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Bledington Community Shop & Café Detailed Business Plan

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Bledington Community Shop & Café Detailed Business Plan BCSL: Detailed Business Plan BLEDINGTON COMMUNITY SHOP & CAFÉ DETAILED BUSINESS PLAN “The protection of existing post offices, village shops, public houses and other retail facilities is vital to the future sustainability of many small settlements. These facilities are an essential element of the local economy and, especially in the more remote rural areas, of great importance socially” Source: Cotswold District Local Plan 2001 – 2011, Section 3.5.12 Produced by Bledington Community Shop Ltd August 2012 Contact: Michael Lear (Chairman, Bledington Community Shop Ltd) Trinders Bledington OX7 6UG Tel: 01608 659371 Email: [email protected] 1 BCSL: Detailed Business Plan BLEDINGTON COMMUNITY SHOP LTD (BCSL): BUSINESS PLAN 1. Executive Summary Page 3 2. BCSL: Positives and Negatives Page 5 3. Current Situation Page 6 4. BCSL: The Proposed Offering Page 7 5. BCSL’s Potential Market Page 10 6. BCSL’s Proposed Location Page 11 7. Is This Project Viable? Page 12 8. BCSL’s Legal Structure Page 14 9. Financial Forecasts Page 14 10. Funding Requirements Page 18 11. Timetable Page 18 12. Opposition to the Project Page 19 APPENDICES A. BCSL’s Projected Start Up Capital Costs Page 21 B. Detailed 5 Year Financial Model Page 22 C. Sources Of Comparable Statistics Page 24 D. 2010 Village Shop Survey Results Page 25 E. Comments from the 2010 Survey Page 26 F. BCSL’s Officers Page 32 G. History of BCSL Page 34 2 BCSL: Detailed Business Plan 1. EXECUTIVE SUMMARY Bledington has been without a village shop since 2006, when its privately-owed shop and post office closed. As a result, the community lacks an effective social centre, accessible to all ages throughout the day. A new, well located shop and café should answer this need, and, critically, help to ensure that Bledington remains a thriving and vibrant community in the years to come. The Proposal Bledington Community Shop Ltd (BCSL) (formerly Bledington Shop Group (BSG)) proposes to open Bledington Shop and Café as a Community Enterprise in Autumn 2013. BCSL has recently acquired an option from the land owner to develop a new, purpose built premises on a small section of Middle Orchard in the centre of the village. Within easy walking distance for the majority of the population, the shop will provide residents with a wide range of services and high quality, locally sourced produce at reasonable prices. The shop may also offer some form of postal services: BCSL is currently in discussions with the Post Office. Total project costs (including an allowance for working capital) are forecast at £205,000. (see: BCSL: The Proposed Offering Pg 7ff) Most of the parish supports the project, as do local businesses In the 2010 parish survey (the third survey conducted since 2006), 151 households (49% of the 270 households in the community) thought a shop was ‘important’ or ‘very important’. This compared with 104 (42%) in the previous 2008 survey. 181 (67%) expected to use the proposed shop at least weekly, compared with 44% in the 2008 survey. Bledington Parish Council, the Governors of Bledington Primary School, Bledington Housing Association and local employers, including the King’s Head Inn, have also stated their support for the project . (see: Current Situation Pg 6) 31% of the community are already members of BCSL Since February 2012, 147 people (31% of the adult members of the community) have joined the BCSL, despite the fact that the project is still in its infancy. To date, almost 20% of households in the community have committed to a regular payment scheme at the shop, guaranteeing annual revenue of £40,360, representing 25% of the shop’s forecast retail sales in Year 1. (see: BCSL’s Legal Structure Pg14 + Financial Forecasts Pg 14ff). BCSL considers Middle Orchard to be the only feasible site Everyone in the village recognises and appreciates the value of Middle Orchard as a green space. Unfortunately, there are very few locations available in the village that make sound economic sense for a successful shop. After spending 6 years considering all possible sites, BCSL concluded that the proposed Middle Orchard site is ideal, and, indeed, is the only feasible site for a viable shop and cafe. Lying in the heart of the village, the site is within easy walking distance for the majority of the population, and has sufficient space to accommodate parking and deliveries with the minimum of disruption for local residents. Moreover, it is adjacent to the busy B4450 (linking Stow on the Wold, Kingham Railway Station and Chipping Norton). It is close to Bledington Primary School and beside the Oxfordshire Way, a well-established long distance walking route. It should, therefore, attract useful additional revenue from outside the village community. (see BCSL’s Proposed Location Pg 11ff). In the 2010 survey, 56% supported the Middle Orchard site In the 2010 village shop survey, 120 households (44% of total households, and representing 56% of those who responded to the survey) supported the proposal to build a shop on the Middle Orchard site, whilst 57 (21%) were neutral. Only 38 (14%) ‘disagreed’ or ‘strongly disagreed’ with the proposed site. (see BCSL’s Proposed Location Pg 11ff). 3 BCSL: Detailed Business Plan 35 villagers have already volunteered to work in the shop and cafe Based on the experience of the best performing community shops, BCSL will employ a paid professional to manage the shop, supported by some 20+ reliable volunteers. Some 35 people of all ages have already volunteered to work in the shop, with more expressing interest to volunteer once planning permission has been granted. In future, BCSL expects the success of the shop to result in the creation of additional employment, in the form of retail apprenticeships for local school leavers, or paid part time work. (see Financial Forecasts: staff costs Pg 16). An experienced fund raising committee has been established Since detailed proposals were discussed in a public meeting in February, 116 households have already committed £14,000 (7% of total costs) towards the project’s £205,000 costs, with additional pledges made for further sums. Whilst BCSL will continue active fund raising within the community, it expects to raise the majority of funding externally. This is line with the recent experience of other community shops. An external fund raising committee has been established, comprised of individuals with significant experience of fund raising at national and local levels . (see Funding Requirements Pg 18). Bledington Shop + Café: Summary Financial Forecasts (£) Year 1 Year 2 Year 3 Year 4 Year 5 Turnover 170,100 187,110 199,958 209,956 220,454 Cost of Goods Sold 129,729 142,702 151,823 158,210 165,061 Gross Profit 40,371 44,408 48,135 51,746 55,393 Gross Profit Margin (%) 23.7 23.7 24.1 24.6 25.1 Overheads 41,168 43,276 47,104 49,296 51,598 Overheads as a % of sales 24.2 23.1 23.5 23.5 23.5 Surplus/(deficit) (797) 1,131 1,031 2,450 3,795 Source: BCSL BCSL has used the trading performance of the previous Bledington shop as a starting point for its financial forecasts. As these figures are very out of date, BCSL has relied more on recent comparative figures from existing community shops in the Cotswolds, as well as recent data from other community shops and industry experts. BCSL’s forecast retail sales of £158,760 in 2013-14 (equivalent to average weekly retail sales of £3,053) is likely to prove conservative. Last year, the seven shops advising BCSL – all in communities of a similar size – reported turnover between 3% – 59% higher than BCSL’s 2013- 14 forecast sales. Most of these shops do not benefit from the through traffic that Bledington Shop is likely to benefit from . (see Financial Forecasts Pg 14ff + Detailed 5 Year Financial Model Pg 22ff). Evidence from existing shops supports the business case According to BCSL’s conservative forecasts, Bledington Shop is expected to start generating surpluses in its second year of operation. This is in line with the performance of other community shops. Over time, these surpluses should be sufficient to fund future growth and also to provide valuable donations to community projects, so relieving some of the burden of fund raising from individuals within the village. (see Financial Forecasts Pg 14ff + Appendix B Comparative Statistics From Other Community Shops Pg 25) 4 BCSL: Detailed Business Plan . 2. BCSL: POSTIVES AND NEGATIVES In the following pages, BCSL discusses the detailed case behind its proposal for a community shop. BCSL believes the positive factors far outweigh possible negatives. Likely benefits are listed in detail on page 8, but include the following: Positives • A shop will enhance the viability of the village, and help meet the needs of the local community – eg strong community support from the village ( see Pg 6 ) + likely support from people living outside the community ( see Pg 10 ) • A shop will reduce the need for local people to travel to purchase supplies – eg current shopping facilities ( see Pg 6ff ) + the proposed offering ( see Pg 7ff ). • A shop with café facilities will help social inclusion and improve the community’s sustainability – eg the creation of an attractive social hub for Bledington’s diverse community (see Pg 9 ) + the use of volunteers and staff from within the community ( see staff costs Pg 16) • Located in the centre of the village within easy walking distance for the majority of the community, the shop will be easily accessible for customers and suppliers (see Pg 11ff) • The financial case for community-run shops is strong – eg community-run shops often succeed where privately-owned ones fail ( see Pg 12 ); other community shops in the area generate surpluses; BCSL’s conservative financial model suggests that the shop will generate surpluses from its second year of trading ( see Pg 14ff and Pg 22ff ) • Community involvement should ensure continuing, long term support and customers for the shop – eg 31% of the adults in the community have already joined BCSL ( see page 14 ); almost 20% of total households have signed up for the shop’s ‘regular payment scheme’ ( see page 15) • BCSL’s legal structure enables it to donate future excess surpluses to the community to fund local projects (see legal structure: page 14) .
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