Coop Members to Receive 3.5 Percent Rebate
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The Coop returned to profitability last year. Members will receive a rebate of 3.5 percent of their purchases.
By Dudley Lamming
After several years of losses, the Harvard Cooperative Society returned to profitability last year, and members will be receiving a total rebate of almost a half-million dollars in the coming weeks.
An average member of the Coop will be receiving a check of between $13 and $15, equal to 3.5 percent of a member's purchases between July 1996 and June 1997, according to Coop General Manager AllenE. Powell.
Checks for MITstudent members will be available at the Coop's Kendall Square location later this month.
The return to profitability last year was due to a variety of factors, Powell said. A large part of the credit is a result of refocusing the Coop on textbooks and away from "things that customers were less interested in and we were less competitive in," including computer hardware, electronics, men's and women's clothing, and music.
The Coop has also benefited from the economies of scale from outsourcing day-to-day operations to Barnes and Noble Booksellers since late 1995. "The Coop was a rather small company compared to Barnes and Noble," Powell said. "They were able to spread out their operating expenses over a much larger area."
The last time the Coop offered a rebate to its members was in 1992, when members received a one percent rebate on their purchases. During the 1980s, the annual rebate was as high as 9.5 percent. But by the fiscal year 1990, the rebate had plunged to 5.5 percent because of poor sales volumes at its stores.
Restructuring of Coop continues
The Coop plans to continue its restructuring into this year, Powell said. It is currently undertaking major renovations at the Harvard Medical Center Store and at Harvard Square. The medical center renovations are designed to give the store more of a student and alumni focus. The Harvard Square renovations, which have been already going on for over two years, are designed to improve the infrastructure of the historic store.
Additionally, the Coop charge card will be discontinued in early November. As part of a new agreement with FirstUSA bank, the old Coop card will be phased out and replaced with a new FirstUSA Visa card.
"Once the Coop started accepting other charge cards, people started migrating away" from using a single-store charge card like theCoop charge, Powell said. Today, only around 50,000 customers receive monthly Coop charge statements, compared with far more a decade ago.
Current Coop card members will have the option to apply for a new FirstUSAcard instead of their current card. "The Coop membership operation doesn't really change; giving their Coop number in the future is important and remains the same," Powell said.
Coop members currently receive special discounts on MIT-themed merchandise and on Levi's jeans, but Powell said he does not see the possibility of further reduction in prices in the near future. "We feel that we're very competitive in terms of pricing. We have no plans to reduce our prices below that of the competition," he said.
The Coop hopes to continue its profitability next year, Powell said. "We hope that this year is the beginning of a positive trend that will let us continue the rebate but you don't know that until you finish your fiscal year and determine your profits."
Douglas E. Heimburger contributed to the reporting of this story.