June 30, 2008
To Avoid High Price of Textbooks, Students Turn to Renting
With a college textbook often costing more than $100, it’s no wonder that students are protesting, and Congress has discussed legislation to lower the price of textbooks.
But what if students rented books instead of buying them? That’s the business model behind a company called Chegg, which was started a year ago and bills itself as “the Netflix for college textbooks.” Students identify the books they want to rent and place their order online. Then, Chegg ships the books to students’ residences. After using the books for a semester, students mail the books back to Chegg with prepaid shipping labels that they download from the Chegg Web site.
Chegg literature says its rental model can save students 60 percent to 80 percent off the price of a book. —Andrea L. Foster
Posted on Monday June 30, 2008 | Permalink |Comments
Commenting is closed for this article.
Previous: U. of California Researchers Hold Wikipedia Authors Accountable
Next: Developing a Good College-Company Relationship
Renting textbooks seems like a great idea to me. At the beginning of every semester I always dread having to drop multiple hundreds of dollars on books. More affordable options, such as renting, would be a great resource for students.
On a side note, sometimes textbooks are worth the full price if they are related to my major or a specific topic of interest.
Lastly, I wonder what college bookstores feel about this. It seems logical that a textbook rental service such as Chegg would discourage students from buying through the school.
— Dbush Jul 1, 09:15 AM #
Does anyone know what the average mark-up on a textbook is or where I might find that information? Also, given that many textbooks have a new edition frequently, would it make more sense for faculty, or more likely their TAs, to find articles via e-databases for students to read rather than a textbook? It seems that they would contain the latest research/theory/ideas and would certainly be cheaper. Forgive me is thie seems naive, I am not familiar with the politic of texts.
— Brian Jul 1, 09:19 AM #
How does this affect the cost of textbooks? It lowers the up-front cost, but if you buy a textbook you can resell it. There are some potential benefits from renting, but a lower cost is not one of them. I assumed it would be renting for a day at a time, sort of an organized sharing. The only way renting can lower the cost of textbooks is by allowing more users in a given time period.
— me Jul 1, 09:28 AM #
I am the manager at a college store in Wisconsin. We rent textbooks to students on our campus, and have been doing so since 1894. A number of WI campus have a rental program, but each one is slightly different. I believe the average student pays between $400 – 600 per year on books at a purchase books school. Text Rental is a wonderful service that saves students money while allowing them to still get the knowledge needed from books. Our students pay a rental fee with tuition that saves them hundreds of dollars each semester. I don’t think an online service for text rental is necessarily the best idea. I think that universities should seriously consider starting rental programs on their campuses. The start up cost is quite high however. The National Association of College Stores has some very good information on this topic.
— Stephanie Jul 1, 10:36 AM #
I hope online rental options flourish. While some campus bookstore employees, such as #4, are in it for the right reasons, too many such stores have ripped off students for a long time and become completely unresponsive to student feedback, as monopolies are prone to do. I hope the full force of competition hits them hard.
— Voice Jul 1, 11:12 AM #
I’m a library director and have known two college bookstore managers. They both tell me that markups are only in the 5-10% arena. It seems as if it’s the publishers who are raking in the dough.
— Michelle Jul 1, 11:40 AM #
The industry margin on textbook falls between 20 and 25%. Retail price is based on the publishers cost. The statement that College Book Store’s have been ripping students off for a long time is incorrect. College Bookstore’s have been developing better business models and strategies to help combat the high price of textbooks caused by higher publisher prices. Rental programs can offer a strong upfront savings to students. However, to offer a true savings to students, store’s should concentrate on stronger textbook buyback programs. Buying a Used book at 25% savings and then selling them back for 1/2 of purchase price results in a net cost to students much less than most rental fees. The largest issues associated with rental programs is the high start-up costs to purchase the inventory. depending upon the fees charged, the costs would not be recouped for 2 to 4 years. How are college bookstore’s able cover their operating expenses without that revenue? Institutions that are financially supporting their auxiliary operations end up increasing tuition for students to offset that support. Unfortunately, while used textbooks offer significant savings to students, they are also partially at fault for higher prices. Publishers place a higher cost on a textbook when it first comes out so they can cover their costs and revenue predictions during the first year the book is out. Publisher gain no revenue from used copies. However, some control needs to be placed on the frequencies of new editions coming out. I can understand publishers dilemma when a new book is published. But to reprint the same material after 18 to 24 months with nothing changed but the cover and a few pages, is not only a big cause for higher prices, but clearly shows the monopoly that students and college bookstore are up against.
— Matthew Branca Jul 1, 11:51 AM #
I have not been in the “textbook” business, either as an employee of textbook publishers or as a scholarly book publisher myself, for a number of years, but I can testify to my occasional envy of the college bookstore where, as retailers, they did not have to make decisions as to what to purchase — that decision being made for them by the professors — nor what quantites to purchase — they could return any unsold copies — and were able to defer payment to the publisher for up to six months. And, the markup on textbooks was 20% and sometimes as much as 25%. I rather doubt things have changed for bookstores that much.
— James Davies Jul 1, 11:53 AM #
After almost 4 decades in the classroom (Geology) I felt almost guilty about assigning an intro level text that, after only two or three years, has been revised. And even if it comes with all sorts of gee whiz computer stuff.
For a while I tried to beat this by producing multiple course outlines making use of the 3rd, 2nd and even the 1st edition even though the 4th (or 5th by now) was already pumped out.
I wonder why I didn’t find the time or have the inclination to write a new text myself and climb aboard this gravy train by repeating what has been known about rocks and fossils for centuries and tacking on a new chapter about some white stuff being found in the sediments on Mars.
Hard to resist an attractive young person sent around by Prentice-Hall that offers to buy lunch.
— AW Jul 1, 01:01 PM #
Chegg is renting a book for 20-40% of it’s new cost. Used books are generally a better deal for students as another poster points out— the problem for both Chegg and students will be owning the 3rd edition book which can’t be used (most of the time) when after 2-3 years a new 4th edition textbook is published with only minor changes. Students should ewncourage their faculty to approve a 4 year adoption of a textbook guaranteeing that they will not use a new edition for at least 4 years. If bookstore and student knew this was the last year that a textbook edition would be used, great efforts could be made to have all used books for sale (which would be at comparable prices to Chegg’s rental plan). Good luck on anything that gives students a break on the high cost of text books which are caused by publishers and not the campus bookstores.
— Leila Menzies Jul 1, 02:32 PM #
A four year adoption cycle would certainly be desirable from a faculty members point of view, in terms of revising course materials. However, one can hardly adopt one book for 4 years, if the publishers come out with a new edition in 2 years, and used copies of the older edition cannot be found in sufficient numbers.
— Sue Jul 1, 05:56 PM #
1. Bookstore markup is around 30% these days.
2. If you want to determine the “net price” of the text you’re about to adopt (if you’re a professor) or purchase (if you’re a student), simply go to bn.com and divide the “online price” by 1.3.
3. When a student buys a new copy of a text and then sells it either to the bookstore or directly to another student, the difference between the price s/he paid for the new copy and the price s/he gets for it at the end of the semester is, technically, a rental fee.
4. Even as prices of textbooks have risen, the profit margins of college textbook publishers have flatlined. That’s partly because the faculty using textbooks have insisted on ever more support material in recent years: materials such as test banks, transparencies, Blackboard cartridges, Powerpoint lectures, DVDs, instructor’s manuals, student self-testing technologies with assessment and tutoring capabilities (as well as sophisticated “gradebook” functionality), “grants” from publishers to fund speakers’ fees and on-campus symposia, customized course materials that often cost the publisher more to produce than the standard textbook, solutions manuals, and on and on. The reasons why faculty have offloaded more and more of the pedagogical work onto publishers are clear——they’re overworked and underpaid. And this happened because of decisions made by administrators striving for ever more ‘efficiencies’. In the process, they (university administrators) have partially outsourced classroom instruction to textbook publishers. Publishers, naturally enough, have passed on to the customer the drastically increased costs involved in creating these teaching materials.
— Pete Jul 3, 09:54 PM #
We are so happy you stumbled upon Chegg. We are ready for the 2008-2009 school year and are serving 2,100 plus schools this year.
Order soon as August 19th is the biggest textbook ordering day. As always, we would love to know your feedback once you have tried the service.
Chegg Support Team Member
— Chegg Support Team Member Jul 21, 03:38 PM #