Analysis of Costs and Income of the M.S.U.F.C.U ATM Network*

Brian R. Armstrong
Jeffery K. Barron
Jeffrey D. Elgas

April 26, 2002

Abstract. We examined the profitability of the automated teller machine (ATM) service provided by the Michigan State University Federal Credit Union (M.S.U.F.C.U) for one month. The cost of operating each M.S.U.F.C.U ATM in the 76-machine network was determined. We constructed a tool for determining the monthly profit for the M.S.U.F.C.U ATM network. Observations were made concerning the relationship between ATM profitability and distances from the M.S.U.F.C.U. Simulations of surcharges for guest transactions were performed.

* Work done for the Michigan State University Federal Credit Union under the direction of Jeffrey G. Jackson, Vice President of Finance, in partial fulfillment of the requirements of Michigan State University MTH 844, advised by Professor Gábor Francsics.
Table of Contents

Introduction…………………………………………………………………………..…… 3

Experimental Data From the M.S.U.F.C.U ATM Network………………………..… 3

Experimental Data Analysis of Revenue…………..………………………………..… 4

Experimental Data Analysis of Costs….…………...………………………………..… 5

Experimental Analysis of Distance versus Profitability ……………………………... 5

Experimental Analysis of Surcharges….……………..……………………………..… 6

Recommendations……………………………………………………………………..… 8

Future Work……………………………………………...……………………………..… 8

References………………………………………………………………………………... 9

Appendix A. ATM Specifications and SCC Pricing.………………………………..… 10

Appendix B. ATM Specifications and NYCE Pricing…………………………..…….. 11

Appendix C. ATM Revenue………..…...…………………………………...……..…… 12

Appendix D. ATM Revenue, Costs, and Profit……………………………………..… 13

Appendix E. Summary of Surcharge Results.….…………………………………..… 15

Appendix F. Jersey Giant Locations and Distances from M.S.U.F.C.U…...………..… 16

Disclaimer. The data used in the experiment of this project is not actual data measurements or observations of the Michigan State University Federal Credit Union. However, by the direction of the M.S.U.F.C.U, the project experiments have been performed and conclusions have been drawn as though the data were actual for one month.
Introduction

One of the leading services that the Michigan State University Federal Credit Union (M.S.U.F.C.U) provides its members is a 76-unit network of automatic teller machines (ATM). The credit union, like most financial institutions, provides the ATMs as a convenience to customers (members and guests) that need remote banking services [1]. The M.S.U.F.C.U’s machines are available in many locations throughout the MSU campus, the greater Lansing area, and greater Detroit area to increase availability of service. This service, however convenient to credit union members, is expensive due to network charges, maintenance, and upkeep. Our goal was to analyze this service system and determine the profitability of each ATM. Once the data for the month of December 2001 was obtained from the credit union, we used it to hypothesize about changes that could be made to the system in order to better serve customers, yet retain profitability for the credit union. There were several variables to consider: (1) Users of the machines (members or guests or both), (2) What cost is associated with each transaction made, (3) What is the profitability for each ATM, and (4) what is the cost of maintaining each ATM (i.e., maintenance, service, etc.). The formulas for computing revenue are shown in Tables 1 and 2. These were evaluated with Microsoft Excel using the Network data that appears in Appendices A and B. The results are tabulated in Appendix C.

Experimental Data from the M.S.U.F.C.U ATM Network

The data used in the analysis of the ATM Network was in the form of an Excel worksheet provided by the credit union [3]. We had information about every ATM location, the number and types of transactions made, and the charge from the network of each transaction (see Appendices A and B). Costs are related to who uses the machine (i.e., members and nonmembers) and what kinds of transactions are made. Members of the M.S.U.F.C.U who use the ATM's are not charged for the transaction. However, there is a cost to the credit union from the network each time a transaction is made. The MAC/SC24 Us-On-Us network charges $ 0.075 for each member transaction (see Appendix A). This charge is paid by the M.S.U.F.C.U, so the credit union loses money on member transactions. Nonmembers, or guests, are also not charged by the credit union to use ATM's. A network cost is still involved, but the credit union charges the guest’s home financial institution. So the credit union, in general, makes a profit on guest transactions. The charge per transaction can be seen in Appendix A. Our goal was to analyze the profitability of each ATM. We hypothesized that the credit union would lose money on ATM transactions. This idea was based on the fact that most machines are located in areas where the prominent users are anticipated to be members. We would hope, however, that nonmembers would also use the machines, and thereby generate some revenue, but only enough to lighten the financial burden of the credit union. Through our testing, we rejected our hypothesis and found that there is an overall positive profitability from ATM transactions, with the mainstream of profitability stemming from the Quality Dairy stores.

Experimental Data Analysis of Revenue

The first step in analyzing the data was to understand the Excel workbook [3]. We found that the book was split up into two main categories: transactions and pricing. There were two different pricing standards: (1) Service Center Corporation (SCC) pricing and (2) New York Cash Exchange (NYCE) pricing. The “Transaction Count,” “SCC Pricing,” and “NYCE Pricing” are separate sheets in the Excel workbook. We used Excel to aid in the computations of the revenue. The algorithm for the computation is:

| |
|Transaction Count = TC |
|SCC Pricing = SCC |
| |
|Network Revenue for ATM # = (TC inquiry) * (SCC inquiry) |
|+ (TC account list) * (SCC account list) |
|+ (TC denial) * (SCC denial) |
|+ (TC deposit) * (SCC deposit) |
|+ (TC envelope entry) * (SCC envelope entry) |
|+ (TC payment transfer) * (SCC payment transfer) |
|+ (TC withdrawal) * (SCC withdrawal) |
|+ (TC transfer) * (SCC transfer) |
| |
|Inquiry = account balance |
|Account List = list of all accounts |
|Denial = wrong PIN, insufficient funds, etc. |
|Deposit = depositing money into account |
|Envelope Entry = entering an envelope into machine slot |
|Payment Transfer = moving funds from one account to pay a bill |
|Withdrawal = taking funds from an account in the form of cash |
|Transfer = moving funds from one account to another |

Table 1. Network Revenue Formula.

We multiplied the transaction count by the SCC pricing to calculate the machine revenue for a particular network (CIRRUS for example). The process was repeated for each network. We only needed to make a template of formulas for one network and copied these formulas to the other networks within Excel. The only exception to this template is the NYCE network. The credit union pays for the service for NYCE users before billing NYCE (which amounts to a profit). The following adjustment to the algorithm was made:

| |
|Transaction Count = TC |
|SCC Pricing = SCC |
|NYCE Pricing = NYCE |
| |
|NYCE Revenue for ATM # = (TC inquiry) * (SCC inquiry) * (NYCE inquiry) |
|+ (TC account list) * (SCC account list) * (NYCE account list) |
|+ (TC denial) * (SCC denial) * (NYCE denial) |
|+ TC deposit) * (SCC deposit) * (NYCE deposit) |
|+ (TC envelope entry) * (SCC envelope entry) * (NYCE envelope entry) |
|+ (TC payment transfer) * (SCC payment transfer) * (NYCE payment transfer) |
|+ (TC withdrawal) * (SCC withdrawal) * (NYCE withdrawal) |
|+ (TC transfer) * (SCC transfer) * (NYCE transfer) |
| |
|Inquiry = account balance |
|Account List = list of all accounts |
|Denial = wrong PIN, insufficient funds, etc. |
|Deposit = depositing money into account |
|Envelope Entry = entering an envelope into machine slot |
|Payment Transfer = moving funds from one account to pay a bill |
|Withdrawal = taking funds from an account in the form of cash |
|Transfer = moving funds from one account to another |

Table 2. NYCE Network Revenue Formula.

The sum of the network profitabilities is the total revenue for each individual ATM. We found that the most efficient way to evaluate these calculations was to utilize Excel. After writing a formula in Excel, we found the revenue for each machine, which can be found in Appendix C. The total revenue for all machines was $ 193,949.59.

Experimental Data Analysis of Costs

After finding the total revenue of each ATM, we then turned our analysis to the costs associated with each machine. We had to consider maintenance, service, and rent. Every machine had a maintenance cost of $1200 and a service or cash-handling fee of $300 (less the two machines in the lobby of the credit union). There was rental fee of $1000 on the ATMs stationed in the Quality Dairy Stores. We subtracted these associated costs from the calculated revenue resulting in a profit or loss for each ATM. The total profit for the M.S.U.F.C.U ATMs was $51,047.09.

Experimental Analysis of Distance versus Profitability

In the next part of the project we found the profitability to distance ratio of each ATM [5]. All distances were measured form the M.S.U.F.C.U on 600 Crescent Road, East Lansing. The distance versus profitability is plotted in Figure 1. We can see from the graph that the most profitable machines are located between 2.4 and 15.1 miles from the credit union.

[pic]
Figure 1. Distance vs. Profitability.

Experimental Analysis of Surcharges

The next phase of the project was to simulate the effect of surcharging guests for use of ATM’s. In this section we hypothesize the effect of surcharges of three different amounts: $1.50, $2.00, and $2.50. Note, we inquired about any previous analysis that had been done with respect to surcharging, however, there had not been any performed. Therefore, our simulation was done on a strictly hypothetical basis. In order to aid in the profitability calculation, we calculated that on average the M.S.U.F.C.U loses $0.08 per member transaction and gains $0.54 per guest transaction. We have that the number of member and guest transactions for this month were 527,614 and 435,606, respectively. Our first simulation was in respect to a surcharge of $1.50. First, we needed to hypothesize the amount of customers that each ATM would lose, and secondly, the number of guests that would join the credit union in order to forgo the surcharge. We expect that the surcharge would increase the number of member transactions by 2%, but decrease the number of guest transactions by 5%. The simulations for surcharges of $2.00 and $2.50 were done in a similar fashion. The following table represents the results.

|Surcharge |Decrease in Guest |Increase in Member |Revenue |Initial Profit |Profit with |
|Amount |Transactions |Transactions | | |Surcharge |
|$ 1.50 |5% |2% |$181,482.13 |$38,282.13 |$659,020.68 |
|$ 2.00 |10% |3% |$169,410.39 |$26,210.39 |$810,301.19 |
|$ 2.50 |15% |4% |$157,338.65 |$14,138.65 |$939,801.40 |

Table 3. Summary of Surcharge Simulations.

Initially, we were shocked by the size of the hypothetical profits that resulted from surcharging since our original profit is $51,047.09. This inspired us to test several different surcharge/member-increase/ guest-decrease values. Even after assessing somewhat bizarre surcharge statistics, such as an 80% decrease in guest transactions with zero percentage member gain, a profit was still realized with a surcharge as low as $1.50. The large number of transactions (963,220 in our one-month data sample) substantiates the size of the profits. The supporting data for Figure 2 can be found in Appendix E.

[pic]

Figure 2. Simulation Results and Comparisons.

Recommendations for ATM System Alterations

Should the M.S.U.F.C.U decide to install more machines, it would be best served (statistically) by placing them in the 2.4 to 15.1 mile radius from the M.S.U.F.C.U on 600 Crescent Road, East Lansing. For the best interest of the credit union and its members, there should be a $1.50 surcharge for guest transactions. We recommend that the Excel worksheet we created be used with future data.

Future Work

We recommend that there be future consideration on the statistical analysis of adding surcharges to guest transactions. There is potential for a large profit without sacrificing member service. The M.S.U.F.C.U can service its members with the same quality while simultaneously increasing profit. On request from Jeff Jackson, we did preliminary work on the possible partnership with Jersey Giant Submarines, a submarine sandwich store chain with eight locations in the greater Lansing area. The most profitable ATMs were those placed in the Quality Dairy stores, therefore forming a partnership with another local chain is worth investigating. We found that six of the Jersey Giant Submarine facilities are located in the optimal ATM profitability region (2.4 to 15.1 miles from M.S.U.F.C.U). These locations and distances can be found in Appendix F. Other interesting research that could be performed, as a continuation of the work seen above, would be that of investigating the surcharges of other credit unions and banks. Also, one could review studies done in the fields of economics or finance pertaining to the effect of increasing banking fees. In closing, the work performed above might be further substantiated by constructing data for several months.
References

1] Jackson, Jeffrey G. Project Summary. “Analysis of Costs and Income from an ATM Network.” Michigan State University Federal Credit Union. . 2002.

2] MacCluer, C. R. Industrial Mathematics, Modeling in Industry, Science, and Government. Prentice Hall, New Jersey. 2001.

3] Mendoza, Kim. M.S.U.F.C.U Project Data. “Machine List, Transaction Count, SCC Pricing, and NYCE Pricing.” Excel Workbook. Michigan State University Federal Credit Union. 2002.

4] Michigan State University Federal Credit Union. . 2002.

5] Yahoo!, Inc. “Maps and Driving Directions.” . 2002

6] YellowPages.com, Inc. “Business Search.” . 2002.

Appendix A. ATM Specifications and SCC Pricing
|NETWORK |INQUIRY |ACCOUNT LIST |DENIALS |DEPOSIT |ENVELOPE ENTRY |
|45 |Q.D. 8512 W. Saginaw |$ 5,628.02 |670 |Q.D. 720 W. Jolly |$ 5,843.39 |
|47 |600 East Crescent Road (Inside) | $ 31.46 |671 |Q.D. 1200 W. Willow | $ 4,054.28 |
|630 |1925 W. Grand River (Inside) |$ (77.15) |672 |Q.D. 645 S. Waverly | $ 6,036.69 |
|631 |1925 W. Grand River (Outside) | $ 264.37 |673 |Q.D. 917 E. Cavanaugh | $ 5,057.35 |
|632 |MSU International Center-Right | $ 1,631.71 |674 |Q.D. 2121 W. Holmes | $ 6,285.17 |
|633 |Oakland - Kresge Library | $ 133.39 |675 |Q.D. 4500 W. Saginaw | $ 7,622.66 |
|634 |Oakland - 3625 East Pontiac | $ 1,139.07 |676 |Q.D. 947 Trowbridge | $ 1,263.03 |
|635 |600 East Crescent Road (Drives-West) | $ (215.61) |677 |Q.D. 173 Maple | $ 4,199.43 |
|636 |Oakland - 3000 University Drive | $ 843.05 |678 |Q.D. 5100 S. Waverly | $ 6,088.55 |
|640 |MSU The College Store-4790 S. Hagadorn | $ 201.48 |679 |Q.D. 5930 Marsh Road | $ 3,265.21 |
|641 |Q.D. 1109 E. Grand River (Front Machine) | $ 1,868.46 |680 |Q.D. 6099 South M.L.K. Blvd. (Logan) | $ 8,291.23 |
|642 |Oakland Center | $ 1,948.20 |681 |Q.D. 2233 S. Cedar | $ 7,783.73 |
|643 |MSU International Center-Left | $ 1,250.02 |682 |Q.D. 7120 Lansing Road | $ 4,316.93 |
|644 |MSU Union-Right (Post Office Side) | $ 1,249.59 |683 |Q.D. 500 E. Saginaw | $ 6,959.73 |
|645 |MSU Clinical Center | $ 317.69 |684 |Q.D. 808 E. Michigan | $ 2,919.78 |
|646 |MSU Breslin Center-1 Birch Road | $ 217.08 |685 |Q.D. 2600 S. Cedar | $ 7,778.91 |
|647 |MSU Brody Commons | $ 1,221.42 |686 |Q.D. 680 Lansing Road | $ 4,577.71 |
|648 |MSU Union-Left (Next to phones) | $ 1,510.20 |687 |Q.D. 118 N. Main Street | $ 8,106.97 |
|649 |MSU Kellogg Center | $ 452.02 |688 |Q.D. 6400 W. St. Joseph | $ 5,595.71 |
|650 |MSU McDonel Hall | $ 882.45 |689 |Q.D. 2400 E. Michigan | $ 4,906.25 |
|651 |MSU Owen Graduate Hall | $ 763.17 |690 |Q.D. 804 W. Willow | $ 6,150.20 |
|652 |MSU Holmes Hall West | $ 1,019.27 |691 |Q.D. 3332 Lake Lansing Road | $ 2,786.21 |
|653 |MSU Akers Hall West | $ 1,063.07 |692 |Q.D. 2625 E. Jolly Road | $ 7,355.78 |
|654 |MSU Hubbard Hall North | $ 1,077.54 |693 |Q.D. 1109 E. Grand River (Back Machine) | $ 2,913.24 |
|656 |523 E. Grand River (Lobby) | $ 196.37 |694 |Q.D. 1699 W. Grand River | $ 3,038.67 |
|657 |MSU Case Hall North | $ 816.36 |696 |Q.D. 10850 E. Second | $ 2,184.62 |
|658 |MSU Wonders Hall North | $ 1,011.34 |749 |600 East Crescent Road (Drives-East) | $ (233.13) |
|659 |MSU Holden Hall-East | $ 1,185.34 |753 |Oakland - Vandenberg Hall | $ 691.05 |
|660 |MSU Shaw Hall West | $ 0 |766 |MSU Library | $ 619.39 |
|661 |MSU Phillips Hall | $ 483.06 |767 |Oakland - 1899 N. Squirrel Rd. | $ 71.74 |
|662 |MSU Mason-Abbott Hall | $ 275.33 |768 |MSU Parking Ramp # 5 | $ 28.54 |
|663 |MSU Wilson Hall East | $ 876.50 |793 |Oakland - 4141 Continental Dr. | $ 473.02 |
|664 |MSU Administration Building | $ 52.82 |831 |Oakland - 1700 Atlantic Blvd. | $ 682.71 |
|665 |523 E. Grand River (Front) | $ 1,494.50 |832 |Oakland - 3800 Giddings Road | $ 889.70 |
|666 |Q.D. 400 S. Pennsylvania | $ 5,864.32 |867 |Not in service | |
|667 |Q.D. 2100 N. Larch | $ 6,320.15 |885 |523 E. Grand River (Back) | $ 2,015.79 |
|668 |Q.D. 1412 W. Mt. Hope | $ 6,300.03 |888 |Oakland University | $ 913.30 |
|669 |Q.D. 700 N. Pine | $ 3,414.78 |897 |MSU Brody Commons - Was #647 | $ 2.75 |
| | | | | | |
| | | | |Total Revenue |$ 193,949.59 |

Appendix D. ATM Revenue, Costs, and Profit

|ATM |Location - Status - Space |Revenue |Costs |Profit |Distance |
| | | | | |(miles) |
|45 |Q.D. 8512 W. Saginaw |$5,628.02 |$2,500.00 |$3,128.02 |11.5 |
|47 |600 East Crescent Road (Inside) |$31.46 |$1,200.00 |($1,168.54) | |
|630 |1925 W. Grand River (Inside) |($77.15) |$1,500.00 |($1,577.15) |3.1 |
|631 |1925 W. Grand River (Outside) |$264.37 |$1,500.00 |($1,235.63) |3.1 |
|632 |MSU International Center-Right |$1,631.71 |$1,500.00 |$131.71 |1.5 |
|633 |Oakland - Kresge Library |$133.39 |$1,500.00 |($1,366.61) |93.0 |
|634 |Oakland - 3625 East Pontiac |$1,139.07 |$1,500.00 |($360.93) |89.0 |
|635 |600 East Crescent Road (Drives-West) |($215.61) |$1,500.00 |($1,715.61) | |
|636 |Oakland - 3000 University Drive |$843.05 |$1,500.00 |($656.95) |89.2 |
|640 |MSU The College Store-4790 S. Hagadorn |$201.48 |$1,500.00 |($1,298.52) |1.8 |
|641 |Q.D. 1109 E. Grand River (Front Machine) |$1,868.46 |$1,500.00 |$368.46 |2.9 |
|642 |Oakland Center |$1,948.20 |$1,500.00 |$448.20 |89.0 |
|643 |MSU International Center-Left |$1,250.02 |$1,500.00 |($249.98) |1.5 |
|644 |MSU Union-Right (Post Office Side) |$1,249.59 |$1,500.00 |($250.41) |1.5 |
|645 |MSU Clinical Center |$317.69 |$1,500.00 |($1,182.31) |1.9 |
|646 |MSU Breslin Center-1 Birch Road |$217.08 |$1,500.00 |($1,282.93) |0.8 |
|647 |MSU Brody Commons |$1,221.42 |$1,500.00 |($278.58) |1.4 |
|648 |MSU Union-Left (Next to phones) |$1,510.20 |$1,500.00 |$10.20 |1.5 |
|649 |MSU Kellogg Center |$452.02 |$1,500.00 |($1,047.99) |1.1 |
|650 |MSU McDonel Hall |$882.45 |$1,500.00 |($617.56) |1.9 |
|651 |MSU Owen Graduate Hall |$763.17 |$1,500.00 |($736.83) |1.8 |
|652 |MSU Holmes Hall West |$1,019.27 |$1,500.00 |($480.73) |2.4 |
|653 |MSU Akers Hall West |$1,063.07 |$1,500.00 |($436.93) |1.9 |
|654 |MSU Hubbard Hall North |$1,077.54 |$1,500.00 |($422.46) |2.2 |
|656 |523 E. Grand River (Lobby) |$196.37 |$1,500.00 |($1,303.64) |2.1 |
|657 |MSU Case Hall North |$816.36 |$1,500.00 |($683.64) |1.0 |
|658 |MSU Wonders Hall North |$1,011.34 |$1,500.00 |($488.66) |0.8 |
|659 |MSU Holden Hall-East |$1,185.34 |$1,500.00 |($314.67) |0.7 |
|660 |MSU Shaw Hall West |$0.00 |$1,500.00 |($1,500.00) |1.9 |
|661 |MSU Phillips Hall |$483.06 |$1,500.00 |($1,016.94) |1.9 |
|662 |MSU Mason-Abbott Hall |$275.33 |$1,500.00 |($1,224.67) |1.9 |
|663 |MSU Wilson Hall East |$876.50 |$1,500.00 |($623.51) |0.8 |
|664 |MSU Administration Building |$52.82 |$1,500.00 |($1,447.18) |1.6 |
|665 |523 E. Grand River (Front) |$1,494.50 |$1,500.00 |($5.50) |2.1 |
|666 |Q.D. 400 S. Pennsylvania |$5,864.32 |$2,500.00 |$3,364.32 |2.9 |
|667 |Q.D. 2100 N. Larch |$6,320.15 |$2,500.00 |$3,820.15 |5.1 |
|668 |Q.D. 1412 W. Mt. Hope |$6,300.03 |$2,500.00 |$3,800.03 |4.2 |
|669 |Q.D. 700 N. Pine |$3,414.78 |$2,500.00 |$914.78 |5.5 |
|670 |Q.D. 720 W. Jolly |$5,843.39 |$2,500.00 |$3,343.39 |5.7 |
|671 |Q.D. 1200 W. Willow |$4,054.28 |$2,500.00 |$1,554.28 |5.8 |
|672 |Q.D. 645 S. Waverly |$6,036.69 |$2,500.00 |$3,536.69 |6.3 |
|673 |Q.D. 917 E. Cavanaugh |$5,057.35 |$2,500.00 |$2,557.35 |4.1 |
|674 |Q.D. 2121 W. Holmes |$6,285.17 |$2,500.00 |$3,785.17 |5.3 |
|675 |Q.D. 4500 W. Saginaw |$7,622.66 |$2,500.00 |$5,122.66 |7.8 |
|ATM |Location - Status - Space |Revenue |Costs |Profit |Distance |
| | | | | |(miles) |
|676 |Q.D. 947 Trowbridge |$1,263.03 |$2,500.00 |($1,236.97) |1.4 |
|677 |Q.D. 173 Maple |$4,199.43 |$2,500.00 |$1,699.43 |13.2 |
|678 |Q.D. 5100 S. Waverly |$6,088.55 |$2,500.00 |$3,588.55 |8.6 |
|679 |Q.D. 5930 Marsh Road |$3,265.21 |$2,500.00 |$765.21 |6.6 |
|680 |Q.D. 6099 South M.L.K. Blvd. (Logan) |$8,291.23 |$2,500.00 |$5,791.23 |9.9 |
|681 |Q.D. 2233 S. Cedar |$7,783.73 |$2,500.00 |$5,283.73 |6.3 |
|682 |Q.D. 7120 Lansing Road |$4,316.93 |$2,500.00 |$1,816.93 |10.5 |
|683 |Q.D. 500 E. Saginaw |$6,959.73 |$2,500.00 |$4,459.73 |4.4 |
|684 |Q.D. 808 E. Michigan |$2,919.78 |$2,500.00 |$419.78 |1.2 |
|685 |Q.D. 2600 S. Cedar |$7,778.91 |$2,500.00 |$5,278.91 |3.5 |
|686 |Q.D. 680 Lansing Road |$4,577.71 |$2,500.00 |$2,077.71 |23.6 |
|687 |Q.D. 118 N. Main Street |$8,106.97 |$2,500.00 |$5,606.97 |21.5 |
|688 |Q.D. 6400 W. St. Joseph |$5,595.71 |$2,500.00 |$3,095.71 |9.4 |
|689 |Q.D. 2400 E. Michigan |$4,906.25 |$2,500.00 |$2,406.25 |2.2 |
|690 |Q.D. 804 W. Willow |$6,150.20 |$2,500.00 |$3,650.20 |15.1 |
|691 |Q.D. 3332 Lake Lansing Road |$2,786.21 |$2,500.00 |$286.21 |4.0 |
|692 |Q.D. 2625 E. Jolly Road |$7,355.78 |$2,500.00 |$4,855.78 |3.2 |
|693 |Q.D. 1109 E. Grand River (Back Machine) |$2,913.24 |$2,500.00 |$413.24 |2.9 |
|694 |Q.D. 1699 W. Grand River |$3,038.67 |$2,500.00 |$538.67 |5.0 |
|696 |Q.D. 10850 E. Second |$2,184.62 |$2,500.00 |($315.38) |31.7 |
|749 |600 East Crescent Road (Drives-East) |($233.13) |$1,500.00 |($1,733.13) | |
|753 |Oakland - Vandenberg Hall |$691.05 |$1,500.00 |($808.96) |89.0 |
|766 |MSU Library |$619.39 |$1,500.00 |($880.61) |1.6 |
|767 |Oakland - 1899 N. Squirrel Rd. |$71.74 |$1,500.00 |($1,428.26) |89.4 |
|768 |MSU Parking Ramp # 5 |$28.54 |$1,500.00 |($1,471.46) |1.3 |
|793 |Oakland - 4141 Continental Dr. |$473.02 |$1,500.00 |($1,026.99) |89.8 |
|831 |Oakland - 1700 Atlantic Blvd. |$682.71 |$1,500.00 |($817.29) |89.8 |
|832 |Oakland - 3800 Giddings Road |$889.70 |$1,500.00 |($610.30) |91.8 |
|867 |Not in service | |$0.00 |$0.00 | |
|885 |523 E. Grand River (Back) |$2,015.79 |$1,500.00 |$515.79 |2.1 |
|888 |Oakland University |$913.30 |$1,500.00 |($586.71) |89.0 |
|897 |MSU Brody Commons - Was #647 |$2.75 |$1,500.00 |($1,497.25) |1.4 |
| | | | | | |
|1,000 |Total | $193,949.59 | $143,200.00 |$51,047.09 |1200.9 |

Appendix E. Summary of Surcharge Results

|Surcharge Amount |Decrease in Guest |Increase in Member |Revenue |Initial Profit |Profit with Surcharge |
| |Transactions |Transactions | | | |
|$0.01 |5% |2% | $ 181,482.13 | $ 38,282.13 | $ 42,420.39 |
|$0.01 |10% |3% | $ 169,410.39 | $ 26,210.39 | $ 30,130.85 |
|$0.01 |15% |4% | $ 157,338.65 | $ 14,138.65 | $ 17,841.30 |
|$0.50 |5% |2% | $ 181,482.13 | $ 38,282.13 | $ 245,194.98 |
|$0.50 |10% |3% | $ 169,410.39 | $ 26,210.39 | $ 222,233.09 |
|$0.50 |15% |4% | $ 157,338.65 | $ 14,138.65 | $ 199,271.20 |
|$1.00 |5% |2% | $ 181,482.13 | $ 38,282.13 | $ 452,107.83 |
|$1.00 |10% |3% | $ 169,410.39 | $ 26,210.39 | $ 418,255.79 |
|$1.00 |15% |4% | $ 157,338.65 | $ 14,138.65 | $ 384,403.75 |
|$1.50 |5% |2% | $ 181,482.13 | $ 38,282.13 | $ 659,020.68 |
|$1.50 |10% |3% | $ 169,410.39 | $ 26,210.39 | $ 614,278.49 |
|$1.50 |15% |4% | $ 157,338.65 | $ 14,138.65 | $ 569,536.30 |
|$2.00 |5% |2% | $ 181,482.13 | $ 38,282.13 | $ 865,933.53 |
|$2.00 |10% |3% | $ 169,410.39 | $ 26,210.39 | $ 810,301.19 |
|$2.00 |15% |4% | $ 157,338.65 | $ 14,138.65 | $ 754,668.85 |
|$2.50 |5% |2% | $ 181,482.13 | $ 38,282.13 | $1,072,846.38 |
|$2.50 |10% |3% | $ 169,410.39 | $ 26,210.39 | $1,006,323.89 |
|$2.50 |15% |4% | $ 157,338.65 | $ 14,138.65 | $ 939,801.40 |

Appendix F. Jersey Giant Locations and Distances from M.S.U.F.C.U

Jersey Giant Submarine Sandwiches Inc.
220 MAC Avenue, East Lansing, MI 48823
(517) 332-2969 1.9 MILES

Jersey Giant Submarine Sandwiches Inc.
529 East Grand River Avenue, East Lansing, MI 48823
(517) 332-2969 2.1 MILES

Jersey Giant Submarine Sandwiches Inc.
3019 East Saginaw Street, Lansing, MI 48912
(517) 351-1616 2.3 MILES

Jersey Giant Submarine Sandwiches Inc.
2546 East Jolly Rd, Lansing, MI 48910
(517) 394-3590 3.3 MILES

Jersey Giant Submarine Sandwiches Inc.
1866 West Grand River Avenue, Okemos, MI 48864
(517) 347-8400 4.6 MILES

Jersey Giant Submarine Sandwiches Inc.
3525 South Martin Luther King, Jr. Blvd. Ste. B, Lansing, MI 48910
(517) 882-2300 4.7 MILES

Jersey Giant Submarine Sandwiches Inc.
3700 West Saginaw Street, Lansing, MI 48917
(517) 323-6800 7.4 MILES

Jersey Giant Submarine 10
516 North Clinton Street, Grand Ledge, MI 48837
(517) 622-4855 16.0 MILES