Rural Stores/Post Office

[MarkG1303]

Good Morning All!

New Here! Just wanted thoughts on a Stores financials, I may have answered my own question but purchase price seems to be pretty high (I think I read about unscrupulous agents increasing values etc), or it may be completely feasible (the view of my friend who ran a successful rural post office himself).

So prominent position in a small village (other villages surrounding) no other shops within a good few miles. Stores and Post Office with large detached home (been in situ from early 1900's. It definitely needs bringing up to date decoratively and stock wise..

10yr lease - 169k
(annual rent 8k)

turnover - 159k
G Profit - 44k

 

[Mark T Jones]

Nowhere near enough information to make any kind of assessment.

What you need is:

- 5 year spread of detailed information.
- Bang upto date management information, broken down.
- 6 months bank statements.
- Copy of the lease to establish what liability you are taking on.

If it isn't apparent in the above you want to work out what the current owners are actually learning.

Quick answer - human nature says they are almost certainly over-valuing. Why are they leaving?

 

[MarkG1303]

Nowhere near enough information to make any kind of assessment.

What you need is:

- 5 year spread of detailed information.
- Bang upto date management information, broken down.
- 6 months bank statements.
- Copy of the lease to establish what liability you are taking on.

If it isn't apparent in the above you want to work out what the current owners are actually learning.

Quick answer - human nature says they are almost certainly over-valuing. Why are they leaving?

Thanks Mark, looking in to those as we speak, its an ill health sale (seems to have been family run for a substantial number of years) I know its an FRI lease

 

[Socio South West]

This looks like a broker valuation... They can ask what they like... You can offer what you like. If its ill health, then you can be firmer with what you offer,

The big thing with any rural store/post office is to remember that shopping is more comprehensive and cheaper a handful of driving miles away and this defines your clientele.

Living in rural communities all my life I have seen shop owners come and go.... some were just never cut out for it.... some couldn't resist the off licence stock.... hope you have the combination of enterprise and community spirit that is needed to make a go of it. Best of luck

 

[MarkG1303]

This looks like a broker valuation... They can ask what they like... You can offer what you like. If its ill health, then you can be firmer with what you offer,

The big thing with any rural store/post office is to remember that shopping is more comprehensive and cheaper a handful of driving miles away and this defines your clientele.

Living in rural communities all my life I have seen shop owners come and go.... some were just never cut out for it.... some couldn't resist the off licence stock.... hope you have the combination of enterprise and community spirit that is needed to make a go of it. Best of luck

Thank you, useful and pertinent valid words, its been my thought that rurally people choose to buy from the person not the store which makes your point even more valid!

 

[fisicx]

The post office where my parents live closed down because it couldn’t survive on selling the odd book of stamps. Everyone in the village now does things online. Which is why the local shop is hanging on for dear life.

Even in more populous areas corner shops struggle.

 

[Mark T Jones]

Thank you, useful and pertinent valid words, its been my thought that rurally people choose to buy from the person not the store which makes your point even more valid!

Research trumps assumption every time.

Even as the only local shop, people need a reason to use you rather than shopping online or driving into town. Reasons might revolve around stock, experience or genuinely community reasons.

 

[Socio South West]

The post office where my parents live closed down because it couldn’t survive on selling the odd book of stamps. Everyone in the village now does things online. Which is why the local shop is hanging on for dear life.

Even in more populous areas corner shops struggle.

That's the very poor and blinkered misconception that everybody is internet savvy and does everything online and there is no other way. There is still an element of the population... probably in their seventies or more.... who are resistant to doing things online - hence my broad definition of the likely clientele. They are also less likely to be drivers, and still rely on a small local shop for supplies.

Expanding the business is where @MarkG1303 and the like need to think outside the box - I know of several village shops that have set themselves up as coffee shops and become 'go to' stop offs for walkers and cyclists: A link with an artisan bakery and other artisan outlets has also proven to be successful. Many are now parcel collection and delivery points. Anything to be more than a Post Office and Village store.

It's far from easy in the rural communities, and it takes a very different blend from that of mainstream business owners to make a go of it.

 

[BusterBloodvessel]

That's the very poor and blinkered misconception that everybody is internet savvy and does everything online and there is no other way. There is still an element of the population... probably in their seventies or more.... who are resistant to doing things online - hence my broad definition of the likely clientele. They are also less likely to be drivers, and still rely on a small local shop for supplies.

Expanding the business is where @MarkG1303 and the like need to think outside the box - I know of several village shops that have set themselves up as coffee shops and become 'go to' stop offs for walkers and cyclists: A link with an artisan bakery and other artisan outlets has also proven to be successful. Many are now parcel collection and delivery points. Anything to be more than a Post Office and Village store.

Absolutely. There is a village post office nearby that we used to supply - the village has a population of around 2,500 people but it's only perhaps 3 miles and 7 or 8 minutes drive from being back into a much bigger area (part of the main town) and from a Sainsburys Local, Co-Op, takeaway etc. My point being it's not exactly isolated and people aren't really forced to use it when a small supermarket is nearby.

However, it is thriving. They turned the sideroom into a cafe, as said above it's a stop off point for cyclists etc, they sell decent coffee, home made cakes, food from local artisan suppliers, a good selection of alcohol, every tin and bit of ingredient you can think of for when people realise they've just run out of that one oxo cube they need to make dinner etc. Parcel collections, lottery, and so on. The Post Office is just a small element of it.

The owners did let slip to me what they take from the business between them and it is well, well, WELL into the 6 figure bracket.

 

[GFI]

There is a village post office that I drive past if heading to see customers in that direction.

When passing I will ALWAYS stop there for a bacon butty - because it is an amazing butty!

The shop is tiny, and seems to have far too much space dedicated to greeting cards and dusty jars of piccalilli and chutney. These jars are £3.90 a pop and literally dusty! The cards and these jars use up roughly 30% of the available space.

The water and pop fridge runs at just about cool - like 9-10 degrees.

So I will buy my butty, but not a can of coke. And yes I have given them feedback on the fridge.

3 months ago they closed the post office side of the business. A sign went up 6 months ago giving notice and the reason why. They had an armed robbery and the lone member of staff was beaten, so totally understandable.

They decided that the draw of "cash of quantity" on the premises was too much.

I was in the other day for my butty and the owner was in the shop - I had a chat with him about if the closing of the post office had impacted the shop performance. Yes it had, down roughly 30%.

I asked if he was planning to change anything to drive things up - his response was "yeah close up for good"

When that happens I will miss them bacon butties!

Small retail is really really hard, a ton of work for little to no reward - unless you get something bang on right and bocome a destination!