AMS wipes out Swipe program

$8,294 spent on rewards program cancelled in June

An all-in-one student debit card and coupon card program was cancelled before students could begin to use it. AMS students would have used the card at local Kingston businesses and all AMS venues.

The program was cancelled in June after a partnership between the AMS and Givex, a Toronto-based company, did not meet AMS needs.

“It was certainly a technology that worked but not a technology that met our goals,” said Ian Black, VP (operations). “The technology company had a different interpretation of how the program would operate.”

Black said one of the main problems with the program was the money local businesses would need to pay to partake in the system.

“The problem with its technology was that it required local retailers to pay into the program in advance and didn’t provide students with benefits,” Black said.

Givex would have funded the start-up costs for the program’s first year, the cost to create the technology and the cost to pay sales representatives to sell the program to businesses.

Mike Cotton, ArtSci ’07, was hired as Swipe co-ordinator in the spring.

“We needed the start-up capital,” he said. “That was Givex’s role. In return they were taking two per cent of all transactions up until they broke even … Then profits would be split evenly between the AMS and Givex.” Cotton said he believes Givex spent substantial amounts of money on the project, although he couldn’t give the exact figure the company spent on the project because they never told the AMS.

Dan Jacob, AMS media and volunteers director, said Givex never gave the AMS any quotes as to how much the project would cost.

“We went into the partnership with the understanding that Givex would … invest the money that we felt was necessary,” he said. “Those quotes didn’t become available to us … There was sort of a written and verbal agreement that they would cover those costs.”

Cotton said Givex also paid for two student sales representatives to sell the program to local businesses.

The representatives made $600 each working part time before the program was cut.

Cotton said one problem with the deal, however, was Givex wasn’t able to create the customized discounts participating businesses had in mind.

“The original idea was that you could tailor the technology into discounts on certain items on certain days,” he said. “The only way they could do it was to provide a blanket discount.”

The major problem with the program, however, was that businesses were required to provide an investment of roughly $1,000 each.

Cotton said Kingston businesses and AMS services weren’t interested in investing that amount of money in the project.

“We couldn’t explain to Givex that this is Kingston, not Toronto, and that these businesses wouldn’t give that money up front,” he said. “It wouldn’t work with AMS services because they run such small profit margins as it is.” Cotton said after the Givex partnership fell through, the AMS created several alternative business plans to implement the idea.

They later consulted with Wells Hospitality, a local Kingston business, which would have been able to implement the program for an initial cost of $60,000 to 65,000.

Ultimately, Cotton said, the AMS wasn’t willing to spend that much money on the program. “We could’ve charged $3 per card but it was meant to be a program for being part of the AMS,” Cotton said. “People in the AMS weren’t willing to advocate tens of thousands of dollars.”

Cotton said the program’s only problem is a lack of financing.

“Once the program is there, the program can work,” he said. “It’s just a money thing.”

Jacob said that, once the program was deemed unfeasible, the position of Swipe co-ordinator was terminated.

“It’s no longer in existence,” he said. “The AMS invested $8,410. $8,294 of that was a salary for the Swipe co-ordinator and the sales reps as they were trying to launch the program.”

Cotton was saddened by the loss of his job.

“It was obviously really disappointing, it was more disappointing that the program didn’t happen,” he said.

Cotton said he’s working on a Swipe transition manual which would help any future AMS governments interested in running a similar program.

“They’ve been trying to do this six or seven times [before] with the AMS,” Cotton said. “This was the closest we had come.”

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