AMS services will post loss overall

Service directors estimate that loss will be between $30,000 and $40,000

Jenn Hirano, VP (Operations), is responsible for reviewing the annual AMS budget.
Jenn Hirano, VP (Operations), is responsible for reviewing the annual AMS budget.
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Destinations was the most profitable of the new AMS services this year.
Destinations was the most profitable of the new AMS services this year.
Photo: 

In a year during which the AMS revamped and reincarnated several of its services, the books reflected the financial downswing: altogether, the services are predicted to post a net loss of $30,000 to $40,000 for the year.

“We went into this knowing that the services would lose money this year,” said Student Services Director Ashik Bhat. “You don’t just start three new services and expect to make a ton of cash.”

One of the year’s biggest success stories, however, is a somewhat new service: Destinations, which took over the sale of Tricolour bus and event tickets from the former UBS, currently stands to gain $10,000 more than had been projected. The most up-to-date budget, dating to the end of February, placed Destinations’ profit at $144,000.

Bhat said after all wages and bills are paid at the end of April, the service’s profit margin will stand at about $50,000, as compared with a budgeted $37,487 profit.

“Destinations actually exceeded our expectations entirely,” Bhat said. “Ticket sales have just skyrocketed.”

Bill Howe, Destinations head manager, agreed.

“I attribute that [profit], obviously, to the continuation of the success of Tricolour,” he said.

One problem Destinations ran into this year, however, was in providing students with ISIC cards. Howe said that problems with a printer prevented Destinations from selling ISIC cards for much of the year, but that this problem has recently been solved.

The Tricolour Market is another new AMS service, but it did not fare as well financially as Destinations.

The service, which the AMS purchased at the end of last year, is currently posting an $81,000 loss.

“It was obviously a transition year,” said Richard Zussman, Tricolour Market manager. “We tried to sort of refocus what the store did.”

Among changes implemented to turn Tricolour Market into a “real student service” were renovations and a change in merchandising lines, Zussman said.

“These [renovations] are costs that we thought we would do a little bit, bit by bit, but we decided that the best thing to do was in the first year,” he said.

The service also purchased almost $27,000 of old merchandise from the former owners that the AMS was unable to sell, Zussman said.

The end-of-year bottom line for Tricolour will probably put the business at approximately a $50,000 to $60,000 loss, Bhat said, about $20,000 more than budgeted. He added that while next year’s Tricolour management will find the business more financially stable, the service will not be expected to make a profit.

The Greenroom is another new AMS service this year currently posting a loss: $32,000.

Head Manager Farron Blanc said the loss was par for the course for a new service.

“We made a lot of mistakes, but we also found a lot of good opportunities for next year’s managers to pursue,” he said. “There’s a lot of room for them to find new areas and grow.”

Blanc said that while some of the merchandising choices Greenroom managers made were “kind of stupid” in hindsight, the year has been a learning experience.

“There’s a really narrow margin for error,” he said. “Although we do know our market, [we] don’t really know it as well as [we] think [we] do.”

Blanc added he thinks that if future managers focus on increasing sales on consignment books and better publicizing the Greenroom, the service could turn a profit in the near future.

One of last year’s hardest-hit services financially was The AMS Pub Services (TAPS). TAPS lost more than $100,000 in the 2004-05 year. At present, TAPS is looking at a year-to-date loss of $64,000, a loss expected to decrease further before the end of the year.

Food and Entertainment Director Julie Hirst said this figure is $40,000 better than projected, a success she attributed to high sales at Alfie’s and the QP this year.

Hirano said the loss is also partly explained by factors such as rent and the administrative charge services pay to the AMS.

“[TAPS is] actually doing significantly better than they thought they’d be doing at this point in the year,” she said. “They’re posting a loss, but they’re actually profitable in terms of their operations.”

Head Manager Ian Anderson characterized TAPS’s current financial situation as “a big turnaround” compared with last year’s losses.

He said the biggest success this year is the atmosphere the service has been providing students.

“We don’t sell pints and Caesars, we sell the student experience,” he said. “[Increased sales] means people are having a good time at a safe, on-campus pub where they can be served by their peers in a friendly and fun atmosphere.”

Hirst said there was “no hope” of TAPS making a profit this year, but it may be possible in coming years.

“So long as people continue to build on the success of the last couple of years, we should be doing far better.”

One of last year’s two most successful services, the Common Ground, didn’t fare as well this year. The service is currently posting a loss of $22,000.

Head Manager Omar Kadrie said the loss was caused primarily by significant renovations and additions made to the business this year, as well as increased rent and higher payroll expenses due to more staff hours.

“We changed a lot of how things were done at the Common Ground in order to increase efficiency, and we had to make all those changes at one time in order to make it a worthwhile venture before we move to our new location [in the Queen’s Centre],” he said. “Whenever you kind of shock a service, you need some time for it to rebuild back to the level that it was.”

While a significant amount of money went to repairs and new equipment, Kadrie said the Common Ground was able to serve and pay wages to more students than in previous years.

“Our sales this year are almost $100,000 over what they were last year, which is a success because it means we’ve been a lot more efficient in terms of staff, expansion—all that has worked for us,” he said. “We’ve paid more student wages, but we’ve also served more students.”

One area in which the Common Ground didn’t make as much money as projected was catering.

“Because of all the changes and all that that went on, we weren’t able to push catering as much as we wanted to,” Kadrie said.

Nevertheless, the Common Ground bought a catering trolley this year that Kadrie said can be used in future years if managers choose to focus on expanding that service.

The Queen’s Entertainment Agency (QEA) lost almost $38,000, compared with a $19,000 loss last year, and $74,000 in 2003-04.

Hirst said the loss hasn’t prevented QEA from being a valuable student service, however.

“The QEA ran a couple [of] large events like Broken Social Scene and Metric,” she said. “It was actually our smaller events that weren’t as successful.”

Hirst added that while future QEA managers may want to supplement their student fee by exploring sponsorship options, the service’s focus has been on increasing resources for clubs and students on campus.

CFRC campus radio was in an unusual financial position this year, as it prepared to be without University funding for the first time as it nears the end of a three-year transition period. Part of this year’s financial strategy was a fundraising campaign that raised more than $10,000.

Business Manager Sayyida Jaffer said the fundraising drive was a success, and is something CFRC will try to repeat in future years.

“We definitely ended in a better financial position than we anticipated,” she said. “The community’s always been a backbone for CFRC, and I think the funding drive made people realize that.”

CFRC finances are currently registering a $21,583 profit, although this figure is expected to decrease by the end of the year.

Jaffer said the next couple of years will be difficult for CFRC financially, as it must make up for the loss of an annual $48,000 University grant.

“Hopefully we can think of a way to keep CFRC alive and well on campus,” she said.

The Journal was another financially successful service this year, currently projected to earn a $45,000 profit at the end of the year.

Business Manager Jim Nicholson attributed this to increased ad revenue due both to higher campus rates and increased advertiser demand.

Nicholson emphasized that advertiser demand isn’t a guarantee, however, and that the increase in the Journal’s student fee is also crucial.

“[The increased fee] gives us a lot more breathing room for when things go badly with the economy,” he said.

Nicholson added he was able to negotiate a better printing contract for the year, allowing for the printing of more content-heavy papers.

“We’re definitely still fulfilling our mandate to provide news to the student community while remaining financially sustainable,” he said. “We’ve shown that it is possible that we can cover the cost of the newspaper and provide meaningful issues to student readership.”

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