“We have negotiated this book (an economics book) for $130 from the publisher and (it sells) it for $191.50. That margin is 61 percent and you divide that from the price and the profit margin of 47.3 percent,” Namala said.
He also brought into question an amendment to the original Aug. 27, 2010 contract.
The amendment included restocking fees and return policies on new textbooks and freight and handling costs for books sold to Follett at less than 25 percent discount.
Namala believes that this ammendment allows Follett to make more money at the expense of students.
“What’s happened has happened, but my concern is that it should not allow the amendment for the contract renewal in 2015.”
Vice President of Business Services David El Fattal responded by saying that there might be confusion in the terms.
He explained that that margin is a set percentage on a product that goes into operational costs to keep a business viable. For example, if someone is buying a product for $10, with a 40 percent margin that means the product is more than $10 but that extra money is going into keeping the business alive.
Mark up or mark down does not mean the same as margin, according to El Fattal.
Regarding the differences in margin between Namala and the contract,“I don’t know if that’s an accurate statement. What I answered to that question is that if (a lower price is negotiated), take Pearson Publishing as a per instance. That lower price becomes the new standard for Follett to pay,” El Fattal said.
He explained that Follett would then add a margin because the company couldn’t sell the book at cost or it wouldn’t be able to pay employees and expenses to operate.
Namala had notes outlining the differences in gross margin, which differed from 47 percent to 49 percent, instead of the contracted 25 percent in the Follett contract.
El Fattal said, “There may be different factors (why the numbers differ) for example, if a book has a list price printed on the book that has to be the sale price.”
He explained that this exception was in the contract, but that he was willing to look into Namala’s notes.
Regarding the July 1, 2010 amendment to the contract, “I mentioned to a student group and Dr. Namala, my signature is on that contract but I think I’d only worked here for 10 days. The Board had already approved the contract.”
Mullins was concerned that Follett hasn’t been auditied in three years. El Fattal mentioned that Follett has not been audited in three years.
“I asked him [El Fattal], after laying down the problem, what was the district doing on to make sure the prices are going down on Follett’s end […] and there was no response. The question was answered vaguely with the idea that ‘well, the student government recieves money.’ That doesn’t answer my question.
“We’re mindful of how much books cost, we see it in our students,” Mullins said.
