Village shop

[Hels]

I was looking for a little advice!

The village shop has come up for rent, it is £5800 a year, there is a small kitchette and It has a lot of passing traffic (lorry drivers etc)

Im sure I could make a good go of it, and have started to have a think, but not a clue where to start to be honest. I dont have a clue how to work out how much profit there is to be made or how much I would need to set up etc.

I have the idea I could possibly do a small side of sandwiches and hot drinks and cakes for passing trade, newspapers (another thing I know nothing about!) and then your bog standard village shop essentials.

Can anyone point me in the right direction? many thanks in advance!

 

[retailworld]

Hi,

For a start you'll have to check to see what usage the shop is registered for, which may limit what things you can do (i.e A1 / A3).

For papers, you'll need to set up an account for your local distributor (Smiths News or Menzies).

There's quite a lot involved though - have you got any previous experience? Where are you based?

 

[Hels]

Thanks for taking the time to reply.
We are based in a commuter village in East Yorkshire, on the Yorkshire Wolds near Driffield.

I dont have any business experience, I have worked in retail quite a few years ago, and my husband has a little experience too. He is currently self employed but spends so much time away from home, he would like to have a change and I am a part time nurse and would like to keep my job as it is regular income and also need to keep my registration.

I think I may go to Business link today for some information and have to call in to the bank, so will see if there would be any finances they could help with (long shot I guess??)

Thanks again

 

[retailworld]

I think the bank would want to see some sort of business plan rather than you just turning up & asking for some cash

You need to know if it is going to be a viable business or not. If you send me a PM I can go over some figures with you if you'd rather not post them on an open forum.

 

[Hels]

haha, yes the intention wasnt to turn up today with my hand out!! I thought I would just ask if they did anything to help starting up new businesess, although I gather this is unlikely?

Thanks again for replying, Id find it hard to look at a business plan at the minute as i dont have a clue about profit, net and gross and what our outgoings/incomes are even likely to be??

Ill Pm you.

 

[JohnLocke1]

I call in to the bank, so will see if there would be any finances they could help with (long shot I guess??)

Thanks again

You'll need a lot more info and business plans etc before a bank will sit down to discuss anything so that will be jumping the gun a bit.

Get all the details and accounts from the vendor if it's the business your buying. If your just taking over the lease you need to ideally speak to the current owners to get an idea of sales/cost/margins etc (this may not be forthcoming though), or do some research. This can be as simple as sitting outside the shop for a few days, ideally a week, and counting footfall, seeing how much customers are actually buying and talking to the customers.

Then you need to source your suppliers, get a figure for services etc

When you have this you should be able to produce a business plan and cash flow forecast. It's at this point a meeting with your business bank manager can be arranged.

Anyway good luck and I wish you well.

John

 

[JohnLocke1]

Thanks again for replying, Id find it hard to look at a business plan at the minute as i dont have a clue about profit, net and gross and what our outgoings/incomes are even likely to be??

Ill Pm you.

And that's what a business plan and cashflow chart will show you.

 

[Hels]

Thank you.

The shop is now closed, the previous owner had it 2 years, so it is the property Id be renting not taking over the business. The previous owner never really had any stock in when even when she first opened. I guess I could track her down and ask her more questions?

Im very naive I guess :redface: I thought it would just be a case of going to a cash and carry and buy a start up of stock, I hadnt really thought of suppliers!

 

[JohnLocke1]

Thank you.

The shop is now closed, the previous owner had it 2 years, so it is the property Id be renting not taking over the business. The previous owner never really had any stock in when even when she first opened. I guess I could track her down and ask her more questions?

Im very naive I guess :redface: I thought it would just be a case of going to a cash and carry and buy a start up of stock, I hadnt really thought of suppliers!

If it's a general stores/corner shop type place then yes it will be a cash and carry for 90% of your stock.

To get you started you have very approx' the following to consider:-

Basic annual costs
Rent £5,800 pa
Rates £1,500 pa (check here)
Services £3,000 - £6,000 plus pa (depending on shop size, number of chillers, air con etc)
Profit Margin average 22% for "branded goods", 35% - 50% for "Happy Shopper" or similar.

Start up costs
Legal £1,500
Lease deposit £2,000
Three months advance rental £2,000
Shop fitting ???? anything from £1,000 to £10,000
Chillers - can be free
Misc (tills, stationery, scales etc etc) £1,500 plus

This is just a starting point for you but should get you started on a business plan and cash flow at least. You'll probably want to add things like advertising and promotions, especially to start with.

 

[Hels]

Wow, Thanks you!

Im going to see the shop next week, I have looked throught the windows and it looks ok.

The shop is registered as A1, although I wasnt wanting a cafe particularly, just to do some take away butties, homemade cakes and drinks, Im not sure if this is viable with A1 registration?

The letting agency said the fittings were included, although they arent visable in the shop anymore. The lease is for 3 years, although I asked if this could be negotiated and she said yes.

 

[JohnLocke1]

Wow, Thanks you!

Im going to see the shop next week, I have looked throught the windows and it looks ok.

The shop is registered as A1, although I wasnt wanting a cafe particularly, just to do some take away butties, homemade cakes and drinks, Im not sure if this is viable with A1 registration?

The letting agency said the fittings were included, although they arent visable in the shop anymore. The lease is for 3 years, although I asked if this could be negotiated and she said yes.

A1 you can't sell hot drinks. You can sell sarnies' etc if you pre-pack them and stick them in a chiller.

The lease will be all negotiable. Get a good commercial solicitor and make sure you get a few months rent free to start and frequent breaks in the lease. There are 101 other things to be aware of, you solicitor will guide you through these.

Check the condition of any units that are included, they may be of no use to you in which case ask for them to be removed before you take on the lease. Otherwise it'll cost you time and money to remove them yourself. Not a biggie, but a real pain.

 

[Hels]

Ahhh so I wouldnt be able to sell my gorgeous crispy hot bacon rolls?? Booo!

Thanks again for your help!

Also, would you expect newspapers in a village shop......I know the answer I guess, but from researching I see you make very little and you have to be up at 4am or something daft to recieve them and sort them etc?

 

[JohnLocke1]

Basic annual costs
Rent £5,800 pa
Rates £1,500 pa (check here)
Services £3,000 - £6,000 plus pa (depending on shop size, number of chillers, air con etc)
Profit Margin average 22% for "branded goods", 35% - 50% for "Happy Shopper" or similar.

Start up costs
Legal £1,500
Lease deposit £2,000 £1,500
Three months advance rental £2,000 £1,500
Shop fitting ???? anything from £1,000 to £10,000
Chillers - can be free
Misc (tills, stationery, scales etc etc) £1,500 plus

I'm sure you noticed my error :redface:

 

[JohnLocke1]

Ahhh so I wouldnt be able to sell my gorgeous crispy hot bacon rolls?? Booo!

Thanks again for your help!

Also, would you expect newspapers in a village shop......I know the answer I guess, but from researching I see you make very little and you have to be up at 4am or something daft to recieve them and sort them etc?

Change of use is only a planning issue, speak to your council and find out what the chances are of it being approved.

Newspapers - you know the village.

 

[Hels]

Thanks,
Yes the council said it was to be A3 if i sold hot food to take away, it only cost 350 to apply....way less than I thought!

 

[chiggs]

Is there an area nearby where cars/lorries can park up so the drivers can visit your shop/sarnie bar? Just thinking there's no good having passing traffic if they can't pull over and purchase!

 

[Hels]

No, there isnt really, they always tend to park on the road or in a small layby. But they are always stopping.

 

[Holly23]

I am considering taking a lease assignment on a village shop, convenience store. I am in real need of some help as this will be my first business and potenially my family's future at stake. It is in a beautiful location, rent is low, however it is a listed building and as far as I can get from the agent, I would be required to repair the inside of the property (and the private accomodation). My main concerns are that there is also a general village store 200ft away from this premises, which is bigger and has an alcohol licence. The 2nd is the the average turnover, according the current leasee is £200p.w. however when I requested financial information from the agent all I recieved was the previous year tax return, where the turnover was only £62,000 and the agent still maintains that it takes £2000 p.w but cannot provided any further records.

Sorry Ive gone on a bit but any help would be much appreciated!!!

 

[ecommerce84]

Also, would you expect newspapers in a village shop......I know the answer I guess, but from researching I see you make very little and you have to be up at 4am or something daft to recieve them and sort them etc?

I know someone who ran a small shop and wanted to try papers. So he bought some from a supermarket on the way to his shop and re sold them to see what, if any would sell.

He found that he could sell (from memory) The Mail, The Telegraph and The Local Paper, so he stopped picking up others (The Guardian, The Sun, the Mirror) and got a few more copies of the others. His intention was to get papers delivered, but he seemed to think that the hassle of getting up early to make a couple of quid wasn't worth it so he carried on getting them from the supermarket.

This was in a small village with an older population, many of whom would wander down in the morning and grab a paper, but might also pick up a loaf of bread, milk, some eggs, so he would make some money there. He saw it as offering a service to the village.

I haven't seen him for 18 months or so but I assume he still does this. I also have no idea if this is 'allowed' but he didn't seem to worry. I doubt the Newspapers themselevs care, but local distributors might.

It might be something worth thinking about just to 'test the waters' and see if it is actually worth doing.

 

[Hels]

And its still something Id love to try!

 

[mhall]

How far have you got with your Business Plan and research in the last 8 months?

 

[evocart]

When I worked in a small shop when I was younger we used to get our newspapers from another shop who supplied us on sale or return, they did newspaper deliveries (though we went to them to collect) so they could order the extra for us no problem. there was absolutely no profit at all doing this, but that doesnt matter as when people come in to buy a paper off you they will probably also buy bread, milk and smokes so that is where you make your profit.

Also if you can and do go ahead then consider doing door to door deliveries if there are a lot of small villages without stores in your local area as that will also help boost proits.

We also have a general store near us and they have a very small heated cabinet on thier counter where they sell host sandwiches and snacks.

Good luck with your new venture should you go ahead, I must admit that I love these kind of shops but you must keep it fully stocked and offer as much choice as possible with offers to stop them getting in the car and driving to the nearest large supermarket for every little thing.

PS also as well as food dont forget to stock other items for emergencies, ie plugs, screw drivers, nails etc and in the summer bedding plants and possibly fresh flowers.