Despite the market being up, student numbers are down with little relief in sight. Finding additional income that can provide stability without raising tuition is necessary.
Students and families don’t have more money to give. College costs have increased by 63% since 2006, far exceeding the rate of inflation. Student loan debt has skyrocketed and many graduates aren’t able to pay for their loans even after they enter a career. The pressure on colleges to lower costs will continue to increase as the student loan debt crisis and the price of education grows.
Already private colleges and universities are discounting tuition through grants or scholarships at an increasing rate hoping to attract more students, but that doesn’t solve financial deficits. As states decrease funding and fewer students apply to attend, the situation is rapidly approaching dire for many institutions. The University of Missouri has announced layoffs and freshmen enrollment has dropped 35%. This won’t be a unique occurrence as enrollment continues to change. That’s why many colleges, like Purdue and Harvard, are looking at ways to bring new revenue streams to the institutions.
New college revenue streams:
- Corporate training
Harvard University has been growing their continuing and executive education programs — offering shorter business school programs for executives who make over $10 million a year for instance. In the last 10 years, revenue from these programs doubled, providing the university with significant funds to fill the gap from underperforming endowments. Most schools don’t have the branding or access necessary to appeal to millionaire executives and business leaders. However, setting up corporate training or career enhancement training with local companies provides additional funds and increases your reach to nontraditional students.
Campus dining makes a profit. Schools like Notre Dame and Southeast Missouri State University have recognized the potential for their auxiliary services to bring in significantly more money than it costs to run the services. Food is especially one of those areas where students are willing to pay extra for good quality or healthy options. Another way to make money with food is to set up a campus farmers market where vendors can pay for space to sell their wares and the campus agriculture programs can sell what they produce.
Development isn’t new to education. Creating endowments that provide yearly returns give institutions a stable income that isn’t dependent on enrollment or state funding. While nothing will replace developing person-to-person relationships with philanthropic alumni when soliciting large donations, something that might work better and be more cost-effective than sending letters or cold calling alumni for small donations is crowdfunding. With schools like College of the Holy Cross raising close to $2 million in just 43 hours through crowdfunding, this increasingly common, free platform shouldn’t be ignored as a legitimate means to raise money with little cost to the institution.
- Surplus sales
Many colleges make money by having yearly, monthly or even weekly surplus sales. Rather than storing unused or left behind objects or adding them to landfills, put the forgotten items up for sale. The money made might not bring high dollars, but it is completely profit. The University of Washington runs a surplus shop open once a week. If having a physical location isn’t appealing, consider selling the merchandise in an online auction. Make sure to market the sales to the community and not just the students.
It’s hard to make money on YouTube, but not impossible. The chances of bringing in millions of dollars like some famous YouTube personalities are slim at best. However, there is still a potential return for colleges. Schools can earn ad revenue on this free platform while providing students with practical, real-world experience on a platform they will likely use. Generation Z watches YouTube like baby boomers watched television. A presence on the platform could help with recruitment, student retention and engaging the students with what’s happening on campus.
- eCommerce site
Whether or not you have a physical store that sells spirit wear, it is important to also have an online option. Companies like Promoversity will create a website for schools to sell school-branded spirit wear and merchandise. With Promoversity there is no inventory risk, no minimum order requirement and the school can make a profit.