With the last few years causing significant change in the higher education landscape, colleges and universities are learning to navigate trends of declining enrollment, reduced funding for public institutions, and inflation. In a recent survey of higher education leaders, 53% of participants stated that one of the biggest challenges they’re facing is declining enrollment and retention rates, second only to budgetary limits (Seltzer, 2022).
In the midst of declining enrollment, how can higher education leaders ensure that their institutions continue to generate sufficient revenue to continue operations and achieve goals?
One key strategy for expanding institutional budgets and ensuring continuity during this time is establishing new and diverse revenue streams. After improving student enrollment and retention, 74% of college leaders stated that seeking new revenue opportunities was a top priority for the upcoming school year (Seltzer, 2022).
Here are five ways institutions of higher education can seek out new revenue streams:
Leverage Existing Space
Some schools can optimize existing campus assets to maximize incoming revenue. For example, campus buildings can be used as conference rooms or other types of accommodation during the summer months. Unused space can also be rented out for various purposes, as the University of Wisconsin Oshkosh demonstrated when they rented out campus building space for cell towers (Pelletier, 2012). Some schools also utilize dorms for summer sessions and/or provide housing for students who choose to stay and work over the summer.
Investing in new assets can make the school an attractive option for incoming freshmen while simultaneously bringing in more revenue. Castleton University purchased and revamped a regional fieldhouse for athletics that features a fitness center and rental options (Pelletier, 2012). NorQuest College established an on-campus bank that’s expected to generate an additional $100,000 per year in revenue (Steele, 2020). With a bit of creative thinking, the possibilities are virtually endless.
Focus on Non-Traditional Student Populations
As declining enrollment numbers suggest, higher education standards are changing, including the outdated stereotype of four-year, on-campus students as the ideal population. To maximize revenue opportunities, colleges and universities should consider expanding their focus to non-traditional student populations, such as international students and students from rural communities.
A survey by Rooted Alliance Inc. states that only 33% of rural youth between the ages of 18 and 24 enrolled in further education after graduating high school. This leaves a huge pool of potential candidates for college admissions that is often overlooked (Morrone, 2021).
Alternatively, schools can boost outreach efforts to alumni or professionals with a college degree who might need to pursue continuing education or advanced degrees. Institutions that are set up for online education might consider establishing a membership model to allow ongoing access to courses (Morrone, 2021).
Work with the Local Community
In many cases, colleges and universities are major employers within the local community — especially when it comes to small colleges with a strong local presence. Schools can form partnerships to create mutually beneficial revenue opportunities for both the institution and local businesses, such as offering discounts and promotions during homecoming weekends or developing collaborative advertising strategies (Morrone, 2021). Establishing employment programs with local employers could also help improve student enrollment metrics.
Offer Complimentary Services
Another new revenue strategy popping up in higher education is commercializing academics. Colleges and universities have the resources to provide services to both small businesses and corporations, so why not take advantage? Examples include establishing a childcare program in which early education students can gain experience working with children or providing consulting services to local small businesses.
Institutions are also creating entrepreneurial incubator programs that help students develop and bring new ventures to market. These programs often include benefits to the university when the ventures are successful, such as royalties or agreements for future philanthropy (Steele, 2020).
Engage with Alumni
Some colleges and universities have a strong base of alumni that continue to attend college events and be involved in the overall culture throughout their lives. Engage young undergrad alumni early to promote your graduate degree programs. Make sure to keep older alumni in the loop by inviting them to events, sending them e-newsletters and mailed newsletters, and of course, asking for donations throughout the year.
Here’s an out of the box idea that we found through our research! Approximately 50 colleges and universities have also established new alumni-focused revenue streams by creating on-campus retirement villages for those who want to spend their retirement years immersed in the culture of their alma mater (Steele, 2020).
Uncovering new revenue streams not only helps ensure the continuity of higher ed institutions within a constantly evolving landscape, but it can also provide benefits to students, staff, and local community members. While this is a challenging time for higher education as a whole, it also presents an opportunity for new growth strategies, innovation, collaborative partnerships, and out-of-the-box solutions that can benefit colleges and universities for years to come.
Bonus Idea! Partner with PLS 3rd Learning
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References
Morrone, D.J. (2021). Rethinking revenues, preserving resources in higher education. Grant Thornton. https://www.grantthornton.com/insights/articles/nfp/2021/rethinking-revenues-preserving-resources-in-higher-education
Pelletier, S.G. (2012). Rethinking Revenue. Public Purpose. https://www.aascu.org/WorkArea/DownloadAsset.aspx?id=5569
Seltzer, R. (2022). College leaders seek new enrollment, revenue sources in upcoming year, survey says. Higher Ed Dive. https://www.highereddive.com/news/college-leaders-enrollment-revenue-survey/635659/
Steele, K. (2020). Supporting the Academic Enterprise: Entrepreneurial New Revenue Streams for Your College. Innovatus: The Magazine of the League for Innovation in the Community College. https://innovatusmagazine.com/supporting-the-academic-enterprise-entrepreneurial-new-revenue-streams-for-your-college/
