The University Co-op has faced hard financial times over the past five years, posting millions of dollars in operating losses and closing multiple satellite stores across the state, according to the Austin American-Statesman.
However, the Co-op has made an effort to turn this around by focusing the past two years on improving its main store on Guadalupe Street, and CEO Cheryl Phifer said it may make a fiscal profit for the first time since 2013.
“We are in fiscal 2018 now … and we’re probably going to break even,” Phifer said. “We might be just slightly positive, or just slightly losing money, but that’s a huge turnaround from where we were.”
The Co-op closed three satellite stores in Fort Worth, Houston and on Dean Keeton Street in Austin during 2016 and 2017. Its two remaining satellite stores, located in San Antonio and Plano, will close when their leases are up in December and 2021, respectively. Phifer said the Art and Supply Co-op, also located on the Drag, will be closed and consolidated with the main Co-op store when its lease is up in a few years, but there won’t be any changes to the inventory or staff.
Michael Hasler, senior lecturer and chairman of the Co-op board, said the rise of online shopping has decreased the need for the satellite stores to stay open.
“The profitability of those satellite stores has dropped pretty significantly with the advent of e-commerce,” Hasler said.
Hasler said closing these stores is part of the Co-op’s plan to refocus its attention on the main store on the Drag. The store has undergone many changes in the past few years, which Hasler said has contributed to the Co-op’s increased profitability. Those changes include adding non-UT and Austin-related merchandise, emphasizing the online store and changing the layout of clothes in the store to be less packed in.
“The products are displayed in a different way where it’s a lot nicer, neater (and) a lot more open and airy,” Hasler said. “Now, I think the shopping experience at the Co-op is more like going to Target than going to Walmart.”
Phifer said in the coming months the Co-op will focus on meeting the needs of faculty by accommodating the increasing role of e-textbooks and interactive materials. Phifer said there will also be a change this fall to the Co-op’s rebate program, which will be replaced with an upfront discount for students, staff and faculty.
“It probably will not start out as high as 10 percent, which is where the rebate was, but we want to get to a good amount, and then the goal is to continue to add to that as our financial situation improves,” Phifer said.
Marissa Dunagan, studio art freshman, visits the Art and Supply Co-op for supplies for her classes and said she would be fine with the consolidation as long as there is no change to the products offered.
“If they are careful to keep in high regard the amount that students really do need the art Co-op, and the variety and the amount of supplies that it has … I would be fine with the change,” Dunagan said.
Neuroscience senior Mauricio Toledo said he remembers a satellite store in his hometown of Houston being open just a few years ago and was surprised to hear that the Co-op is struggling financially.
“You pass by (the Co-op) on the Drag, and it’s this iconic thing,” Toledo said. “It’s crazy (that they have been struggling).”