Oct. 5--The store is one of the oldest in the city.

It was around before the state Capitol burned in 1904 and during its time has been a prerequisite stop for most students attending UW-Madison.

University Book Store, 114 years after it was founded as a cooperative, is no longer a must stop for students.

Textbooks can be purchased at used book stores and new books on Internet sites like eBay and Amazon.com. Digital books can be downloaded direct from the publisher. Larger book stores, like Borders and Barnes & Noble, have also cut into the general book market. Badgers sweat shirts and T-shirts can be found at the two campus-area Walgreen Drug Stores and numerous other shops on and near campus.

"Competition is probably good," said Pat McGowan, president of UBS. "Students, when they are paying high textbook prices, it's nice for them to see that they're similarly priced at multiple bookstores. There was a time when the bookstore was the only alternative."

That's no longer the case and UBS, a privately operated company that doesn't receive funding from UW-Madison, has evolved.

It has stores in six locations, including a computer store at the corner of Lake and State streets. On Wednesday, the company opened its first store in the Milwaukee area at Brookfield Square mall, a move that will require the store to sell UW-Milwaukee and -- hold on now -- Marquette Golden Eagle apparel.

Q: How did this business start?

A: It was originally a book-buying co-op and then in 1914 it turned into a trust. It has as its beneficiaries the students of UW-Madison. It's a for-profit, tax-paying trust and it's a hard thing to describe to people who you're trying to business with, sometimes. We have a board of trustees not a board of directors. There are other bookstores like us. It was popular to set bookstores up as co-ops back in the late 1800s. Harvard did it. Yale did it. Texas still is a co-op. And there are others that have some sort of an ownership that is not owned by the university but is there to serve the university.

Q: What do students gain as beneficiaries?

A: In our case, the idea is that we are to sell books at the lowest price consistent with sound business policies. We take that as a price that allows us to have a reasonable return on equity and still pass on savings to students. A normal textbook mark-up at your average college bookstore is about 25 percent. We work in the 18.5 to 19 percent range. So, we're 6 to 6.5 (percentage points) lower than the average college bookstores. There have been some years where the bookstore has lost money and some years where the bookstore makes money.

Q: What defines a good year at your business?

A: It's a different way of managing and a different way of gauging success. You don't necessarily gauge success on what the bottom line is at the end of the year. We have a report that we show to our board of trustees that shows profitability. We also have a report that shows savings to students and both numbers are important.

Q: What has the competition meant to your store?

A: There are a lot of alternatives and even bigger than that, there's a movement away from textbooks for teaching. There's not required text for every course like there once was. The number of adopted textbooks and the required textbooks that we see every year goes down 5 to 10 percent every year.

Q: Do you see a day where your textbook sales are almost nonexistent?

A: I see it getting smaller. I think it will be a long time before it's nonexistent. It certainly has gotten smaller and we do it with less staff now than we used to. Also, how we get books has changed quite a bit. We buy a lot of books on Amazon for resale to the customer because the bottom line is that we can buy them cheaper from Amazon or from eBay than we can a publisher or wholesaler. And that, because of how we're organized allows us to lower the price to the student.

Q: What about the cost of textbooks?

A: We've got a smaller staff and we're selling fewer books than we used to and we're doing it for less margin than we used to. Textbook sales today are about the same, dollar-wise, as they were 10 years ago.

Q: Ten years ago, what percentage of your sales was textbooks and what is it today?

A: It was probably about 60 percent 10 years ago to about 45 percent now. The other big change is that 10 years ago we had a substantial general book market. We sold a lot more general books. We had a kids' store at Hilldale (Shopping Center), we had a bigger general book presence here and those sales have really been replaced by apparel sales.

Q: Your children's store at Hilldale, a store on Junction Road and an outlet store in Johnson Creek have closed over the past five years. What happened?

A: Those stores weren't profitable. They were profitable from time to time. If they weren't profitable and weren't allowing us to sell textbooks at a lower price, we close them. Now everything we have is profitable.

Q: Why a store in Brookfield Square?

A: It's really a test. It's a four-month lease. It came about because the mall managers for Brookfield also run the Janesville Mall. Our Janesville store we've had for a few years, we've expanded it and it's doing well. It really owns the market down there. CBL ( & Associates Properties), the company that manages both malls, they saw our store in Janesville and wanted to bring it to the Milwaukee area. We used to have a kiosk in Mayfair Mall (in the Milwaukee suburb of Wauwatosa) but for the amount of work involved, it wasn't real profitable. This (at Brookfield Square) is a four-month lease because Wilson Leather moved out and they have an opening for the holiday season. So we thought we'd go in there and try it for four months. The store is ready to go. We didn't have to do much of a build-up to get it up and running, so we'll see how it goes. If it goes well, we'll stay.

PAT McGOWAN

President of University Book Store

Year business was founded: 1894

Locations: 711 State St.; Hilldale Shopping Center, 702 N. Midvale Blvd.; Health Sciences Learning Center, 750 Highland Ave.; Brookfield and Janesville. The Digital Outpost, the company's computer store, is at 673 State St.

Web site: www.uwbookstore.com

Number of employees: 80 full time, 100 part time

Annual sales: $25 million

Age: 43

Hometown: Waunakee

Family: Wife, Carol, and three children, ages 13, 11 and 8

Education: UW-Madison

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