Two months ago, Follett, a company that owns more than a thousand student stores nationwide, submitted a proposal to lease the traditionally University-owned store, said Matthew Fajack, vice chancellor for finance and administration.
“I think (Student Stores is) doing a great job,” he said. “A big company like Follett and Barnes and Noble have a lot of tools that we can’t supply them.”
If Follett leases Student Stores, the company could pay a $3 million annual commission to the University, invest up to $2.5 million in renovations and attempt to decrease textbook costs by several million dollars, according to a proposal submitted by the company.
Longtime employees who depend on Student Stores for their retirement funds will also be in danger of unemployment. Fajack told employees about the offer at a Wednesday meeting.
“All of us employees have lost ground to inflation and are working for less now than we ever have been, and at the same time have worked under the threat of privatization for 15 years now,” said John Ware, who has worked at Student Stores for the past 15 years.
“A lot of us are 50 or 60 years old and don’t necessarily want to move to another community. I feel like it’s being taken lightly that we could be pushed out.”
Student Stores has historically given its residual funds to the University to pay for nonathletic scholarships and fellowships. Fajack said all of Follett’s commission payment, which he estimated would be closer to $4 million, would go to scholarships.
“A tradeoff between losing a couple people and $4 million in scholarships — you have to run an efficient university,” he said.
Charles Streeter, chairman of the Employee Forum, said he was told the Follett proposal was unsolicited.
“These things have happened in the past, and the forum has had a voice,” he said. “One of the things that should be made clear is that this is not a done deal.”
Fajack said if this proposal goes through, the Daily Grind Espresso Cafe, post office and soon-to-open pharmacy in Student Stores would not be affected because they are already privatized to a degree. Bull’s Head Bookshop, however, would be affected.
Bull’s Head manager Stacie Smith, who has been a permanent University employee for 20 years, said she worries she might lose her job if Student Stores is leased.
“I feel like we’re doing really good things in there,” she said. “I would hate to just be cut off from that, because I doubt I would have the same responsibilities (elsewhere).”
“We’re around you guys all the time,” she said. “I think we care more than if we were just punching a clock for a company we didn’t really want to work for to begin with.”
Senior Emily Monnett has been working at Student Stores since she was a sophomore and said she would not want to work there if her managers got replaced.
“Although I’m not worried about my job because I’m a senior and will have been there two years by the time any changes take place, I would almost definitely look for a new job if the management changed hands,” she said.
Fajack said that while Follett is not the only company that could lease Student Stores, a decision about whether to accept Follett’s proposal could come as soon as February.
“We will ask questions about how much they’re going to pay our employees and what kinds of benefits they’ll supply them,” Fajack said. “We do want our employees to be treated fairly.”
He said he doubts Follett will save money for the University as a whole, but it would provide more money for scholarships.
“I expect it to save the students money because they can buy (cheaper) textbooks,” he said. “(Follett’s) buy-back books will be better because when we buy books back, they have to be used on campus.”
Director of Student Stores John Gorsuch wanted to make it clear that store performance isn’t driving the proposal’s consideration.
“We are 100 years old. We are very solid financially,” he said. “We are receipt-run here. We don’t take a penny from the University. We are not a financial burden for the University whatsoever.”
Gorsuch said Student Stores already saves students money on textbooks without Follett’s help.
“We compare our prices to the marketplace and try to keep the costs of textbooks down, and in a lot of cases — I think I’m being conservative in saying this — in at least 50 percent of cases, we beat the online prices for textbooks,” he said.
“UNC-Chapel Hill should accept nothing less than what they have right now. Student Stores is a very valuable asset to the University of North Carolina, so if an outside company has a desire to come in here and run the business, then they need to prove they can do what we do and more.”
Student Stores accounting manager Toni Goshay-Horton said she and others were offended by the assertion that Follett might be able to run the stores better than they operate now.
“We’re educated people, whether we have college degrees or lifetime experience,” Goshay-Horton said.
“We’re all about Carolina here. We serve the students, and there’s some things you just can’t lease out.”