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Business Officer Magazine

Forging a Strong Chain

Founded a decade ago, the Collegiate Retail Alliance brings benefits of buying power, best practices, and technology to dozens of independent college stores.

By Sandra R. Sabo

Back in 1999 the directors of five large college bookstores found themselves at the same conference, talking about what the future might hold. They quickly concluded that if independent stores like theirs were to succeed in the new millennium, the increased productivity and efficiency required to stay competitive meant working together at a new level. They decided to form a chain of college bookstores, bound by common business priorities and leveraged resources. And so was born the Collegiate Retail Alliance (CRA).

“Independent college stores, even larger ones doing more than $20 million a year in business, are still considered small,” says Richard W. McDaniel, CRA's president and chairman. “We organized the alliance to have the benefit of scale, as well as to develop and deploy best practices.” At the time, McDaniel worked for Cornell University, from which he recently retired as vice president of risk management and public safety. Joining him as cofounders of CRA were Pam Mills at University of Colorado at Boulder; Bill Simpson at the University of Connecticut, Storrs; John Turk at the University of California San Diego; and Roger Reynolds at Brigham Young University, Provo, Utah.

The cofounders, essentially working as one chain with five locations, immediately set about to negotiate with major supply channel partners. One year later they jointly purchased RATEX software—the inventory management system most prevalent among larger college stores, including, coincidentally, the bookstores of all five cofounders. The group later rebranded the RATEX acronym to mean “Retail Alliance Technology EXchange” because, as McDaniel explains, “Our members jointly develop these technology solutions and exchange them to the benefit of all.”

From Ideas to Implementation

The Collegiate Retail Alliance didn't stay small. In time the five founding members were joined by an additional 20 “core members” that also use RATEX software and share in other critical CRA business relationships, plus several dozen bookstores that use different inventory management software but want to capitalize on the group's buying power.

“Over 10 years we built a common system and partnerships, and the alliance has blossomed,” observes McDaniel. “Our overall membership does just under $1 billion a year in business, and we're constantly thinking about what our stores need to provide better services to their campuses.” In 2009, CRA received the Leveraging Excellence Award from the National Consortium for Continuous Improvement in Higher Education (NCCI) in recognition of its efforts.

CRA's members develop shared business plans in meetings conducted twice a year, in March and July. There, they discuss industry trends, brainstorm ways to provide their student-customers with additional value, monitor progress on initiatives under way, and launch new ones. One project, for example, focuses on a webstore solution that enables universities to mass-customize and distribute course materials to students, who can also use the system to order all their materials as well as contact faculty. Another project relates to custom publishing and print on demand, so bookstores can quickly respond to students' needs and requests without maintaining a large inventory. Yet another, still in development, will offer students the option of renting textbooks for the duration of a school term.

“Textbook rental is turning out to be highly valued by students, and delivering on that requires an alignment of systems and partnerships,” says McDaniel. “It would be very hard for an individual store to work out all the nuances of such a project itself but, in aggregate, a group like the CRA can make it happen.”

The alliance has rolled out the pilot phase of its textbook rental program, just six months after members first discussed the idea. McDaniel credits a structured project management approach for keeping CRA on track with its comprehensive and often complicated initiatives. Each initiative is headed by a point person from one of the alliance's core members—typically someone who is passionate about the project—and supported by a professional project manager based in CRA's central office. Each project team draws 10 to 15 volunteer members from around the country; they convene via conference call every two weeks and meet face-to-face as needed. In addition, CRA assigns each team a charge, a set of deliverables, an allocation of resources, and a timetable of milestones.

“Universities often help one another by just sharing good ideas. But when most of us return home after a meeting, the norm becomes 'out of sight, out of mind,'” notes McDaniel. “By using the project management process and linking technology to it, however, things actually happen when our members go home. Each team, for example, has to work out the system components, document everything, and create a way to train the rest of the user base.

“Yes, it's a ton of work,” continues McDaniel, who estimates that he has invested several thousand volunteer hours in CRA projects over the last decade. “But,” he adds, “the deployment rate of good ideas is quite high and these are some of the best people in the business world to work with.”

SANDRA R. SABO, Mendota Heights, Minnesota, covers higher education business issues for Business Officer.

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