Broadwindsor Community Stores needs to secure its future.

The Committee have submitted a loan application to the Broadwindsor Group Parish Council for the purchase of the freehold of the shop premises, to be considered at their meeting on Monday 13 June 2022.

Please see details below from our Secretary.

BROADWINDSOR and DISTRICT COMMUNITY ENTERPRISE LTD (‘BADCE’)

APPLICATION TO BGPC FOR A LOAN FOR THE PURCHASE OF THE FREEHOLD OF THE SHOP PREMISES

1. BADCE is registered under the Co - Operative and Community Benefits Societies Act 2014, number 31629R. Annual Returns, available on line, are filed with the Financial Conduct Authority. BADCE carries on business as a convenience store for the benefit of Broadwindsor village and the nearby district. BADCE has 330 members, on a one vote per member basis. The shop is an invaluable resource to the district, as has particularly been shown in the recent pandemic, and is widely supported by its members, volunteer assistants and the general public, and also by the local Council.

2. BADCE was established in early 2013 after public fundraising of some £30,000. From its inception it has reported an annual financial surplus, modest by reference to turnover, but grocery is a low margin trade, and the shop is not in business to maximise profits. At 31 December 2021, its accounts show total members’ funds of £64,016, represented by some £45,000 in cash and bank deposits, with the balance invested in the shop business.

3. BADCE occupies its premises at The Old Telephone Exchange (’TOTE’) in Drimpton Road, Broadwindsor under a lease agreement at a current annual rent of £4,000 per year, for a term expiring on 31 December 2022, with no security of tenure after that date. Relations with the landlord are good, but the risk is that circumstances may change, and a lease renewal might not be offered in 2023, or at a later date. In any event the annual rent is likely to rise with inflation. The current location suits the shop very well, and there is presently no other comparable site for the shop in the village. Leased tenure restricts the shop from making any improvements to the building, or on the shop site, and this limits the future development of the shop.

4. Following negotiations with the landlord a price has been agreed for the freehold at £75,000 plus vendor legal fees. The value of the TOTE building is in the region of £75,000/100,000 based on other transactions in identical buildings round the country; recently such a building was offered for sale in Yetminster, let at just over £4k per year, for £99.5k. The landlord values the building at some £100,000, but is generously willing to sell it to BADCE at the discounted price of £75k. A professional opinion has been taken supporting this purchase price.

5. The BADCE Committee recommends the purchase of the freehold, as a one off opportunity to provide long term security for the shop, at a very reasonable price for a freehold. In order to fund the purchase, grant opportunities have been sought over the last six months, but without success. The main problem is that most current grant programmes are for new projects, which cannot readily access funding in any conventional way, and BADCE does not meet these criteria. Also, the Committee does not think it an opportune time to raise further funds from the members: there are considerable funds in the bank, partly from the original members’ fund raising, and also the local community has only recently raised money for the local pub.

6. BADCE is therefore looking at loan finance. The total cost of the freehold, with fees and costs, might be some £80,000. BADCE currently has some £45k of cash, but needs to retain a trading buffer of some £15k, making say £30k available for the purchase, and so is looking for loan finance of some £50k, and has approached BGPC for assistance.

7. BGPC may be able to access loan finance through the Public Works Loan Board, where currently published repayment terms for a £50k loan show capital and interest repayments on say a 30 year term of a fixed amount of under £3,000 per year, which is less than the current £4,000 annual rent paid by the shop, which is not fixed for the future. So the shop could readily afford this loan repayment cost.

8. In respect of a loan, BADCE would grant BGPC security over the TOTE freehold property, which has a value materially higher than a £50k loan, so BGPC would have good capital security for its loan. BGPC would also have income security as the shop can readily afford the projected loan repayment costs out of its current trading results. BADCE would also offer to pay any incidental costs to BGPC of the loan assistance.

S W Urry
Secretary – BADCE
May 2022

All you need is love

We’ve got a lovely display for Valentine’s day this year thanks to Margaret.

If you’re after a card or a little treat, head to your community shop…

We’re hiring !

Our shop Manager Kevin is moving on after five years of great service.
We’re therefore looking for a new Manager.

Do you know anyone who may be interested?

The successful applicant will be responsible for the day-to-day management of the store, managing and working alongside two part-time assistants and a team of volunteers. 

You will be computer literate and possess excellent inter-personal skills. You will be expected to demonstrate initiative, imagination and leadership to implement strategies to increase customer spend and shop profitability. 

Relevant retail experience would be beneficial as would a liquor licence.  As manager you will work a 32 hour week, with early starts, weekend and Bank Holiday work involved. If appointed, you will be expected to attend Committee Management meetings outside these hours. A full job description, including remuneration, can be obtained by e-mailing andrewhookings@yahoo.co.uk or telephoning 01308 867638 Closing date for applications: Wednesday 9th February 2022