Developing a Community Shop CREATON 17 MAY 2016
Agenda Intro Community Shops in UK Why Community engagement Governance Financials Property Considerations Grant and funding options Next steps
Your speaker Peter James Day job – regulator for accountants and lawyers Other job – treasurer – Titchmarsh Village Shop Trustee with the Plunkett Co-operative Community Network Co-founder Titchmarsh Village Shop 2007
Village Community Shops Around 400 in the UK Typically 153 members, 7 directors, 30 volunteers, 3.3 staff Typically £155k turnover 64% host post offices, 56% have cafes, 19% co-located Save 4 million mile car journeys per annum Have a 95% success rate (average small business 46%)
Why You need to be clear on what the drivers are; Retail therapy? Community? Less resourced in the community? Important in setting out the business case and seeking grant Role of village surveys 2012 Neighbourhood plan a good template – 80/90% v important Majority use post office and shop “regularly”
Community Engagement Shop Customers Shareholders Volunteers Fundraising Youngsters Street
Governance Management Committee Skills Project v Day-job Manager delegations Interaction with Parish Council Manager configuration Corporate structure – limited liability Community Benefit Society (most shops use this) Company Limited by Guarantee Community Interest Company
Financials – Operating Model Rule of thumb - £10 per household per week Creaton – 500 inhabitants – c220 Households? - £115k? Feedback from Shop was £175k year to March 2015 – perhaps additional custom from surrounding villages Gross margins are typically 22% (Titchmarsh 25%, Shop 21%) Margins affected by sales mix - eg cigarettes (v low) and cards (v high) Veg, dairy products and waste can have adverse impact – need careful management Overheads Principal ones are wages and power Amount of gross margin may determine what can be spent £175k x 21% suggests £35k to cover Triple bottom line – Profit – environment –sustainability
Financials – Issues Till and supporting software Chip & Pin Reverse credit arrangements Understandability for volunteers Purchase accounting and payments cycle VAT - Capital benefit – exempt supplies – marginal applications PAYE and Pension – but NI relief Statutory accounts – accountants report – Annual Return to FCA Bank account – Co-operative Bank supportive
Property – Issues Where and what (ideal 500 sq feet); Existing shop, portacabin, church, pub, village hall Build costs and supervision and timescales Beware VAT on multi-purpose and timing for refund What is being offered – shop, post office, café or combo? Highways and access and customer parking Loos & Disability access Security especially for Post Office Power configuration and air-conditioning
Grant & Funding Options Raising money by subscription to shares Allows varying investment but one vote per individual Encourages joint ownership by the wider community National Lottery Northamptonshire County Council Plunkett, Acre and other rural support organisations Co-op Co-operative & Community Finance - low interest loans
Next steps (Plunkett) 1.Contact Plunkett (Frontline manager) or SME 2.Form a working group 3.Consult with the community 4.Hold a public meeting 5.Elect a committee – at the public meeting? 6.Select legal structure 7.Identify suitable premises 8.Work up a business plan 9.Raise required finance 10.Plan layout, stock and pricing 11.Join Plunkett 12.Ensure correct alcohol licensing 13.Ensure compliance with regulations 14.Publicise launch date
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