Consistent with national economic trends, Associated Students UCLA, the institution that runs all of UCLA’s restaurants, services, the student store and virtually all of Ackerman Union, has suffered net losses both in recent months and since this time last year.
Figures released late last month for December 2008 show that sales are off by 4 to 5 percent since the start of this fiscal year, down nearly $2 million since July.
The organization is supported in part by student fees amounting to over $40 per student per year.
Though causes for the shortfall are relatively uncertain, ASUCLA representatives speculate that the leading contributor is the downward national trend in nonessential discretionary spending.
“We are pleased with our results in that we haven’t been off as much as some other retailers,” said Rich Delia, chief financial officer for ASUCLA. “But the sales declines are accelerating. The economy has been really starting to get worse, and we’re not immune to that.”
Most major retailers have experienced losses in excess of 10 percent over the last several months, but ASUCLA has been able to mitigate these effects through a number of proactive choices, Delia said.
“We have cut travel expenses for the whole association. We’ve cut advertising, just like a lot of retailers. We’re cutting supplies. If a position opens we’re looking to consolidate or not have to replace that position,” he said.
Delia said that the association has also been able to save money by temporarily suspending a scheduled merit-based pay increase of 4 percent for nonunionized career employees.
Many of the fields that have shown decreases on monthly and yearly scales have been affected by reduced discretionary spending, which accounts for a large portion of UCLA’s BearWear, computer products and nonacademic book sales.
Although ASUCLA currently has nearly $16 million in cash and short-term investments and just over $50 million in total assets, many of these funds are already tied up in other projects including renovations to the Cooperage ($3 million) and the Bomb Shelter, soon to be renamed the South Campus Student Center ($8 million).
But while things do not look good, members of the ASUCLA Board of Directors remain optimistic about the organization’s success for this year and subsequent ones.
“The good news is that our sales are only down a few percent as opposed to the double-digit decline in the the rest of the economy. That’s a good signal,” said Jared Fox, a sixth-year graduate student in computer science and public policy, and a graduate representative on the board. “Some of the numbers are provisional, but I don’t think that we’re going to lose any significant money this year.”
Netta Avineri, the board’s vice chair, said ASUCLA had experienced a few years of somewhat unusual success prior to this year, which she said can make current figures look deceptively bad.
“The association has been experiencing such success up to this point; we’re not in such of a panic mode because we’re in such a better situation than we were 10 years ago. I know that the management is doing a lot to be proactive, considering the realities of the world economic situation,” Avineri said.
Speculations regarding the long-term longevity of ASUCLA as an organization are not up for consideration, executive director Bob Williams said.
“ASUCLA is in the strongest position it has ever been in in terms of its cash reserve,” Williams said. “In some sense, our results this year are down in comparison to some really good years. Of course if our sales stay below our planning in the long term, we would adjust our cost structures, change our labor and find ways to make our budget work. … But there is no risk of us doing that in the short run.”