Extension of purchasing power through use of approval plans rather than standing orders for monograph-like materials

Extension of purchasing power through use of approval plans rather than standing orders for monograph-like materials

Extension of purchasing power through use of approval plans rather than standing orders for monograph-like materials

Keywords: Purchasing, Collection management, Serials, Vendors

Impact of acquisition method upon cost of material

Acquisitions departments are charged with obtaining material as quickly, cheaply and efficiently as possible. It is not easy to determine how soon a book or serial should arrive because it is very difficult to determine the actual date of publication. In addition, if the material is being purchased through a vendor who warehouses and re-ships materials instead of drop-shipping them, one must add time for the publisher to ship the material to the vendor before expecting delivery. Likewise, it is somewhat difficult to figure out how efficient an acquisition process is; however, one can develop flow charts and ask why various steps are performed and tweak any process to a more refined one. Also, one can get some handle on how the acquisition method affects the purchasing power. This column reviews some of the issues related to two methods of acquisition for monograph-like material: standing orders and approval plans, and how the three goals are affected by those decisions.

Institutional background

The acquisitions department in the Academic Affairs Library at the University of North Carolina at Chapel Hill currently has 5,000 titles costing roughly $500,000 annually on standing order. The categories included in this method of acquisition are monographs in series (numbered and not numbered), sets, annuals, and irregular publications. The department also has two major domestic approval plans through which it receives approximately 23,000 volumes annually, many of which are parts of series. The selectors monitor the profiles closely. Also company representatives meet with acquisitions staff and selectors to ensure that the plans are continuing to meet our needs. The standing orders, on the other hand, are less well attended to, with virtually no review by selectors and attention from the vendors often triggered mainly by our claiming practices.

Predicting expenditures for approval plans and standing orders

The primary reason that standing orders are established is to ensure receipt of all volumes in the set or series. Therefore, the funds for these ongoing obligations must be allocated off the top of the library materials budget. Another implication is that, because the orders are already placed, acquisitions librarians believe that they can do better projections of the anticipated expenditures. In truth, this cost projection is a very difficult and inexact science because the publication patterns are actually not really predictable at all. At the UNC-CH Library, we have not been able to anticipate exact receipts and costs because of this unpredictability. Vendors likewise must handle titles differently depending upon this predictability or lack thereof. Jett McCann (2001) of EBSCO in an e-mail correspondence with me indicated that in addition to "regular" standing order titles, EBSCO's policy is to treat a title as a standing order when the publisher is unable to provide information regarding the expected publication schedule and prices. EBSCO's Publisher Services Department works with publishers to help them understand the value of both reliable publishing schedules and pre-pricing to the library world. Putting these unpredictable titles on the approval plan risks reliable delivery and will only help with these projections marginally in that approval plan profiles can be tweaked to match budgetary realities.

Cost comparison between approval plans and standing orders for monograph-like materials

When comparing the costs between the two methods of acquisition, one can use information from established accounts, regardless of whether the same vendor is used for both methods or whether the vendor is a monographic or serials one.

Regardless of the source used, the two methods do have three similar costs associated with them. The first one is discount. When the material is acquired through an approval plan, there is typically a greater discount because the approval vendor is buying in larger quantities. Also, the vendor is not guaranteeing delivery of all volumes of the title nor tracking of the series, title changes, or publisher changes. This discount is often enriched through the use of deposits because of fairly predictable receipts. When the material is acquired through standing order with a monographic vendor or a serials vendor, the discount is typically less than the approval account because more services are offered, such as claiming overdue volumes and purchasing backfile volumes. When the material is acquired through a serials vendor, the discount also depends upon both the publisher's and the vendor's policies; however, there typically is no discount.

The next cost is shipping charges. Various vendors handle these differently. Sometimes, the customer can negotiate a discount that includes no shipping charges for an approval account or a standing order account with a monographic vendor. Currently, one could use 4 percent of the total cost as the anticipated expense for shipping if the library must pay it. This 4 percent sometimes must be added to the cost of materials received through a serials vendor as the material is drop-shipped directly from the publisher, and the serials vendor pays the publisher's shipping charge and includes it in the cost billed to the library.

The last cost is the labor involved with each method of acquisition. Here, one must compare the steps necessary to order, receive the material, and process the invoices. There may be advantages to the approval plan especially if the library's automated acquisitions and serials system allows for FTP of electronic records (bibliographic, order, and invoice), which decreases the time required for receipt and processing. On the other hand, the serials vendor's electronic interfaces with ILS vendors may allow for easier check-in and claiming. Standing orders may or may not require more processing time than the approval approach depending partly upon whether the library can take advantage of the electronic options. Another labor issue to consider might be that the shipments and invoices from the monographic vendor are aggregated; whereas, the direct from publisher shipments are multiple shipments and more small invoices to process, all of which is added labor. Nonetheless, if you need series work segregated for monetary or organizational reasons, that may be the determining factor regarding the choice. For example, if the series are coming all mixed in with other approval plan books, it makes it harder to cull out the series and check them in, if the department is still maintaining check-in records.

Delivery times to be expected with each acquisition method

The speed with which the library receives the standing order material depends on a number of factors. The first factor is the efficiency of the publisher itself in supplying materials to its customers, whether they are vendors or libraries. The second factor is the type of vendor used. If a serials vendor is used, the material should arrive more quickly because it is sent directly from the publisher. If a monograph vendor is used, the material will take a detour through the vendor's warehouse and re-shipping process before being delivered. The third factor is the choice of shipping used by the supplier. Also, while in theory, an approval copy should arrive faster than a standing order one from the same monograph vendor; in practice, the delivery time could even differ within the same company depending upon how integrated they are and which division is more on top of buying or what delays are introduced by the cataloging process for other approval customers.

Steps for changing the acquisition method from standing order to approval

Because there may be significant savings in moving from the standing order approach to the approval plan process, especially for monographs in series, acquisitions librarians should consider carefully what steps are necessary to make these changes. The following suggestions detail what actions should be taken to accomplish this task with maximum efficiency and effectiveness:

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  Decide when a standing order is required even if the title can be supplied through approval. The primary criterion for this would be the level of control the selector wants to have over a particular title. Titles in monographic series and annuals fit well with the approval process because they may not require special monitoring. Irregular publications and sets may, on the other hand, fit better with the standing order process in order to provide more bibliographic control.

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  Develop a list of the titles to be considered, excluding the ones requiring a high level of control, and send to vendors for a quote on which titles they can supply, how (approvals, standing orders, not at all), and for how much. I asked our domestic standing order vendor to analyze how many of our current standing order titles could be switched to the existing approval plans. The results were that only 40 percent were appropriate for the approval process; the other 60 percent needed to be handled through a continuations or standing order program. Some titles cannot be treated on approval for various reasons such as the publisher is not one covered as part of the approval plan, the publisher requires prepayment, or the title requires more intensive tracking by the vendor to ensure complete coverage.

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  Review the vendors' responses and evaluate financial consequences. Would the library get a better discount from the vendor? If so, what would be the impact upon the library's budget? This question draws in the selectors, the administration, and accounting as well as acquisitions. Without revealing the exact financial arrangements with the vendor noted above, I can indicate that the approval discount is approximately twice that of the standing orders. Extrapolating from hypothetical discounts of 5 percent and 10 percent and using the list provided by the vendor, it appears that this library could save approximately $5,000 annually by moving some existing standing orders to the approval plans. With an annual average price of $42, this move would enable the library to acquire approximately 120 more books per year. If the same trend held true across all 5,000 standing orders, this library might be able to save $25,000 per year although the savings would depend upon the arrangements, especially those with foreign vendors.

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  Evaluate value-added services that the vendors can provide. For example, can the vendor provide duplication control (whether or not all orders are with that vendor)? Can the vendor provide cataloging records and shelf-ready processing? Can the vendor provide management reports? Does the vendor provide Web-based access to its databases? How complete and accurate are the data? How important are these services against the cost savings?

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  Evaluate the benefits gained from greater scrutiny of titles acquired against the time required for selectors to review more materials. How many of the titles on standing order fall within the current approval plan profiles? If there are many volumes that do not fit the current selection policy, the library can save by not automatically acquiring materials that are out of scope if you tell the vendor to follow the regular approval instructions for the series rather than having all volumes sent automatically.

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  If the library decides to move some standing orders to approval, design procedures, in conjunction and hopefully with the help of the vendor, and begin the transfer process. As Breaux (2001) notes in her article on considerations for using a monograph vendor for standing orders, there are transition issues that must be carefully coordinated with the monograph vendor.

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  Monitor the outcomes and evaluate the success of the project based upon the three criteria for service: speed, efficiency, and cost. Are you obtaining the material more quickly, with less effort and at a lower cost?

Standing order required: considerations regarding vendor choice

Despite the importance of considering approval plans as an alternative acquisitions method, there clearly are times when the only method to be used is the standing order. The acquisitions librarian may determine that the title really should be acquired through standing order rather than approval, either because of the selector's desire for control or the vendor's inability to handle the title through the approval process. He or she then has another set of decisions to make regarding which type of vendor to use, a monographic vendor or a serials vendor. The economics of standing orders is quite different than that of subscriptions where there is up-front cost recovery.

Therefore, serials vendors often treat standing order material in a different manner as a continuation because of unpredictability of the publication schedule and costs. There are advantages and disadvantages to the use of either type of vendor, so the librarian must carefully weigh the needs of his or her institution in making this decision. Table I indicates the major differences. In addition to weighing these issues, the librarian must also consider other factors to choose the right vendor, including customer service, experience with the vendor, and possible extended purchasing power through leveraging several accounts together.

Conclusion

The use of approval plans for material that might also be received through standing orders or continuations is a possible way to extend purchasing power. Likewise, there are cost implications related to which type of vendor is used for the titles that must be acquired through standing order or continuations. Because there are many variables to consider, it is important for acquisitions librarians, collection development officers, and administrators to understand those variables and to work closely with their vendors to identify which acquisition method is an appropriate strategy for their own library and which type of vendor is best qualified to meet the library's needs.

The author wishes to thank Jett McCann and Ann-Marie Breaux for their generous and excellent advice and insights into how their respective types of vendors handle standing orders.

Janet L. FlowersHead of Acquisitions, Academic Affairs Library, University of North Carolina at Chapel Hill, North Carolina, USA

References and further readingAlessi, D. and Goforth, K. (1987), "Standing orders and approval plans: are they compatible?", Serials Librarian, Vol. 13, October-November, pp. 21-41.Breaux, A-M. (2001), "Purchasing continuations from a monograph vendor: some considerations", Library Collections, Acquisitions and Technical Services, Vol. 25 No. 3, pp. 329-35.

Flowers, J. (2001), "Standing orders: considerations for acquisitions method", Library Collections, Acquisitions and Technical Services, Vol. 25 No. 3, pp. 323-8.McCann, J. (2001), "Follow-up questions", e-mail to Janet L. Flowers dated April 30, 2001.Miller, H. (1998), "The monographic series approval plan: an attempt to refine purchasing of books in series", Library Resources and Technical Services, Vol. 42 No. 2, pp. 133-9.

Rouzer, S. (1995), "Acquiring monographic series by approval plan: is the standing order obsolescent?", Library Acquisitions: Practice and Theory, Vol. 19 No. 4, pp. 395-401.

Warzala, M. (1991), "Acquisition of monographic series: approval plan versus standing order", Library Acquisitions: Practice and Theory, Vol. 15 No. 3, pp. 313-27.