From Tat to Vino!

[Paddy]

Rates are on the rental value of the property, not the actual rent. Rental values are calculated on the average of the current rents on new leases. This is done my members of RICs and sometimes by the County Court.

This couple have had an independent off licence for over twenty years. They sell cheap and are very popular. It may be worth poping down to have a chat with them. Down The Hatch. 01202 301002. 319 Holdenhurst Road, Bournemouth, BH8 8BT

bournemouth - Google Maps

[HairyArsedBloke]

I cannot see this being viable.

I think you need to separate the property aspects from the retail ones. It will make things easier with Hector and if you wanted to sell the business.

Property

Freehold 210,000

Financing costs. 0.48% above bank rate - where the frack are you getting those funds from?!!!!!! In the real world 2.5% above bank is more like it. As regards bank rate itself (I have to be careful here), it would be foolish to base long-term finance plans on the current rate of 0.5%. Model on, say, 5% but also look at 10% too.

Given your statement that the property rents for 18,000 I would say that the price may be a tad high.


Retail

Turnover 24,000 GP 28% i.e. GP 67200

Costs

Staff: Hours: 72.5 + 60 = 130.5 even at NMW your staff costs are going to be about 45,000 pa.
Rent: 18,000 (accounting delusions should not be used as it distorts things)
Rates: 3,600
Ins: 1000
Bills: 3000

Total 70,600


Now children - can anyone see what is wrong here?

[MarillionFan]

I cannot see this being viable.

I think you need to separate the property aspects from the retail ones. It will make things easier with Hector and if you wanted to sell the business.

Property

Freehold 210,000

Financing costs. 0.48% above bank rate - where the frack are you getting those funds from?!!!!!! In the real world 2.5% above bank is more like it. As regards bank rate itself (I have to be careful here), it would be foolish to base long-term finance plans on the current rate of 0.5%. Model on, say, 5% but also look at 10% too.

Given your statement that the property rents for 18,000 I would say that the price may be a tad high.


Retail

Turnover 24,000 GP 28% i.e. GP 67200

Costs

Staff: Hours: 72.5 + 60 = 130.5 even at NMW your staff costs are going to be about 45,000 pa.
Rent: 18,000 (accounting delusions should not be used as it distorts things)
Rates: 3,600
Ins: 1000
Bills: 3000

Total 70,600


Now children - can anyone see what is wrong here?

Are you in or out then?

[HairyArsedBloke]

Are you in or out then?

Nah, I'm safer writing call options on SKA.

[Sysman]

Some interesting stuff on Daltons.Only a few 'bargain booze' businesses up for a sale, massive turnover from small locations. £900k, £100m, £495k all of places with rent similar and less than £30

That was what was wrong with your earlier example quoting a turnover of 240K p.a. and 70 odd hours a week.

The local sweet shop-cum-off licence my neighbour looked at in the 1980s had a turnover of 130K and it was only open part time. It did:

• sandwiches and cigs for the factory across the road
• sweets and fizzy drinks for kids attending the school 50 yards away
• only a limited amount of booze - no parking (on a bad bend) and closed early
• it was on a steep hill so only very local folks would walk to it

[norrahe]

Have you considered doing any of the WSET qualifications?

Have you also thought of applying for a stage in a restaurant with a sommelier?

Do you have any links with importers, might be a stupid question do you buy trade magazines and publications such as decanter to keep up with wine trends?

Will you also be attending trade fairs and tastings.

Have you also made an effort to visit some of the vineyards?

No offence but if someone is going to sell me wine then they need to know a hell of a lot about it, including the individual characteristics of the wine they sell what foods it might match (a common question you can often be met with). Giving someone sales spiel (i.e. tasting notes as laid down by the company that sold you your vino) aint gonna cut it.

It's good to know that your retailer has a keen passion for wine, and knows it inside out, if they are uninspired by the goods they retail then what's the point?

[AtW]

Nah, I'm safer writing call options on SKA.

[MarillionFan]

No offence but if someone is going to sell me wine then they need to know a hell of a lot about it, including the individual characteristics of the wine they sell what foods it might match (a common question you can often be met with). Giving someone sales spiel (i.e. tasting notes as laid down by the company that sold you your vino) aint gonna cut it.

point?

Thanks for the suggestions. Obviously a better appreciation of wine would be required but not convinced the average off license owner needs to serve 2 years working in a Michelin restaurant.

To be fair i'm actually deciding whether the existing business is viable to sustain their lease and would it be worth running an off licence if they didn't renew.

The fact that they can't even tell me what lager to have with a vindaloo means there isn't a hard act to follow.

[AtW]

One last bit of advice MF - don't make the final decision after heavy drinking.

HTH

[MarillionFan]

One last bit of advice MF - don't make the final decision after heavy drinking.

HTH

Good advice. If I'd known it before I'd still be single, have no kids and not be going grey!