community shop and enterprises business plan...community shop and enterprises business plan ......
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New Galloway Community Enterprises Ltd
Community Shop and Enterprises
Business Plan
August 2016
New Galloway Community Enterprise’s mission is to work with the people of New Galloway to revitalise and sustain our community and its economy by developing business
and social enterprises.
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Contents
Table of Contents 1 Executive Summary........................................................................................................................ 6
2 Project Description ......................................................................................................................... 7
2.1 Summary ................................................................................................................................. 7
2.2 New Galloway Community Enterprises Ltd .............................................................................. 8
2.3 Our Vision ............................................................................................................................... 8
2.4 Mission Statement ................................................................................................................... 9
2.5 Community Needs ................................................................................................................... 9
2.6 Strategic requirements .......................................................................................................... 10
2.7 Social Impacts ....................................................................................................................... 10
2.8 Member benefits .................................................................................................................... 10
2.8.1 Share-holding interest rates................................................................................................... 11
2.8.2 Share liquidity ........................................................................................................................ 11
2.9 Timeline................................................................................................................................. 11
3 Local Context ............................................................................................................................... 14
3.1 Location ................................................................................................................................ 14
3.2 Population ............................................................................................................................. 15
3.3 Transport ............................................................................................................................... 16
3.4 Access to Services ................................................................................................................ 17
3.5 Income .................................................................................................................................. 18
3.6 Employment .......................................................................................................................... 18
3.7 Education and Young People ................................................................................................ 18
3.8 Health .................................................................................................................................... 19
4 Our Services ................................................................................................................................ 20
4.1 The current shop ................................................................................................................... 20
4.2 Shop and house renovation ................................................................................................... 20
4.3 Shop services ........................................................................................................................ 22
4.4 Electric van ............................................................................................................................ 23
4.5 Self-catering accommodation ................................................................................................ 24
4.6 Community Engagement Officer ............................................................................................ 24
4.7 Other community benefits ...................................................................................................... 25
5 Social Impact ................................................................................................................................ 26
5.1 Social Outcomes ................................................................................................................... 26
5.2 Targets and monitoring. ......................................................................................................... 28
5.3 Social Competitive Advantage ............................................................................................... 29
5.4 Co-operative working with other small businesses ................................................................ 29
5.5 The Post Office...................................................................................................................... 30
6 Our Market ................................................................................................................................... 31
6.1 Stakeholder categorisation .................................................................................................... 31
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6.2 Market Research ................................................................................................................... 33
6.2.1 Shop ...................................................................................................................................... 33
6.2.2 Self-catering flats ................................................................................................................... 37
6.2.2.1 Market trends in Dumfries and Galloway. ....................................................................... 37
6.2.2.2 Outdoor enthusiasts ....................................................................................................... 37
6.2.2.3 The Arts ......................................................................................................................... 38
6.2.2.4 Older people and Families .............................................................................................. 38
6.2.2.5 People with family connections to the area ..................................................................... 39
6.2.3 Community Engagement Officer ............................................................................................ 39
7 Marketing Plan ............................................................................................................................. 40
7.1 Marketing – Shop .................................................................................................................. 40
7.1.1.1 Passing trade ................................................................................................................. 40
7.1.1.2 Logo ............................................................................................................................... 41
7.2 Marketing – Self-catering ....................................................................................................... 44
7.3 Local Marketing – Shop, Services and Self-Catering ............................................................. 45
7.4 VisitScotland ......................................................................................................................... 46
7.4.1 VisitScotland Online ........................................................................................................... 46
7.4.2 VisitScotland Information Centres ...................................................................................... 46
8 People .......................................................................................................................................... 47
8.1 Management and Board structure ......................................................................................... 47
8.2 Employees - Shop ................................................................................................................. 49
8.3 Employees – Community Engagement Officer ...................................................................... 49
8.3 Employees – Self-catering flats ............................................................................................. 49
8.4 Staff Management ................................................................................................................. 49
8.5 Enterprise Policies ................................................................................................................. 50
9 The Organisation .......................................................................................................................... 51
9.1 Organisational Structures ...................................................................................................... 51
9.2 Board Protocols ..................................................................................................................... 53
9.3 AGM / Member engagement ................................................................................................. 53
10 Partnership working ...................................................................................................................... 54
10.1 Plunkett Foundation .............................................................................................................. 54
10.2 Community Shares Scotland. ................................................................................................ 54
10.3 New Galloway and Kells Community Council ........................................................................ 54
10.4 Glenkens Community and Arts Trust ..................................................................................... 54
10.5 Glenkens Transport Initiative. ................................................................................................ 54
10.6 Local Initiatives in New Galloway (LING), including New Galloway Town Hall committee. ..... 54
10.7 New Galloway Post Office and other local businesses. ......................................................... 55
10.8 Kells Primary School, New Galloway ..................................................................................... 55
10.9 Dalry High School .................................................................................................................. 55
10.10 Third Sector Dumfries and Galloway .................................................................................. 55
10.11 DGC Business Gateway .................................................................................................... 55
10.12 DGC Community Resilience team ...................................................................................... 55
10.13 DGC Financial Maximisation Team. ................................................................................... 55
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10.14 Stewartry Health and Social Care Integration project ......................................................... 55
10.15 Development Trusts Association Scotland. ........................................................................ 55
11 Operational Plan ........................................................................................................................... 56
11.1 Shop products and mark-up .................................................................................................. 56
11.1.1 Worst credible case scenario. ............................................................................................ 58
11.2 Shop staffing ......................................................................................................................... 58
11.3 Transition into Community Ownership ................................................................................... 59
11.4 Tips to encourage increased sales. ....................................................................................... 59
11.5 Roles and Responsibilities..................................................................................................... 60
11.6 Self-catering .......................................................................................................................... 62
11.7 State Aid................................................................................................................................ 62
12 Fund raising plan .......................................................................................................................... 64
12.1 BIG ‘Growing Community Assets’ fund .................................................................................. 64
12.2 Plunkett Foundation .............................................................................................................. 64
12.3 Galloway Glens Landscape Partnership Scheme .................................................................. 64
12.4 Charitable donations ............................................................................................................. 64
12.5 Share Offer ............................................................................................................................ 65
12.6 Contingency fundraising ........................................................................................................ 65
13 Capital costs ................................................................................................................................. 66
13.1 Assurance ............................................................................................................................. 66
13.1.1 District Valuer ................................................................................................................. 67
13.1.2 Damp Survey ................................................................................................................. 67
13.1.3 Flood risk........................................................................................................................ 67
13.1.4 Structural Survey ............................................................................................................ 68
13.1.5 Legal advice ................................................................................................................... 68
13.1.6 Accountancy / HR support .............................................................................................. 68
13.1.7 Electric van ..................................................................................................................... 68
13.1.8 Shop re-stock ................................................................................................................. 68
13.1.9 Staff training ................................................................................................................... 68
13.2 Renovation Costs .................................................................................................................. 69
13.2.1 Fees ............................................................................................................................... 69
13.3 Total Capital Costs ................................................................................................................ 70
13.4 VAT / Corporation tax ............................................................................................................ 70
13.5 Profit and loss forecasts ........................................................................................................ 71
13.5.1 Shop ............................................................................................................................... 71
13.5.2 Self-catering ................................................................................................................... 72
13.5.3 Combined ....................................................................................................................... 73
13.5.4 Big Lottery Operational Subsidy ..................................................................................... 74
13.5.5 Worst case scenario funding .......................................................................................... 75
13.6 Total grant request ................................................................................................................ 76
13.7 Cash flow .............................................................................................................................. 76
13.8 Member returns ..................................................................................................................... 76
13.9 Sustainability ......................................................................................................................... 77
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13.10 Contingencies .................................................................................................................... 77
14 Risk Analysis ................................................................................................................................ 78
14.1 SWOT analysis...................................................................................................................... 78
14.2 Risk Assessment ................................................................................................................... 80
15 Management to date – Development Phase ................................................................................. 87
15.1 Financial Management .......................................................................................................... 87
15.2 Communication ..................................................................................................................... 87
15.3 Recruitment ........................................................................................................................... 87
15.4 Community Engagement ....................................................................................................... 87
15.5 Local development ................................................................................................................ 88
16 Summary ...................................................................................................................................... 89
16.1 Vision Statement ................................................................................................................... 89
16.2 Meeting the needs ................................................................................................................. 89
17 Declarations of Interest ................................................................................................................. 91
18 References ................................................................................................................................... 91
19 Appendices .................................................................................................................................. 91
Figure 1 - Needs Survey Results ............................................................................................................ 9 Figure 2 - Options Appraisal Results ..................................................................................................... 12 Figure 3 - New Galloway location and High Street, showing the existing shop frontage. ....................... 14 Figure 4 - Stewartry age distribution ..................................................................................................... 15 Figure 5 - Population age trends, D&G ................................................................................................. 15 Figure 6 - Number of vehicles per household, % ................................................................................... 16 Figure 7 - Average weekly earnings, £ .................................................................................................. 18 Figure 8 - The current shop .................................................................................................................. 20 Figure 9 - Example shelving units ......................................................................................................... 20 Figure 10 - Mood Boards showing the look of the flats .......................................................................... 21 Figure 11 – Social Outcomes and Impacts ............................................................................................ 27 Figure 12 – Table of Stakeholders ........................................................................................................ 32 Figure 13 – Results of brainstorming session on suggested stock with Kells School P1-P3s. ............... 33 Figure 14 – Examples of postcards of school children’s work ............................................................... 41 Figure 15 – Line drawings of New Galloway ......................................................................................... 42 Figure 16 – Final logos ......................................................................................................................... 43 Figure 17 – Self-catering marketing options .......................................................................................... 44 Figure 18 – Renovation Phase Organisational diagram ........................................................................ 51 Figure 19 – Operational Phase Organisational diagram ........................................................................ 52 Figure 20 – Predicted Gross Weekly Profit, Year 1 ............................................................................... 56 Figure 21 – Predicted Gross Weekly Profit, Year 5 ............................................................................... 57 Figure 22 – Mark-up sensitivities .......................................................................................................... 57 Figure 23 – Worst credible case scenario ............................................................................................. 58 Figure 24 – Shop staffing levels ............................................................................................................ 58 Figure 25 – Staff roles and responsibilities ............................................................................................ 60 Figure 26 – Self-catering occupancy / income assumptions. ................................................................. 62 Figure 27 – The existing and final ground floor and first floor architectural plans .................................. 66 Figure 28 – Shop Profit and Loss .......................................................................................................... 71 Figure 29 – Self-catering profit and loss ................................................................................................ 72 Figure 30 – Combined Profit and Loss .................................................................................................. 74 Figure 31 – Subsidised Profit and Loss – worst case scenario .............................................................. 75 Figure 32 – Subsidised Profit and Loss – targets met ........................................................................... 76
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1 Executive Summary New Galloway is an attractive village of about 450 people in the Stewartry region of South West Scotland. However the beautiful setting can mask the problems facing the village. There are significant issues regarding infrastructure and sustainability which threaten the future viability of the village and its outlying community. Designated 'remote rural' by the Scottish Government, New Galloway has extremely poor access to many local services. As well as being isolated geographically, the village and the surrounding area suffer from a lack of employment opportunities, low wages and few training or apprenticeship places. ‘Poverty with a view’ is a phrase often used to describe the area. The result of this situation is that young people and families are forced to move away in order to find work. A destructive cycle is created when young families leave. Local shops and other services go into decline, which leads to closure of other businesses or the withdrawal of further services. In turn, the village is rendered a less attractive place to live and work. The remaining, more dependent, population of older people becomes ever more isolated. Like so many rural towns and villages, the loss of facilities in New Galloway is threatening its future viability. The village has just one remaining shop which has been on the market for 9 years. The current owners need to retire and, if no buyer can be found, will have to shut the shop. If the shop were to be lost, the impact would be devastating for the community. The nearest alternative shop is 3 miles away, and public transport links are extremely poor. The community has identified a way of protecting the last remaining shop, whilst creating work and training opportunities, generating income and offering social well-being services for local people. This is to use a Big Lottery ‘Growing Community Assets’ grant, together with a Share Offer supported by the community, to fund the purchase of the shop and the associated 6-bedroom house. The shop will be refurbished as a Community Shop and the house converted into 2 x 2-bedroom self-catering apartments in order to generate an income for the village. In addition, the role of a ‘Community Engagement Officer’ will be created, offering a number of community well-being services that are otherwise simply not available.
Our vision
In 5 years’ time our village will:
Have a thriving Community Shop which operates as a social hub and focus for community involvement for all residents, as well as providing them with the groceries and services they need.
Have established itself as a well-known and popular visitor destination with a coherent tourist offering that leads to repeat bookings, and therefore will have increased the viability of the other local businesses.
Have generated £26,000 of profit from the self-catering accommodation and a further £55,000 when the shop meets its targets. Of this, £32,000 will have been reinvested into the community, £19,000 set aside for legacy projects such as micro-generation and £30,000 maintained as a prudent reserve fund.
Be generating £11,000 of sustainable yearly income from the shop and self-catering enterprise, available into the future for New Galloway and its residents.
Have created a key role in the post of the Community Engagement Officer, who will have facilitated initiatives by local residents, businesses and charities to sustain and enhance the community, while also providing vital social well-being services within the village.
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2 Project Description
2.1 Summary New Galloway Community Enterprises Ltd (NGCE) was formed with the primary intention of maintaining
the provision of a village general store in New Galloway. After assessing the needs of the community, however, it became clear that many more community needs could be met by expanding the project to include self-catering tourist accommodation and a Community Engagement Officer.
1. The shop will:
o Be a Community Shop, owned and managed by the New Galloway community for community benefit.
o Offer good value, high quality food and provisions to New Galloway residents and visitors, with a strong emphasis on local food.
o Act as a community hub, strengthening feelings of community inclusion and decreasing social isolation.
o Support the other small businesses in the area by making New Galloway a more attractive place to visit for tourists.
2. The self-catering accommodation will generate an independent income for the village which can
then be re-invested in the village to meet other charitable needs, including: o Encouraging entrepreneurship through targeted grants to help start-up of micro
businesses. o Supporting the existing community transport initiative to ensure that it can meet the
needs of the New Galloway community. o Maintaining facilities and services that contribute materially to the physical or mental
well-being of the residents, such as the play-park, toddler groups and projects for older people.
o Creating a legacy within the community by putting aside funds towards larger projects, either for use as matched funding with other funders or as capital funds.
3. The Community Engagement Officer will work out of the large back-office of the shop and will
deliver various social well-being services to the village. They will: o Operate a community engagement service including:
Advocacy - understanding and accessing benefit entitlements (particularly older and unemployed people), including expert drop-in clinics.
Sign-posting – supporting people to access relevant services in the event of a life-changing event.
Befriending - supporting the more vulnerable members of our community in non-crisis situations such that they are informally monitored and helped.
o Foster a more vibrant local economy by:
Working with existing small businesses and facilities such as the Town Hall to create, maintain and promote a unified tourist resource and to increase services for New Galloway.
Working with local entrepreneurs to encourage their ideas and provide access to wider support, including expert drop-in clinics.
o Ensure that a holistic view for meeting the needs of the residents and visitors is achieved by partnering with existing charitable providers in the village. For example by increasing the volunteer pool in the village, referring people across the services or by partnering with the CatStrand to offer accommodation deals for their big events.
o Enhance community resilience to emergency situations by coordinating the DGC and volunteer efforts at such times, and using the self-catering accommodation as a community refuge when possible.
o Facilitate community projects – small or large scale projects, such as oil and wood-pellet co-operative buying systems, or community event days.
At all times, NGCE will seek to use its assets (property and staff) to meet the community’s needs in a flexible and relevant way, while ensuring that the business model on which it is based is sound and sustainable.
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2.2 New Galloway Community Enterprises Ltd NGCE is a Community Benefit Society (BenCom), established on the 19th June 2015 for the purposes of this project. Most Community Shops in the UK are run by BenComs, which are a modern form of Industrial Provident Societies. They trade commercially, but all profits are re-invested in the local community. They are regulated by the Financial Conduct Authority. Our certificate of registration with the FCA is given in Appendix 2a, showing our registration number 7143. The registered address of NGCE is currently Dalveen, Kirk Road, New Galloway, DG7 3RS. This will change to the shop address immediately on purchase. NGCE offers limited liability to its Shareholders in that the most they can lose is the amount they have invested. The assets of the Society cannot be disposed of for private profit but are subject to an asset lock. If the Society’s assets are sold in the future, wherever possible investors are repaid and any surplus is then given to another cause operating for the benefit of the community. NGCE currently has 81 members, a number which is expected to increase significantly after the planned Share Offer. Note that every member has one vote in the Society regardless of the size of their shareholding. There is currently a voluntary management committee of 7 local residents, all of whom are heavily involved in community activities and range in age from 37-71. The management committee has a broad skill-base including small business ownership, project management and charitable governance. The objectives of New Galloway Community Enterprises are:
To maintain and improve the village shop provision in New Galloway.
To make New Galloway self-sustaining in the longer term by generating an independent income.
To promote the development of tourism in New Galloway.
To support local economic development and encourage entrepreneurship.
To offer social well-being services to the community.
2.3 Our Vision In 5 years’ time New Galloway will:
Have a thriving Community Shop which operates as a social hub and focus for community involvement for all residents, as well as providing them with the groceries and services they need.
Have established itself as a well-known and popular visitor destination with a coherent tourist offering that leads to repeat bookings, and therefore will have increased the viability of the other local businesses.
Have generated £26,000 of profit from the self-catering accommodation and a further £55,000 when the shop meets its targets. Of this, £32,000 will have been reinvested into the community, £19,000 set aside for legacy projects such as micro-generation and £30,000 maintained as a prudent reserve fund.
Be generating £11,000 of sustainable yearly income from the shop and self-catering enterprise, available into the future for New Galloway and its residents.
Have created a key role in the post of the Community Engagement Officer, who will have facilitated initiatives by local residents, businesses and charities to sustain and enhance the community, while also providing vital social well-being services within the village.
In order to achieve this, the three connected projects of NGCE have quite different funding and management expectations:
The Community Shop is expected to be sustainable by Year 5, but will never make a huge profit. Its contribution to the community will instead be the tangible and intangible benefits of a thriving village shop.
The self-catering accommodation exists primarily to create a sustainable income stream for the community and should therefore be immediately generating funds from Year 2, when it opens.
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The Community Engagement Officer’s outputs are 100% charitable in nature and free for users, so the funding for this will always come from grants – it will never be able to be self-sustaining.
2.4 Mission Statement
2.5 Co
mmunity Needs The forerunner of NGCE carried out a Needs Survey in May 2015 around New Galloway in order to establish the basic needs of the village. This survey had an excellent response rate of 81%, showing high levels of interest and enthusiasm for the idea. The full results of this survey are attached in Appendix 1.
Figure 1 - Needs Survey Results
As shown in this chart, the top four needs identified by the village were: 1 Availability of local jobs 2 Public transport 3 Social isolation 4 Youth training These results accord well with the wider picture of the area. Designated 'remote rural' by the Scottish Government, New Galloway has extremely poor access to many local services. As well as being isolated geographically, the village and the surrounding area suffer from a lack of employment opportunities, low wages and few training places. More details of this are given in Section 3: Local Context.
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
New Galloway Needs Survey, May 2015. Importance of need x Requirement for action
To work with the people of New Galloway to revitalise and sustain our community and its economy by developing business and social
enterprises.
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2.6 Strategic requirements
This project will require:
A creative, entrepreneurial approach.
Buildings that are fit for purpose, meeting all modern health and safety, fire, equalities and environmental standards.
An effective marketing strategy, especially for the self-catering accommodation, including an integrated digital presence and an identity that is reflected and reinforced on the premises and in all marketing materials.
Earned income generation from the self-catering accommodation and shop, to re-circulate into the project and to support other community projects in New Galloway.
The continued development of a good visitor base within the village and further afield.
The appropriate staff to ensure that the vision for the project is carried out on a daily basis.
The ongoing support of the local community, both in terms of visiting the shop and using the services of the Community Engagement Officer, and in terms of concrete support of the Share Offer.
This business plan sets out how we plan to address all of these issues.
2.7 Social Impacts This project will make a number of social impacts. The most critical of these are:
Households with lower incomes, households without cars, older and vulnerable people and people with caring responsibilities will be able to source an affordable meal without leaving the village.
People’s health will be improved by having access to good value fresh fruit and vegetables and the impact on the environment is lessened by selling low food-mile produce.
Residents can meet and chat in the shop, increasing the sense of community-belonging and decreasing social isolation.
Local charities and voluntary organisations can carry on meeting the needs of the community by accessing grants in a short timescale.
Local businesses will see an increase in footfall and hence the local economy will thrive and become increasingly sustainable.
Volunteers feel included in the community and well-being is enhanced. For those volunteers looking to return to or start work, their CV is enhanced by their experiences.
Through the agency of the Community Engagement officer, local residents will have the opportunity to access a range of supportive services, whether seeking advice on benefits and income-maximization or in dealing with life-changing events
More details of this are given in Section 5: Social Impact
2.8 Member benefits Membership of NGCE offers the chance to have a say in the future of some of our last remaining village infrastructure. As with any co-operative, member-owned society, there are clear benefits to becoming a member:
Access to information about the operation of and plans for the society.
A voice in the society – all members (regardless of size of shareholding) have one vote in matters pertaining to the future of the society.
The opportunity to become elected to a representative role in its governance.
These benefits are enshrined in our ‘Model Rules’ or constitution, given in Appendix 2.
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Other member benefits:
Regular communication via a Shop and Enterprises newsletter.
First invitation to ‘meet the producer’ and tasting days.
Special and periodic discounts for members only.
Short-notice discounted accommodation deals (as bookings allow).
2.8.1 Share-holding interest rates
There is the theoretical possibility of being able to receive interest from a share-holding (capped at 2% above the Bank of England base rate), but the present Board of NGCE is clear that this should not be an expectation held by share-holders. No interest will be paid for at least 5 years while the business is establishing itself, and at the discretion of future Management Committees after then. Purchase of a share-holding in NGCE and hence the Community Shop should be seen as a social investment in the future of our community, not as a means of realising monetary value from that investment.
2.8.2 Share liquidity The Model Rules (constitution) of NGCE (Appendix 2) gives the full details of the conditions under which shares may be withdrawn from the company in Section 8.4. In summary: Shares are withdrawable at the sole discretion of the Board, and only if the following conditions are met:
Shares have been held for a minimum of 3 years.
3 months’ notice has been given for withdrawal.
The withdrawal can be funded from trading profits without prejudicing the long term interests of the society. Note that withdrawals can also be paid from reserves and new share capital.
It is unlikely that the Society will be in a position to repay shares (unless on death) for the first five years. The Society will, if profits allow, aim to make 10% of share capital available for withdrawal each year after year 5.
2.9 Timeline
In September 2014, in response to the owners of the existing shop indicating that they would shortly have to shut it if no buyer could be found, a well-attended Open Meeting was held. The meeting showed an overwhelming level of support within the room for the idea of buying the shop and creating a Community Shop and Hub. An informal working group of local residents therefore carried out an initial house-to-house survey of the village, to canvass opinion about the need for a village shop. An excellent response rate of 82% to this survey revealed that all but 2 responses were positive towards the idea of a community shop. This survey also asked what facilities the shop should offer, which has informed the working of the group that became NGCE ever since. The high response rate to this survey gave the working group the mandate to pursue the idea further, which they did through visits to other local community shops, working with the Plunkett Foundation to secure a mentor and a best-practice visit, and continuing to engage and consult with the local community. It was decided at this point to apply for a grant to the Big Lottery ‘Growing Community Assets’ fund, which seemed to suit our purposes well. The fund is designed to support communities in Scotland to take more control and influence of their future through acquiring and developing their own assets such as land or buildings. Funds secured range from £10,000 to £1 million. Projects can be funded for up to five years and up to 100% of project costs can be met. For more details, see Section 11.1. Therefore in May 2015, a house-to-house Needs Survey was carried out, in order to ascertain the needs of the community and to ensure that the project was meeting as many of them as possible. This received an 81% return of all questionnaires given out.
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A comprehensive Options Appraisal was also carried out in May 2015, to ensure that the right long-term solution for the community was found. While the original idea was mooted within the village in response to the fear of closure of the existing shop, it was important to take a step back and check whether the needs of the community could be met in a different way. Various different options for a shop were considered, such as within the Town Hall, in a different existing High Street building or as a new-build, and were rated according to key criteria. These showed that the ‘existing shop and self-catering’ option came out well ahead, due to the sustainability through income generation that it offered. The added cost and complexity of the bigger project was a downside, but not one that outweighed the potential gains.
Figure 2 - Options Appraisal Results
The full Options Appraisal is attached in Appendix 3, updated with text to reflect the current (August 2016) situation. In June 2015, New Galloway Community Enterprises Ltd was formally constituted and registered by the FCA as a Community Benefit company. This was required in order to ensure the correct legal body could apply for and receive Big Lottery funds. Also in June 2015, the Stage One application was submitted to the Big Lottery fund, and in September 2015 it was accepted. Further work was then required to secure tenders from Architects and Development Consultants, as well as understanding fully all of the development costs involved in creating a Stage 2 application. Once this was complete, a request for £44,153 of development funding was made in December 2015 and this was granted in full in late February 2016. All work done until this point was entirely voluntary. Once the development grant was received, a technical team comprising the Architect, Development Consultants, Local Project Manager and Communications Officer was engaged and the detail of the Stage 2 application was entered into. The Stage 2 application will include the purchase and renovation cost of the house and shop, plus some operating costs for the first 5 years of the project. The Stage 2 application will be submitted in August 2016, with the Big Lottery decision expected in late 2016. If successful, the existing shop will be bought in early 2017, will trade for ~4 months in a similar format to that presently to allow time for the renovation contracts to be prepared and awarded, and will then re-open as the New Galloway Community Shop after a month-long renovation in mid 2017. The house will take longer to renovate, and the self-catering accommodation will open to visitors in late 2017.
0
10
20
30
40
50
60
Existing shop &self-catering
Existing shopalone
Shop in Townhall
Shop in a houseNew-build shop
Ownership
Planning permission
Size
Flexibility
Physical condition
Location
Accessibility
Safety
Costs
Risks
Timescale
Environmental impact
Community buy-in
Sustainability
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3 Local Context
3.1 Location New Galloway is a small remote-rural village in the Glenkens, which is part of the Stewartry district of Dumfries and Galloway, South West Scotland. New Galloway was a Royal Burgh and is located at the intersection of the roads going northwards to Ayrshire, southwards to Kirkcudbright and the Solway Coast, eastwards to Dumfries and westwards to Newton Stewart and Stranraer. It is 25 miles west of Dumfries, 20 miles north of Kirkcudbright, 36 miles south of Ayr and 18 miles east of Newton Stewart. The village sits at the head of Loch Ken and close to the western section of the Southern Upland Way.
“New Galloway lies within the Galloway Hills Regional Scenic Area and much of its historic core is designated as a Conservation Area. The land east of the village is adjacent to several natural heritage sites such as the Loch Ken and River Dee Marshes Special Protection Area.” – The Stewartry Local Area Profile, Crichton Institute.
Figure 3 - New Galloway location and High Street, showing the existing shop frontage.
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3.2 Population
New Galloway is composed of 3 area profiles on Scotland’s most recent census results of 2011 and has an estimated population of 450 residents within the village and a further 550 in the outlying parish. 12.6% of the population of New Galloway are children aged 5 – 15 and 11.2% are aged 16 – 291. At the other end of the spectrum, 22.5% are aged 65 and above. When these figures are expanded slightly to include the district of Stewartry, (within which New Galloway resides) and compared with figures for Dumfries & Galloway and Scotland, a clear trend of an ageing population is evident, as can be seen in the table below2.
Population by Age Group (%)
Stewartry Dumfries and Galloway
Scotland
0 – 15 15.3 16.6 17.3
16 – 24 8.3 9.6 11.9
25 – 44 19.3 21.7 26.4
45 - 64 31.5 30.2 27.4
65+ 25.6 21.8 16.8 Figure 4 - Stewartry age distribution
There is a relative lack of working age younger people (16 – 44) in the Stewartry district, whilst there is a much higher proportion of older and retired people aged over 65, compared with the county and the nation as a whole.
Furthermore, these trends are predicted to become increasingly significant for Dumfries and Galloway. It is projected that the number of older (especially 75+ years) residents will increase2, whilst numbers of working age people, young people and children will decrease. When considering how closely the Stewartry’s population breakdown matches that of Dumfries and Galloway, it is reasonable to assume that projected demographic changes for the county as a whole will be reflected in New Galloway and the surrounding areas. The graph below from the Stewartry Local Area Profile, compiled in 2015 by the Crichton Institute in Dumfries, highlights the projected population changes in Dumfries and Galloway in 2020 and 2030.
Figure 5 - Population age trends, D&G
A relatively large proportion of elderly people suffer from a reduction in mobility and consequently struggle to access amenities located outwith a very small distance. An increase in older residents in villages such as New Galloway will result in an even greater number of people relying on local service provision, where a form of transport (private or public) is not required for access. Local services within New Galloway, especially a general store, will become critically important to an increasing number of residents.
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3.3 Transport
New Galloway public transport services are infrequent, slow, and inconveniently timed. Services are inadequately integrated to other bus and train timetables. There is no Sunday service. Route 520 links New Galloway with the other Glenkens villages and Castle Douglas. There are six services per day in each direction, some doubling as school services and therefore even slower. Two of these services run on north to and from Dalmellington in Ayrshire and offer an indirect connecting service to and from Ayr with a journey time of 105mins (compared with 55 mins by car) and allowing less than 3 hours in Ayr. The last bus out of Castle Douglas is at 17:05 making it almost possible to use buses for work commuting. Route 521 is the only direct link to Dumfries, with one service in each direction arriving in Dumfries at 08:50 and leaving at 17:15, giving restricted options for commuting. The Saturday service allows less than 3 hours in Dumfries. The Glenkens Community Transport Initiative operates an evening shopping service to Castle Douglas once a week.
The nearest airport is 43 miles north in Prestwick. For flights outside Europe, people in New Galloway must travel to Glasgow airport (76 miles away), Edinburgh airport (90 miles away) or Newcastle airport (111 miles away). There is no taxi service based in the Glenkens. The nearest is in Castle Douglas, 13 miles away Poor and expensive public transport creates access barriers for many people living in New Galloway, many of whom seldom travel outside of the county.
The graph below from The Stewartry Local Area Profile shows the number of vehicles per household, as a percentage. As a direct result of the very poor public transport, there is a high percentage of households within the Stewartry and therefore New Galloway with one or more cars. However, there is still a worrying 17% in the district that do not have access to their own car and must therefore rely on the poor public transport infrastructure or the kindness of friends.
Figure 6 - Number of vehicles per household, %
These statistics highlight the importance of the village store in New Galloway as a means of accessing groceries and provisions, as well as community interaction, within walking distance for residents.
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3.4 Access to Services
The percentage of the population living in remote rural areas is 40% in Stewartry, compared to a 23% average in Dumfries and Galloway and a 6% national average for Scotland 3. A means of analysing small population areas that have a concentration of characteristics associated with deprivation is the Scottish Index of Multiple Deprivation (SIMD). It is an official tool developed and used by the Scottish Government and the current 2012 release is based on 37 indicators in 7 domains. These 7 domains are:
Current income
Employment
Health
Education, Skills and Training
Housing
Geographic Access to Services
Crime
The Scottish Index of Multiple Deprivation (SIMD) classifies the datazone for New Galloway as ‘remote rural’; the most rural classification on the six fold scale, with a drive time of over 30 minutes to a settlement of 10,000 or more. In fact, the drive time to the nearest settlement with a population of over 10,000 is 50 minutes.
The chart below is taken directly from the 2012 SIMD report and shows the New Galloway data zone information.
Data Zone Location Tot.
Pop Overall SIMD Rank
Income SIMD Rank
Employment SIMD Rank
Health SIMD Rank
Education SIMD Rank
Housing SIMD Rank
Geographic Access SIMD Rank
Crime SIMD Rank
S01001044 New Galloway
329 ???? 3,412 3,688 5,130 4,906 3,303 800 5,331
Key:
Most Deprived 1 – 1301 1302 – 2602 2603 – 3903 3904 – 5204 5205 - 6505 Least Deprived
It is clear that New Galloway is well into the most deprived category for geographic access to services. Interestingly, this is not a new trend, as the chart below shows – the SIMD results for geographic access have not risen out of the ‘Most deprived’ category for at least 12 years.
Year Geographic Access SIMD Rank
2009 635
2006 1058
2004 675
It is probable that the above results for geographic access are actually more generous than in reality. The SIMD classifications do not take population density and congestion into consideration. For example, even though people living in rural areas such as New Galloway frequently need to travel long distances to access services, the lack of congestion to and within rural villages decreases the time taken to travel to local service centres. Therefore, when solely considering the distance in miles to services, New Galloway would most probably be rated as even more deprived than its statistics currently show.
This rural context, coupled with the poor public transport infrastructure, presents a clear picture of how isolated New Galloway is, resulting in a much higher dependency on existing local facilities than other villages of a similar population that are closer to urban centres.
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3.5 Income
Reliable and up-to-date information on income levels in small areas is limited, but evidence from the Annual Survey of Hours and Earnings shows that average wages in Dumfries and Galloway are significantly lower than the Scottish average and that this gap has widened since the start of the recession in 2008.
Figure 7 - Average weekly earnings, £
The Office of National Statistics (ONS) statistics show that full-time weekly earnings in Dumfries and Galloway are in the lowest wage bracket; 1 of only 3 regions out of the 28 in Scotland. SIMD data suggests that 2,535 people, approximately 11% of the population, in the Stewartry are ‘income deprived’.
3.6 Employment
Using Stewartry-wide data, we can infer that there are 191 people aged 16-65 in New Galloway but that only 120 people (62.8%) actually in employment2. The three employment sectors with the highest employment rate in New Galloway are ‘skilled trade occupations, ‘elementary occupations’ and ‘professional occupations’. Interestingly, the sectors with some of the lowest employment rates are ‘sales and customer service’ and ‘administration and secretarial occupations’2. It can be deduced that the low employment rates in the above sectors are due to the lack of local services and amenities available in New Galloway.
3.7 Education and Young People
New Galloway has one primary school with a current school roll of 28 and there is a small secondary school in neighbouring village, St Johns Town of Dalry. Dalry Secondary School takes pupils up to the end of S4 and they then transfer to Castle Douglas High School for S5 and S6, if they choose to continue their school education. There are no further education institutions in the local vicinity; students must travel 25 miles to both Dumfries College and the University of the West of Scotland (UWS) Dumfries campus, 33 miles to Barony Agricultural College just north of Dumfries, 42 miles to Stranraer College or 36 miles to Ayr College and the UWS Ayr campus. Other universities are located further afield in Glasgow, Edinburgh, Stirling, Dundee, Aberdeen, Carlisle or Newcastle, all of which are between a 2 and 5 hour drive away. Consequently, at the time of the 2011 census, there were only 3 full time students aged 18 – 74 residing in New Galloway. Furthermore, the poor access to higher and further education in New Galloway has led to there being 29.1% of people aged 16 and above with no qualifications at all, which is above the Scottish national average of 26.8%1.
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3.8 Health 13% of New Galloway residents2 are limited by long-term health problems or disabilities. This is higher than the Scottish average of 9% 1 and gives a good indication of the number of people who would struggle to shop for themselves outwith the village.
Removal of local services results in a huge barrier to accessing vital services and
consequently a decline in the health and well-being of many residents. They may be forced to move away to more urbanised areas, further threatening the viability of any remaining facilities in the village and ultimately resulting in increased economic decline in the area.
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4 Our Services
4.1 The current shop
The shop currently serves as a general store, but the primary focus is groceries, newspapers and magazines. The shop has been gradually run down over the past 5 years as the owners prepare to retire. The consequence has been a narrowing of the product range and reduced opening hours, resulting in falling sales and profits.
Figure 8 - The current shop
As the picture shows, current stock levels are low and the large counter can restrict customer freedom of choice.
4.2 Shop and house renovation
The existing shop and attached 6-bedroom house will be purchased at a market price set by the District Valuer and mutually agreed.
The shop will be renovated to create a modern, accessible and attractive grocery shop. The shop will be useful and relevant to locals, while also attractive and welcoming to tourists. This will completely restore and ensure the survival of this critical piece of village infrastructure.
Figure 9 - Example shelving units
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2.6 FTE jobs will be generated in the shop, as well as volunteering and work experience placements.
The house will be renovated to a modern standard for self-catering accommodation, including compliance with all relevant sound, fire and thermal insulation requirements. A modern biomass heating system will be installed and all regard given to environmental issues, such that the final property will be warm, dry and easy to maintain as such.
Figure 10 - Mood Boards showing the look of the flats
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The architect’s plans (Appendix 4) show a well thought-out, modern and practical solution to the conversion. The renovated property will comprise 2 x 2-bedroom apartments, each sleeping 4 people. We have full planning permission for these plans, granted by DGC on the 4th July 2016, ref 16/P/2/0139.
When established, these tourist flats will generate ~£9,000 pa of sustainable income for the village which will be targeted at meeting the wider needs of the community. For details of these needs, see Section 4.4.
We will offer a range of other community services through a Community Engagement Officer, based in an office at the rear of the shop. For details of this role, see Section 4.5.
4.3 Shop services NGCE have surveyed the local community extensively to ascertain the facilities that the shop should offer. The results indicate that local fresh produce will be particularly welcomed. NGCE will expand the current range of products, providing people with more choice and therefore increasing turnover. The shop will have 4 key markets:
Residents who require access to good value food within walking distance.
People who are interested in high quality local produce.
Residents who have run out of food basics (bread, milk etc).
Tourists who have holiday money to spend on local products and treats. The shop will stock a number of lines in order to meet all these requirements. Most canned and preserved goods will be offered at two price points e.g. both ‘Happy Shopper’ and ‘Heinz’ tomato ketchup. We have secured agreement with:
Grierson’s butchers (Castle Douglas) to supply fresh meat weekly and deliver orders.
Fleet Fish (Gatehouse of Fleet) to supply fresh fish weekly and deliver orders.
Cream O’Galloway Icecream (Kirkcudbright)
The Sulwath Brewery (Castle Douglas beers)
Love To Eat, a New Galloway producer of high quality frozen meals.
Heavenly Nutty peanut butter (Dalry)
Galloway Chillies range of chilli chutneys (Wigtown)
Crow Kitchen, home-made oatmeal biscuits in Dalry.
We also expect to offer (from within the village):
Home baking
Quiches
Eggs
Honey
Local fresh fruit and vegetables
Where these are supplied on a small scale by people living in the parish of New Galloway, we will sell them at a preferentially discounted commission rate, in line with our policy of encouraging micro-businesses in the community.
We will market this local produce strongly, advertising the food miles of each product and using separate shelves for local produce. We will also offer ‘meet the producer’ and taster days, in order to reconnect local people with the food available from this region.
As an important note, we will ensure that the heating and lighting systems are permanently tied into an emergency diesel generator such that the boiler and lights will
continue to work in the event of a power cut. This means that the shop and flats will be a warm, lit community asset in the event of a disastrous weather event such as flood or
snow, or other disruption, and as such can act as a community refuge.
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We will also sell (as advised by our consultations):
Newspapers and magazines
Cigarettes
Alcohol
Fizzy drinks, ice lollies, crisps and sweeties
Pre-packed sandwiches
Fresh milk
Coffee, tea, juices etc
Tinned and packaged staples
Fishing supplies – lines and weights
Fishing net, footballs etc in the summer.
Household supplies – toilet rolls, cleaning goods
Toiletries
Pet food
Nappies and baby wipes
Over-the-counter medicines
OS Maps and outdoor guides
Plants & seeds
In look, the shop will be modern, welcoming and accessible. The existing step in the floor will be removed and the till will be moved to the rear of the shop. The large counter will be removed and people will be encouraged to linger and browse.
4.4 Electric van
Our research suggests that having a shop vehicle to transport stock in (as opposed to relying on on-line deliveries) will help us achieve our necessary mark-ups, by allowing the Shop Manager to spot promotions and to ensure high-quality produce is sourced. It can also be used for deliveries, and can be hired out to the community as an extra resource. In line with our overall ethos for the shop and project, it will be an electric vehicle, and can therefore be charged for free at the charging point in New Galloway car park. This will minimise monthly operating costs and impact on the environment. Details of a likely candidate are given in Appendix 6.
The shop will continue to be the community hub of the village; a place where people can meet, socialise, find out about local events and seek support. By creating a robust
business model for the shop and ensuring it meets the needs of its target markets, these other more intangible services that a village shop offers will be assured.
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4.5 Self-catering accommodation The six bedroom house above and behind the shop will be converted into two high-quality self-catering holiday units. These will generate an income that will be used to meet other needs of the community. They will also support other small local businesses in the village, such as the pubs and tearooms, by bringing in an increased level of tourist visitors and therefore disposable income into the village. This will enable NGCE to work towards making the shop, and even the whole village, self-sustainable.
It is predicted that the self-catering flats will generate £8,900 pa income for the village which will be targeted at meeting the wider needs of the community:
1. Job creation: Encouraging entrepreneurship through targeted grants to help start-up of micro businesses.
2. Public transport: Supporting and extending existing community transport links. 3. Community well-being: Maintaining facilities and services that contribute materially to the physical
or mental well-being of the residents, including if necessary the community shop. 4. Legacy projects: Money set aside as seed money to help fund larger schemes such as micro-
generation projects that will in turn provide an income for the village for many years to come.
In order to generate this level of income, the flats will have to be attractive, well-priced and well-marketed. We will out-source the bulk of the marketing to a national booking agent, while still advertising ourselves in local publications that target our specific markets. See Section 6: Our Market for more details.
In accordance with good governance principles, a Reserve Fund is required to cover capital repairs, operating costs in times of economic down-turn and redundancy costs. This is expected to be generated by shop profits (after Big Lottery subsidy) but some self-catering income may be required to top this up if it does not meet our target level of £30,000 by the end of Year 4.
4.6 Community Engagement Officer
We will offer a range of services through a 16 hr/week Community Engagement Officer based in the large back-office of the shop. As summarised in Section 2.1, they will:
1. Operate a community engagement service including:
Advocacy - understanding and accessing benefit entitlements (particularly older and unemployed people), including expert drop-in clinics.
Sign-posting – supporting people to access relevant services in the event of a life-changing event.
Be-friending - supporting the more vulnerable members of our community in non-crisis situations such that they are informally monitored and helped.
2. Foster a more vibrant local economy by:
Working with existing small businesses and facilities such as the Town Hall to create, maintain and promote a unified tourism resource and to increase services for New Galloway.
Working with local entrepreneurs to encourage their ideas and provide access to wider support, including expert drop-in clinics.
3. Ensure that a holistic view for meeting the needs of the residents and visitors is achieved by partnering with existing charitable providers in the village. For example by increasing the volunteer pool in the village, referring people across the services or by partnering with the CatStrand to offer accommodation deals for their big events.
4. Enhance community resilience to emergency situations by coordinating the DGC and volunteer efforts at such times, and using the self-catering accommodation as a community refuge.
5. Facilitate community projects – small or large scale projects, such as oil and wood-pellet co-operative buying systems, or community event days.
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In addition, they will:
6. Run volunteer food-business courses on how to meet Environmental Health and Labelling standards, to encourage the creation of food micro-businesses.
7. Open the communal laundry needed for the self-catering accommodation to New Galloway residents at certain times.
8. Partner with the local Glenkens Transport Initiative (GTI) to offer a free bus service to and from the shop and the local community lunch on Tuesday mornings.
9. Offer our electric van for hire within the community. There is no local vehicle hire service.
10. Offer bike hire to the self-catering visitors and residents to create a self-employed opportunity and increase physical activity levels in the area.
These services are not offered in our community at present, and so meet needs that are currently unsupported. We will monitor the effectiveness and usefulness of these services over time (see Section 5: Social Impacts) and will be deliberately nimble and responsive to the changing needs of our community. Once the Community Engagement Officer is established in role, they will be well tied in to our small community and able to judge these needs effectively. As part of our growth aspirations for this project and for New Galloway, we expect this role to become over-subscribed by Year 4. In the light of this, we have applied to the ‘Galloway Glens Landscape Partnership’, a 5 year Heritage Lottery project expected to start in the area in 2017, for a further half day a week of funding for this role in years 4 and 5.
4.7 Other community benefits
It is also critical to maintain and improve the often un-noticed elements of a village shop which foster social inclusion and community well-being. A thriving shop can operate as a community hub in a small village, being completely non-elitist and open to all. We will therefore offer:
A ‘surplus home-grown food swap’. This will reduce waste and food miles, as well as benefiting health by increasing the availability of cheap fresh produce.
Advertising of local events. This will support our fellow third sector organisations in their efforts, as well as promoting a sense of community belonging.
Promotion of local produce in the shop. This will reduce the food-mile burden of the village, as well as boosting the local economy by supporting local businesses.
A weekly raffle, profits to local charities. This will encourage social interaction within the shop, increasing well-being, as well as creating some extra funds for charities.
Community events e.g. apple-pressing. These will further increase community cohesion and the sense of belonging.
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5 Social Impact
As mentioned in Section 2.7, the shop and enterprises are expected to make a high level of social impact, especially in such a small village as New Galloway. It is also important to note that it is not just a positive impact that will be gained from improving the current shop provision and offering new community services – there will also be a very real negative impact if the shop closes. Not buying the shop for the community will not result in the status quo being maintained – it will decrease social impacts significantly.
5.1 Social Outcomes The main social outputs, outcomes and impacts for this project are summarised in the table below.
Social Output
Social Outcome Social Impact
Supply good value food within walking distance for New Galloway residents.
1. Every staple product line in the shop has a good value alternative.
2. Sufficient products are always stocked to be able to put together a nutritious daily menu.
3. Stock levels will be adjusted to reflect upcoming weather expectations.
Households with lower incomes, households without cars, older and vulnerable people and people with caring responsibilities will be able to source an affordable meal without leaving the village.
In times of flood or snow, when the village is cut-off from all other settlements, residents will be able to source an affordable meal.
Stock the shop with high quality local produce.
4. Fresh fruit and veg is always available in the shop.
5. Residents bring in surplus produce to swap or sell.
6. Local producers of all scales are encouraged to sell through the shop and are promoted effectively.
The local economy is boosted by supporting existing local producers and encouraging micro-businesses to start.
People’s health is improved by having access to good-value fresh fruit and vegetables.
The impact on the environment is lessened by selling low food-mile produce and by encouraging people to shop in the local store instead of travelling to Castle Douglas, a 26 mile round trip.
Ensure the shop is a welcoming environment where residents and visitors are encouraged to stop and chat.
Post advertising of local events and opportunities on a dedicated notice board.
7. Staff are trained and expectations are made clear as to their social role as well as their trading role.
8. Notice board is well maintained and up-to-date.
Residents can meet and chat in the shop, increasing the sense of community belonging and decreasing social isolation.
Vulnerable residents feel part of a caring community and unexpected changes to routine can be followed up on.
Create 1 full-time and 5-6 part-time jobs directly as part of this project.
Offer work-experience opportunities for local teenagers.
Offer volunteering opportunities for local residents.
9. Recruit a Shop Manager (full-time), 2-3 shop assistants, a housekeeper / cleaner, a gardener and a 2-day a week Community Engagement Officer.
10. Work with Dalry and CD High School to offer work experience to 4 students a year.
11. Ensure volunteers get full training and work experience in all aspects of the project.
The local economy is boosted by the creation of jobs.
Students are better equipped to start work and have a higher chance of finding work due to an enhanced CV.
Volunteers feel included in the community and well-being is enhanced. For those volunteers looking to return to or start work, their CV is enhanced by their experiences.
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Generate an income for the village that is available to meet further needs of the village.
12. From Year 2 of trading onwards, dispense targeted grants to help start-up of micro businesses (10% of available profit after the Reserve fund is created).
13. From Year 2 of trading onwards, dispense grants to support and extend existing community transport links (30%).
14. From Year 2 of trading onwards, dispense grants towards maintaining facilities and services that contribute materially to the physical or mental well-being of the residents (25%)
15. Set aside funds as seed money to help fund larger schemes such as micro-generation projects that will in turn provide an income for the village for many years to come (35%).
The local economy is boosted by the creation of micro-businesses.
Public transport links will be enhanced such that they are more useful to local residents e.g. for gaining employment outside New Galloway.
Local charities and voluntary organisations can carry on meeting the needs of the community by accessing grants in a short timescale.
Larger projects that require matched funding have some funding to start the process.
The village becomes self-sustaining in meeting its needs and has an increased sense of ownership of its services and its future.
Bring extra visitors into the area (through the self-catering flats) or encourage them to stay longer in an inviting shop.
16. The self-catering flats are well-marketed such that they are occupied for at least 45% of the year.
17. The shop is a pleasant and welcoming environment for all, with a range of staples and treats that will encourage people to stay and browse.
Local businesses will see an increase in footfall and hence the local economy will thrive and become increasingly sustainable.
New entrepreneurial opportunities will present themselves and new micro-businesses will be created to meet them.
Offer a sign-posting service through the Community Engagement Officer that will allow people to access relevant social services at times of life upheaval.
Host financial-maximisation surgeries to ensure that older and unemployed / low-waged people are aware of the range of benefits they are entitled to.
18. People who are recently bereaved, divorced or unemployed will have the opportunity to find out more about the services available and helped to access them if they so wish.
19. 2-monthly surgeries held on a variety of relevant topics.
Local residents will have the stress of large life events reduced by a supportive system that guides them through.
Local residents will be assured that their income is maximised, or supported in achieving this.
Administer oil and wood-pellet buying co-operatives from the back-office.
20. Local residents sign up for the co-operative and save money on their fuel bill.
Rural fuel poverty is reduced and all participants experience economic benefits.
The impact on the environment of multiple tanker visits to the village is lessened due to a more efficient schedule.
Partner with the Glenkens Transport Initiative to offer free bus transport to and from the shop and the local Tuesday Town Hall lunches.
21. 5 people per week in Year 1 brought in from the surroundings for a social trip out and to purchase provisions.
The social isolation facing (particularly) older people living in extremely remote areas is alleviated.
More people are trained as volunteer drivers, increasing community capacity and personal skills.
Offer training courses in Environmental Health registration and food labelling standards for new businesses wishing to supply the shop.
22. 4 people trained in the first year; 2 in subsequent years.
23. 1 micro business created that goes on to sell to other suppliers.
The local economy is boosted and the barriers to micro-business creation are reduced.
Figure 11 – Social Outcomes and Impacts
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5.2 Targets and monitoring.
Social Outcomes 1-8, 10-11 and 17 (to do with the shop function) will be listed in the operational policies for the shop, will be included in staff training and will form part of the roles and responsibilities of the shop staff and therefore be part of their annual review process. They are black and white statements of expectation to which the required answer at each annual review is ‘Yes’.
Social Outcome 9 will be assured at the very beginning of the scheme.
Social Outcomes 12-15 are dependent on the self-catering flats generating the expected profit. They are expressed as a percentage of the profit rather than as an expected amount, in order to make it clear how we will apportion the income. The actual values will be reviewed annually by the Board and the assumptions behind the forecast updated with the most recent actual data.
Social Outcome 16 is dependent on the quality of the flats being as promised and the marketing being effective. The occupancy rate will also be reviewed annually by the Board and adjustments made to the offer and/or the marketing as required.
Social Outcome 18 will take a while to get established – the nature of a small community is that it takes a while for new initiatives to become trusted and therefore embedded. We would expect to help 2 people a month in the first year, increasing to 5 per month by Year 5. This will be reviewed at the Community Engagement Officer’s annual review and steps taken to ensure that they are delivering a useful and relevant service.
Social Outcome 19 will be an expectation in the Community Engagement Officer’s Roles and Responsibilities, subject to annual review.
Social Outcome 20 will also take a while to get established, but with 1000 people in the village and surrounding area, we expect to have 15 households signed up for the oil co-operative and 5 for the wood-pellet co-operative by Year 3.
Social Outcome 21 will be achieved in partnership with the Glenkens Transport Initiative and the Connecting in Retirement project, who are aware of the people at risk of social isolation. By Year 2, we expect to deliver the service to 5 people a week on average over the year.
Social Outcomes 22-23 will be run and monitored by the Community Engagement Officer and reported to the Board.
All targets and actual figures will be reviewed by the Board at least annually and will be reported to the Members at the AGM, along with the financial data.
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5.3 Social Competitive Advantage A private owner who bought and renovated the shop, updated the product lines and service and increased the opening hours would expect to see a significant increase in turnover. In addition to this, we will exploit the social competitive advantage that comes with being a Community Shop to increase the turnover still further. By the time the shop re-opens, our publicity and the Share Offer will have significantly increased residents’ awareness of and loyalty to the shop. The marketing within the community will focus on an implicit ‘use it or lose it’ message and on the benefits of having a personal stake and influence in the future of the village. Because we are a member-owned, voluntary organisation in a small village, we have a lot of social and reputational capital, and the marketing will reflect this. We expect that a certain percentage of the population will use the shop even at slightly higher price-points because they are aware of the importance of its sustainability to the future of the village. We will increase the number of people who fall into this category through awareness-raising campaigns and on-going publicity.
5.4 Co-operative working with other small businesses At the same time, we do not want to come in with a modern new shop and use our grant funding and significant volunteer effort to devastate the competition in the village. Our vision is of a thriving local economy for all, which means that the small businesses must work together to create mutual advantage and avoid unnecessary competition. With this in mind, we will NOT be:
Running a café or selling freshly-made takeaway food in the shop – that would be inappropriate with 3 other cafés already in the village.
Selling gift or craft items in the shop – similarly because 2 of the cafés sell gifts.
Selling stationery, greetings cards or collecting dry-cleaning at the shop – this would take business from the Post Office.
Offering cash-back or a PayPoint machine – we want people to have to go into the Post Office for these services.
Advertising the shop widely outside of New Galloway village – we do not want to pull business from the neighbouring village shops, all of whom have been very supportive of our venture.
Recruiting volunteers heavily – available volunteers from the limited local pool should probably be supporting the CatStrand, which is unsustainable without volunteer support.
We have consulted with the other small business owners in the village and have agreed some ways in which we can mutually support each other:
Signage from the village car-park will not just be for the Community shop, but for the High Street, with a list of all businesses under it.
Where possible, deliveries / buying trips will be shared in order to reduce costs for all. This also extends to the neighbouring village shops.
Each business will be aware of the offerings of the others and will consciously signpost visitors in the right direction for their needs.
We will create and maintain a village-wide website, aimed largely at the tourist market, making it clear where to stay, eat and go out.
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5.5 The Post Office The status of the Post Office is of particular interest to the community, as a much-loved and always at-risk service within the village. Currently it is situated separately from the shop, a little distance away up the High Street. It is still a sub-post office (i.e. not a Post Office Local) and is therefore run by a salaried sub-Postmaster. During our community consultations, the most common question was whether the Post Office would be moving into the shop, as has happened in the neighbouring village of Dalry. People perceived this as a good way of assuring the future of the Post Office. Our initial expectation was that we would indeed move the PO into the shop, and the Postmaster was very happy to do this, on the basis of a retirement package being offered by the main Post Office. However, as time went on and the discussions progressed, it suddenly became apparent that the Post Office had changed the rules and that no retirement package would be forthcoming. In the light of this, and after detailed (and very cordial) discussions with the Postmaster, the following strategy has been agreed:
The PO will continue in its existing location as the Postmaster’s business, exactly as at present.
The renovation of the shop will be done with due regard to receiving a PO Local in due course.
In the mean time, the shop will not compete with the PO, and will in fact work together for mutual benefit as laid out above.
As and when the Postmaster decides to move on from the Post Office (which would ordinarily be a time of very high risk for the future of the service), the community shop will inform the main Post Office that they would like to take the service over, and would have an extremely good case for doing so.
In this way, we negate any possible financial loss to the Postmaster and also significantly reduce the risk of New Galloway losing its Post Office either now or in the future.
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6 Our Market 6.1 Stakeholder categorisation The following table gives a summary of our stakeholders, split into 7 main categories.
Category
Stakeholders
Customers of the shop People who need access to good value food within walking distance:
o Older or vulnerable people o Lower income households o Households without a car o People with caring responsibilities.
People who are interested in high quality local produce.
Residents who have run out of food basics (bread, milk etc).
Tourists who have holiday money to spend on local products and treats.
Customers of the self-catering flats Outdoor enthusiasts – Walkers, fishers, mountain bikers, astronomers, bird watchers.
Artists or people interested in the arts.
Older people
People with an existing connection to the area – visiting family and friends, re-living old haunts.
Families.
Users of the community services People suffering large life events and coming into contact with social services for the first time as a result.
o Bereavement o Divorce o Terminal/life-limiting prognosis of a family
member o Unemployment
People currently not accessing social services information about benefits or financial maximisation.
o Older people o Unemployed people
People looking to alleviate fuel poverty or simply economise through fuel-buying co-operatives.
People looking to feel more part of the community and reduce social isolation.
People wanting to start micro food businesses but put off by the barrier of red tape.
Funders who could support us Big Lottery ‘Growing Community Assets’ fund – First Stage Development funding awarded in February 2016, now applying for Second Stage funding for the full capital cost of the project and some operational costs. A decision is expected in late 2016.
Plunkett Foundation – a UK-wide network that supports Community Shops. Already given a small grant towards establishment and 7 days of mentoring time.
Community Shares Scotland – they have a bursary scheme for Share Offer launches which we will apply to for £5000 in the second half of 2016.
Galloway Glens Landscape Partnership Scheme – we have put an Expression of Interest into this local HLF-funded scheme for a further half-day a week of the Community Engagement Officer from years 4 &5. A decision on this funding will be known in mid 2017.
Share Offer – Planned for early 2017, after the BIG
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decision has been made, in order to provide absolute clarity on the message. See also ‘Members of our Society’ section below.
Note that because we are a BenCom not a charity, this removes the possibility of support from many other local funders, who only support charities. There are moves afoot to give BenComs charitable status, in which case more funding avenues will open up to us.
Members of our BenCom Existing members (81), who all have a single share in the company.
Future members through a Share Offer, to be launched in early 2017. People can buy any amount of shares from £10 to £10,000. They all then have one vote in the affairs of the society. We hope to raise £19,000 through our share offer.
Future members through ongoing recruitment – people can be part of the project at any time.
Neighbouring small businesses and charitable concerns Kitty’s Tea Room
The Town Hall
The Post Office
The Cross Keys Hotel
The Smithy Tea Room
The CatStrand Arts Centre
The Ken Bridge Hotel
Bed and breakfast / self-catering accommodation
Kells Primary School
Staff and volunteers Paid staff, full and part-time
Volunteers
Work-experience students
Associated people running micro-businesses (e.g. bike maintenance, home-baking).
Figure 12 – Table of Stakeholders
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6.2 Market Research
6.2.1 Shop
Our market research for the shop has focussed on village questionnaires and bench-marking from nearby and analogous shops. After two village-wide surveys in the initial phase of this project, we decided to use an alternative approach for the final phase:
We hosted targeted consultation sessions.
We attended a number of existing community group meetings that created access to relevant people for us.
We gave out questionnaires at each of these sessions, and left copies in the shop, Smithy and CatStrand.
We held a logo competition and brainstorming session in Kells Primary School (New Galloway) to engage the local children and through them their families.
Figure 13 – Results of brainstorming session on suggested stock with Kells School P1-P3s.
We created postcards of the schoolchildren’s logo designs, with information about the questionnaires and an update on the project on the back, and posted them through every door in the village.
We held one-to-one meetings with other third sector or public sector organisations that serve hard-to-reach individuals.
We discussed the issues informally around the village at all opportunities.
We carried out in-depth case studies of people with particular knowledge of, or particularly affected by, the issues of rural living.
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Results - Case Studies:
A big output from our community consultation was in the form of anecdotes and personal stories about what the shop means to individuals. We have summarised some key ones as Case Studies below.
Jim Hopkins, Existing Shop Owner.
There are many intangible benefits to a village shop. “A lot of my customers are elderly people living on
their own and, on many days, Marie [member of staff in the shop] or myself are the only persons with whom they will communicate. People also ring me ‘Have you seen so and so today?’ – ‘yes, she was in the shop 20 mins ago’ – ‘thank goodness!’.”
Another example on this vein is Jim checking-up on an elderly customer when he didn't see her. He phoned her, and she had fallen. “I had to break in through the window, got attacked by her dogs!”
The emphasis is on community shop: “In times of strife, we always stay open. During the heavy snow
in the '90s we drove out in the 4x4 to get staples like tins and powdered milk. We were mobbed in the street before we even got the goods back to the shop! And during the recent flooding, we drove miles roundabout to get supplies for people.”
“There have been many occasions when the shop has come to the rescue, particularly in times of
adverse weather or prolonged power cuts – who else stocks candles? We are also a focal point for finding out what is going on in the community and for single people to meet others and discuss the weather while getting their morning paper.”
Self-employed person, young family.
The greatest hurdles to finding work as a single parent in New Galloway are travel and childcare. “You
really need a car if you are trying to find work and have children. Public transport has very limited times, which just don't work if you need to co-ordinate with school/nursery drop-offs and pick-ups. A car is a large extra cost.”
"I haven't been able to find employment that fits around family since moving here a year ago, so I'm
about to become self-employed as a cleaner. If the shop could be used for a place to advertise and sell services through, that'd be ideal, and if it were able to offer more flexible part-time work or volunteering opportunities for young people or people like me who have been out of work and need to refresh skills and confidence, then I think that would be very important too. Not just retail but management or marketing or admin skills. You need a shop or something like it where everyone bumps into each other to feel part of the community."
Brian Jones, Connecting In Retirement, Glenkens Community & Arts Trust.
“You need to be the catalyst, but make things sustainable, getting key people involved so it keeps
going.” Working with community resilience – not only the kind where you prepare for floods or snow, but the kind that keeps communities healthy and happy; the kind that is actually the core of any strong community.
A shop offers space to talk. A place where friendships are generated, relationships built. A regular place
to go and know you can talk to someone, even if only for a few minutes. “Perhaps the shop project can facilitate a village car scheme, or a thrift club, or a Christmas savings
club – they used to be popular.” Brian agreed that a signposting service/information centre would be most useful, perhaps also combining an advocacy service with other services such as 'community guardians' in times of crisis.
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Single Mother, 5 children, looking to return to work. One of the most difficult things being a single parent of young children in this area is all the running
about you have to do when you have small children. It becomes really expensive [fuel costs, maintenance, road tax, mot] and time-consuming. If there was any way to provide affordable transport for families, or a way to access general services locally – perhaps an outreach service for elements of physiotherapy or dental check-ups.
Another problem for single parents is balancing getting back to work with childcare: “If there was
childcare after Nursery, I would be able to go back to work. Ideally, also an after-school club would be good for the girls. It's just so difficult otherwise to find work as it's a matter of fitting in travel-time getting to and from work, and the cost of travel, with the logistics of Nursery and school drop-offs and pick-ups”.
It would be great if there was potential to develop a bus/taxi service of some kind between Dalry and
New Galloway – a Nursery run to allow parents with no car, or those who would prefer a cheaper option, to get their child to and from Nursery.
“The shop really needs to be open longer hours (not just till 2pm as it is now) and to offer household
things like laundry powder and nappies, and affordable prices. It would be good if the shop had its alcohol licence back too.”
Man, 60+, lives alone. Has severe mobility difficulties. "I go to the shop every day. That's where I get my daily paper, and things like bread and milk." Although he can take the bus into Castle Douglas, he has extreme difficulty carrying shopping. Daily trips to the New Galloway shop allow him to buy a few things at a time. But the shop not only provides supplies: "I go to the shop for a chat and to hear what's going on. I don't know what would happen if we had no shop." Results – Questionnaires
Through the consultation, we also recovered 142 questionnaires, or around a third of the adult population of New Galloway, which is a good result considering that the same small community has been surveyed 3 times in 18 months about the same issue. The level compares favourably with the ~180 questionnaires recovered from the previous house-to-house surveys, and their contribution to community engagement is arguably higher because of the one-to-one discussion that accompanied their completion.
The full results and analysis of the survey is given in Appendix 5, but a summary is:
The top 5 requested stock lines were:
Everyday staples (81%)
Local produce e.g. cheese, honey, beer, chutney (72%)
Local seasonal fruit and vegetables (69%)
Fresh bread (65%)
Newspapers (58%)
This has informed our belief that we can make the shop into a viable commercial proposition by focussing on local produce as well as the everyday staples you would expect.
Interestingly, tobacco was the least requested item, but since this is also the lowest mark-up stock line, this won’t significantly impact the profit.
The top 5 services that people were interested in (excluding services offered by the Post Office) were:
Book swap (33%)
Laundrette (32%)
Surplus produce swap (30%)
Bottled gas (25%)
Oil buying co-operative (25%)
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This information has informed our decisions about what additional services to offer e.g. the conversion of the self-catering utility room into a communal laundry and the addition of an Oil Co-operative administration into the Community Engagement Officer’s Roles and Responsibilities.
It is important to note that none of these services are currently offered in the village, and so people are slightly unsure of what is being suggested. We would expect the uptake of these services to be higher than these numbers indicate by Year 3 of the project, when they have become established and word-of-mouth has spread.
We also discovered that every morning is likely to be the busiest time of the shop, information borne out by our full-day shop survey and discussion with the current owner. However, there is still a material requirement for the shop in afternoons and early evenings, both on weekdays and weekends. This has informed our final decision on opening hours.
Lastly, 70% of the population surveyed said that retention of the village shop was ‘Very important’ and an additional 24% said that it was ‘Important’. This 94% approval rating accords well with our previous survey findings and shows that the need and desire for the village shop is remaining constant through time. From this, we expect almost all of our residents to support the shop to some degree. We will engage with them through direct marketing around the village (flyers, posters, word of mouth). We will also use the contacts we make among the local food producers to spread the word about New Galloway shop becoming a centre for such produce. For example, Galloway Chillies has an excellent Twitter presence and has promised to promote us among their followers when we become stockists. We also carried out research via Board visits to other community shops, and we are grateful to the staff and committee members of the Carsphairn, Auchencairn and Palnackie shops for the insights they gave us. We also carried out a Plunkett mentored visit to Witherslack community shop in Cumbria.
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6.2.2 Self-catering flats The market for our self-catering accommodation falls into five main categories:
Outdoor enthusiasts – Walkers, fishers, mountain bikers, astronomers, bird watchers.
Artists or people interested in the arts.
Older people
Families
People with an existing connection to the area – Visiting family and friends, re-living old haunts.
6.2.2.1 Market trends in Dumfries and Galloway. A STEAM (Scottish Tourism Economic Activity Monitoring) report compiled for Dumfries and Galloway Council by Global Tourism Solutions in July 2015 showed that visitor spending in Dumfries and Galloway topped £300m in a year for the first time in 2014. The figures represent an increase of 4.2% compared with 2013.The study also showed that nearly two and a half million people visited the region in 2014 - a rise of 1.8% on the previous 12 months. According to the findings, there was also a "modest increase in employment" linked to the region's tourist sector, with 35 new jobs created during the year. The report presents good evidence that there is growth in the tourism market in Dumfries and Galloway and that there are opportunities to be taken advantage of.
6.2.2.2 Outdoor enthusiasts Statistics in Dumfries and Galloway point to a marked growth in short breaks, nature based and outdoor activity tourism in recent years4. A You Gov survey predicts that over the next three years there will be:
A 70% increase in participation in adventure travel nationally.
A doubling of participation in either ‘off the beaten track’ or special interest holidays.
A trebling in the number of people taking either an adventure, eco-friendly/ethical or ‘discovery’ holiday.
Walking is by far the most popular outdoors activity, with nearly 1.8 million trips per year. The second most popular activity is wildlife-watching, with well over a million trips, followed by adventure sports and mountain biking. This pattern is replicated in relation to visitor spend, with over half a billion pounds spent on walking activities or holidays, in comparison to £276 million for wildlife-watching activities and holidays5. New Galloway is well placed to capitalise on all these trends:
New Galloway sits within both the Dark Sky Park – the only one in the UK – and the UNESCO-designated Galloway and South Ayrshire Biosphere – again, the only one in the UK. These initiatives are being marketed well and are bringing in new visitors to the region. The accommodation will be marketed in publications specifically aimed at these enthusiasts, highlighting its modern, warm, comfortable appearance and its proximity to these sites.
New Galloway is 18-30 miles from Kirroughtree, Glen Trool, Ae and Dalbeattie – 4 of the 7 Staines mountain biking trail centre network, which is a well-established destination for mountain bikers. Again, the accommodation will be marketed in specialist publications, this time highlighting its drying room and bike storage area. Many mountain bikers now travel with their young families, making a village destination with pleasant accommodation a very attractive offer.
New Galloway is one of the stop-off locations for the Red Kite trail, a popular tourist route in summer.
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Loch Ken, which starts in New Galloway, is well known for its fishing and the New Galloway Angling Association hosts annual competitions which attract anglers from all over the UK.
New Galloway has a thriving Golf Club which is always most welcoming to new members and visitors.
The Galloway Activity Centre is 4 miles from New Galloway and offers a range of adventure and water sports. Its accommodation is usually over-subscribed, and New Galloway is well placed to take its over-spill, with the correct marketing and partnerships.
New Galloway is already a well-established destination for motor bikers taking advantage of the quiet scenic roads. By advertising in their specialist publications, we will encourage them to stay the night too.
Activity holidays are usually seen as a supplementary break rather than a main holiday, particularly by the domestic market. The ‘activity or adventure’ tourist is commonly perceived as young, independently wealthy individuals without family commitments. However research has found that the market for adventure sports span the majority of socio-economic groups, ages and genders. Adventure travellers are therefore equally likely to be single or married, and male or female.
Adventure travellers place a higher importance on exploring new places, enjoying nature and engaging with local cultures than other visitors.
37% of adventure travellers tend to travel as a couple, 25% travel in groups, whilst individuals make up 21% of the market, and families 17%.
Nearly a quarter of adventure travellers in Scotland spend around £70-£100 a day, including accommodation but excluding flights. The average trip lasts about a week5.
Our 4-bed / 2-bedroom apartments lend themselves equally well to family visits, visits by couples or friends and (if booked together) large groups of friends or family. Discussion with other local self-catering providers has shown a need for facilities for these larger groups.
6.2.2.3 The Arts Whilst the outdoor activity market will be a primary focus, New Galloway is also ideally placed to attract people interested in the Arts. With the CatStrand Arts Centre just 100m away from the shop, the village is already attracting such people, and events like the well-established Spring Fling bring yet more people into the region. We will offer short breaks designed to cater specifically for this market, forming partnerships with the CatStrand and local artists to offer the accommodation for workshops / classes. We will also capitalise on national themes to increase bookings; 2017 is Scotland’s Year of History, Heritage and Archaeology and 2018 is the Year of Young People. There are existing thriving local groups working in these areas that we will partner with in order to achieve this.
6.2.2.4 Older people and Families Although the adventure / nature based holiday is an expanding market, the older traveller should not be discounted. The slow pace of life in New Galloway and the beautiful natural surroundings, coupled with a wealth of accessible day trips make this a natural destination for older people and families. Accessible, modern, homely accommodation will encourage repeat business. We would use a niche resource such as the ‘Silver Travel Advisor’ to advertise our accommodation – a website containing travel reviews, information and advice specifically targeted at travellers aged over 50.
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VisitScotland surveys show that the average age of the older traveller to Scotland is 53, and that they are most likely to have come from elsewhere in Scotland, Lancashire, Yorkshire or Northern Ireland. Typically they:
Like the familiar and are risk averse
Buy and think local (newspapers, radio etc)
Are UK orientated but Scotland is their favourite destination and they know it well.
Prefer longer breaks / touring
Are loyal ambassadors (spend the highest number of nights in Scotland)
Come every year
Value good food / local produce / farmers’ markets
This all suggests that our self-catering accommodation in a village setting, as part of a community project, will appeal heavily to this demographic if marketed well.
6.2.2.5 People with family connections to the area We have an older population who enjoy visits from families but often lack the space to accommodate them or the energy to cope with young children all day. We will promote the self-catering accommodation locally as an ‘overspill’ option for families.
6.2.3 Community Engagement Officer
We fully understand the needs of our community from our 3 community consultations and these have led to the proposed creation of the Community Engagement Officer role. One case study in particular, from a recently bereaved older lady, said:
What is really needed is a personal connection. Someone consistent who knows who needs what and where everybody is in the village. “We need a map, showing where all the key people who need support are, along with details of where their family/close friends are and contact numbers.”
Some years ago there was a grant-funded post at the CatStrand of someone who worked with the
elderly and this was a great thing. The lady would visit all the elderly people, talk to them, work with them to find out what they needed. Unfortunately, as with all grant-funded posts, the money ran out so the person ended up leaving.
What would be ideal would be a post funded through the project that allowed someone local to be a
consistent point of contact for the elderly and vulnerable in the village, creating contacts between them and having a personal knowledge of who is where and needs what. “Someone people can turn to, just saying 'I feel awful, I want to cry'.”
An example of a situation that should easily be resolved is a local elderly man who's wife's vision is
failing. “He said to me ‘I would like someone to paint white lines on the steps.' And this should be something he can easily ask someone; not feel like he doesn't know where to turn.” The expected users of this service are given in detail in Section 6.1 and the community consultations are in effect the market research. Note that the services that the Community Engagement Officer provides will be free at the point of use, so classical business marketing research and planning is less applicable.
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7 Marketing Plan
7.1 Marketing – Shop
A large part of the marketing strategy for the shop in the pre-operational phase will be the Share Offer. As part of this, we will be explaining to residents and other interested people that this is an opportunity to invest in a business that will ensure that good value, good quality food and groceries will be available within New Galloway at hours that suit. Community Shares Scotland research shows that local shareholders become very committed to the cause they have invested in and are therefore more likely to regularly use the shop and support it through purchases.
During the operational phase, the marketing of the shop will be strongly, if subtly, linked to the other community services we offer. By offering either direct services based at the shop, such as the laundrette, bike hire or the surplus food swap, or indirect services administered from there (and branded as such), such as an oil buying cooperative, help with Environmental Health sign-off or advocacy support, the shop will become associated in residents’ minds as a Community Hub and somewhere worth popping in to. Even just extending the opening hours from the current 8am – 2pm hours will immediately make the shop much more relevant to many people’s lives.
We will of course continue our Facebook and website for the venture, but it is not expected that this will impact the business of the shop much. A village shop must play predominantly to its twin strengths of passing trade and repeat business from locals invested in its success.
7.1.1.1 Passing trade
New Galloway is not on a main road to anywhere, but it does benefit from hosting the CatStrand, a very appealing Arts venue. The tourist route over the Queensway to Newton Stewart, used by many as a scenic alternative to the main road, also passes through the north end of the village. Both are some 100m from the shop, and with strategic signage and support from CatStrand staff, many visitors will be encouraged to go and visit the local community shop. We will encourage the passing trade that we do get (workmen and tourists) by using:
Heritage paint colours on the window surrounds – the two multi-paned windows being an extremely attractive and distinctive feature of the shop.
Clear, branded signage making it clear it is a Community Shop.
New signage at the road entries to the village, pointing to the High Street and listing all the businesses that operate there, not only the Community Shop.
A modern, light interior with welcoming staff and attractive produce and stock displays.
Pavement signs advertising special offers, community benefits and local promotions.
Cooperative promotion, such as leaflets on display, with other local organisations.
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7.1.1.2 Logo We have deliberately followed a local and organic process for the creation of our logo. We first engaged the local primary school children in their ideas for a logo, which created many wild and wonderful ideas. We made up each one into an individual postcard, all of which were then used as another publicity campaign in a village-wide door-drop.
Figure 14 – Examples of postcards of school children’s work
Having very much enjoyed that process, we then commissioned a well-known local artist, Robin Ade, to capture two aspects of New Galloway, one of the High Street and one of the village from the park. We now expect to sell his beautiful pen and ink original drawings of the village in the Community Shop, either as prints or as postcards.
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Figure 15 – Line drawings of New Galloway
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We then commissioned a local graphic designer, Martha Schofield, to convert the design into electronic format, simplify it and add a modern font. The brief was the words ‘New Galloway’ over the top of a village image, with the words below changing for the different enterprises. We are delighted with the process and with the final outcome as shown below. Martha also created a ‘stamp’ image, bringing out just the iconic red kite, for use on smaller labels and merchandising. In this way, we have created a holistic brand for our enterprises that has been created by local people who love the area as much as we do.
Figure 16 – Final logos
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7.2 Marketing – Self-catering The strategy for the self-catering accommodation is a completely different proposition. Two options are open to us:
1. Create an in-house strategy and execution. 2. Contract out the marketing to an established self-catering holiday company.
The table below gives some examples of how such companies work, their reach and their fees.
Company Publicity Management Reach Fee structure Fee implication pa
Sykes Brochure, website, partner websites: Trip Advisor, Holiday Lettings
Manage bookings; Ensure payment collection; Pay monthly
26M hits on website annually. International coverage.
£120 set-up fee 20% on bookings Annual fee £80 per listing.
=(£21194*0.2) = £4239 Annual Total £4399
Air BnB
Website.
Guests book on the internet, host is emailed. Air BnB takes the money; pays you 24 hours after check-in.
2 million hosts world-wide, 60 million guests so far. People who have heard of it can find you easily; people not familiar with or confident in the technology may be put off.
Listing your space on Airbnb is free. Airbnb takes a 3% host service fee on each reservation.
=(£21194*0.03) = £636.
Discover Scotland
Brochure, website, office in Castle Douglas
Manage bookings; Ensure payment collection; Pay monthly
National (Scotland) coverage – well known locally.
£50 annual fee £400 advertising fee for both properties, 10% of bookings
=(21194*0.1) =2119 Annual total £2569
Figure 17 – Self-catering marketing options
We would initially go for the mid-range of these options – a well-known, classical model company such as DiscoverScotland.net. Based on 45% occupancy, the annual fee (10% booking plus annual fee) would be £2569. It is our view that we could not achieve the required level of professionalism in our marketing and bookings management for this price. Using an established company to manage this key aspect also lends credibility to our desire to manage a complicated tourist facility via a volunteer Board of Directors.
As we gain confidence in our internal management and gather significant repeat business, we may well consider moving to a more technology-based (and significantly cheaper) solution such as Air BnB, but this would be a Board decision for Year 3 or 4.
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7.3 Local Marketing – Shop, Services and Self-Catering Notwithstanding the use of an established company, we would also promote the shop and the self-catering accommodation ourselves. Local promotion would include:
Promotional flyers. For 500 folded flyers, the cost would be approximately £50
Social Media - via Facebook, Twitter and Instagram. Social media is an effective marketing tool to reach many users, including non-locals, for the self-catering apartments. Furthermore, it is free, unless users opt to advertise or promote their posts. Updates should be as frequent as possible, to keep visitors and potential visitors engaged.
Promotional Film. 5 minutes in length, in order to showcase the facilities of the shop and the accommodation. With digital technology so accessible, many online users expect to see quality photographs and films and can be put off from staying somewhere if there is a lack of good quality audio visual media online.
Local and Regional Newspapers Editorial and Advertisements - Galloway News, Galloway Gazette, Dumfries and Galloway Standard. In-house produced editorial, provided it is well crafted and coherent, incurs no cost from the newspaper and we would look to exploit this as much as possible.
Glenkens Gazette. One very local publication is the free bi-monthly newsletter, the Glenkens Gazette. NGCE has had an article in each edition since the start of the project, and we would continue to submit these. We would also have a standing 1/4 page advert in each edition, at £374 for the year.
Online Newsletters. These could be monthly or quarterly and would be for visitors and locals alike who sign up to the mailing list. The newsletters would consist of updates about the shop and self-catering businesses, information about services the Community Engagement Officer is offering and upcoming events, as well as information about the area, local news, editorials and advertisements.
Magazines. There are two local interest magazines published within the region, Dumfries and Galloway Life Magazine and Our Wigtownshire, which does occasionally include articles about Stewartry, which could prove useful tools for promoting the shop and self-catering flats.
Specialist Magazines and Web sites. Opportunities will arise with specialist magazines and web sites who are promoting an event in Dumfries and Galloway. For example the Ayrshire Fishing Guide Web Site promotes fishing across Ayrshire and Dumfries and Galloway, with features on Lochs, such as Loch Ken. The Links page is an ideal place to promote the self-catering.
WestSound Radio Advertisements. Prices range from £50 to £500 for 5 – 100 plays of a 40 second advert, including discounts for customers who opt for more plays. An additional £20 is applicable to create the advert, unless a readymade, broadcast quality advert is provided.
Website. The website would initially be created by a web design company, however its maintenance and updates would be carried out in-house. The website would be clean and clear and have an architecture that is simple and effective. It would encompass pages about the shop, the self-catering apartments and would perhaps have a page dedicated to local businesses and community groups, a blog/what’s on page and a contact us page. There would also be links to the existing Facebook and Twitter accounts, which would be essential to boost the website’s traffic and increase its reach. It would also link to other small businesses in the village, and be a valuable resource for visitors and locals alike.
Mutual Marketing. ‘You promote me, I promote you’ agreements with local businesses and community facilities. NGCE will be able to promote other projects and initiatives occurring locally to the customers of the shop, whilst other similar groups will be encouraged to direct people to the shop and other services provided by NGCE. Word of mouth is a driving force behind projects in small communities.
WGO Glenkens. A very local Facebook page with 301 Likes and up to 800 post Likes for popular posts. We have ready, free, access to use this site to promote specific events at the shop.
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7.4 VisitScotland There are many websites that offer marketing support for self-catering accommodation in Scotland. The most obvious is VisitScotland, whose web site receives in excess of 20 million hits every year.
7.4.1 VisitScotland Online
A web listing on visitscotland.com provides a platform for tourism businesses to promote their services, increase product awareness and drive sales. The VisitScotland Extranet (online management system) also provides comprehensive reports on web listing performance. VisitScotland work with partners they refer to as booking engines, and we would expect the booking company we choose to be one of their partners. Their online system is not ideal at present, but it is a well-known brand and one we should be part of.
7.4.2 VisitScotland Information Centres These centres are located in Kirkcudbright, Castle Douglas, Dumfries, Gretna and Stranraer. There are multiple opportunities to advertise businesses across the Information Centre network in Dumfries and Galloway. It’s an excellent opportunity to showcase businesses to a receptive audience of tourists, day trippers and locals. Most of the marketing opportunities can be tailored to suit the individual business and budget, which will enable us to promote products and services to visitors looking for inspiration on where to go and where to stay. To provide guaranteed racking for flyers in all Dumfries and Galloway VisitScotland Tourist Information Points, a web listing and ¼ page advert in “What to See and Do in Dumfries and Galloway” publication guide will cost in the region of £1422 annually.
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8 People
8.1 Management and Board structure
The current Development Phase, the coming Renovation Phase and the final Operational Phase will be managed through New Galloway Community Enterprises Ltd. There is currently a volunteer management committee of 7, comprising a broad spectrum of skills and experiences to drive this project forward. Mike Brown (Chair) retired in 2010 from a long career in communications having held senior positions in journalism (print media and radio) and public relations (Higher Education and Third Sector). He therefore has a comprehensive understanding of the needs and processes of communicating with the project's various audiences. He has been a Trustee of the John Muir Trust (a conservation charity) and is familiar with the governance issues arising in pursuing a vision while also meeting financial and legal responsibilities in running a membership organization, employing staff and mobilising volunteers. He has extensive experience in the Quaker technique of consensual decision-making and believes in a collegiate approach to ensure all voices are heard and clear and that agreed policies are produced and implemented. Mike moved to New Galloway eight years ago but already had long-standing family connections in the area, which he knows well. He is a volunteer driver with Foodtrain, a charity delivering shopping to remote and housebound people, a service which is as much about combating loneliness as supplying groceries. He is also a volunteer in several capacities with the CatStrand Arts Centre, including convening The Glenkens Story history group, part of Connecting in Retirement, a project specifically designed to combat rural isolation. Sarah Parry (Vice-Chair) is a social scientist, who has worked at the University of Edinburgh for 13 years. She has researched, taught and practiced public engagement since the early 2000s - particularly working with marginalised and disenfranchised communities regarding controversial public policy topics. Sarah's work has included obtaining funding for and running large research projects and providing advice to those working in public policy. Now living in New Galloway with her partner and child since 2012, Sarah is an active member of the local community, with a particular interest in social and environmental issues. Dawn Spernagel (Treasurer) is a local entrepreneur and active community volunteer. She started a micro-food business in New Galloway in 2012, creating high-quality frozen meals, soups and puddings for sale in the local area. Since then, Love to Eat has secured a contract to stock the freezers of a large local employer and has expanded into fresh food provision. Dawn is passionate about high quality, local food and also about supporting her community. She has lived in New Galloway for 12 years, during which time she has brought up her family of 4 young children while volunteering for a variety of local charitable organisations, mostly as an office bearer on the committees as well as providing practical support. Margaret Watson (Secretary) was brought up in New Galloway parish and has spent the majority of her working life living in the area with her family. As a Sector Manager within Scottish Enterprise for over 10 years she has extensive experience in supporting business and economic development in a wide range of industries. As a Chartered Surveyor her previous job involved the day to day management of a large local rural estate extending to over 4000 hectares incorporating farms, commercial forestry, hydro electricity schemes, sawmill, rental properties and field sports. Having been chair of the New Galloway and Kells Community council for over 10 years, she has a comprehensive understanding of the local community and its residents. She sits on the Board of two local charitable organisations ( GCAT and Abbeyfield Stewartry) and is a regular volunteer for a number of other organisations.
David Briggs and his wife Marion own and operate The Smithy, a very popular Tearoom and Gift Shop in New Galloway. They moved to the area in 2009 after previous experience running their own Hospitality businesses in Largs(Hotel) and Folkestone(Restaurant). David is very experienced in the detail of creating and maintaining small rural businesses, as well as being a chef with a keen interest in local, high quality food suppliers. David is also very committed to the local community - he and Marion raise money for local causes though plant sales, and the Tearoom is at the heart of all New Galloway community days. He brings a real understanding and experience of the pitfalls and pleasures of running a local business within a remote-rural community.
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Emma Harnett works as a Production Manager in the BBC factual unit, managing complex productions in a high pressured environment. Having worked in the television industry for over 16 years, Emma has developed skills in business management, finance, scheduling, systems and protocols and team management which are very transferable into other sectors. In addition, Emma has experience of property renovation, having successfully renovated a large country home into 2 homes and with plans for holiday units. This required a robust business plan which Emma developed along with her husband. In her youth, Emma gained experience of working in a variety of retail outlets, enhancing her skills in this area. Having been in the community for over 3 years, Emma and her family have firmly ensconced themselves in the community and various activities and groups in the area.
Mary Smith has a degree in community development and extensive experience working with people who are vulnerable, isolated or marginalised in rural and semi-rural areas. This includes support and advocacy for young adults and older adults experiencing mental ill-health, young people coming out of care and the LGBT community in the voluntary sector, as well as working for the local authority in adult literacy and numeracy and community education and engagement. She moved back to New Galloway a year ago as a newly single parent and so also contributes her first-hand experience of the challenges of living on a low income and finding work in this community.
Additionally, paid professional support has been retained, enabling the strategic vision and local knowledge of the Board, to be delivered and realised.
Project Manager – Helen Keron
Helen was the Chair of this project and led the Board in successfully applying for development funding, before applying for the job of local Project Manager. After an externally-led interview process, she was awarded the job and hence resigned as Chair. Helen has 13 years of project management experience in the oil industry, with her last role being Project Manager for 2 consecutive £10million annual maintenance shutdown workscopes on a Southern North Sea gas platform. Since leaving that role to start her family, she has spent 5 years as a community volunteer and is now considered a community influencer in the Glenkens. She started a rural playgroup, project managed the purchase of a community centre from the Council for £1 and is a Board member of 2 local charities and a member of 2 Community Councils. She is about to embark on an Open University course ‘Rural Entrepreneurship in Scotland’.
Development Consultants – Creetown Initiative Andrew Ward and Creetown Initiative have a 27-year track record of delivering projects for Galloway communities. They are currently overseeing the delivery of the Creetown Community Enterprise Centre, funded by a successful GCA application in June 2015.
Architect – Marc Henkelmann Marc is a local architect based in Kirkcudbright with 20 years’ experience of new-build and renovation projects. He has a MA equivalent in Civil Engineering from the University of Stuttgart, Germany, is a Member of the Chartered Institute of Building and is a Chartered Construction Manager. He has been providing architectural and project management services in the local area for the last 12 years. He has excellent references which centre on his pragmatic but creative approach.
Communications Assistant – Sarah Ade. Sarah lives in the neighbouring village of Dalry and has an extensive network of contacts in the area. She is experienced in website creation and the use of social and print media.
Managing the project into the long term and ensuring that it is meeting all of its objectives will be crucial. The overall management of the project, grant management, staff management and other administration will be the responsibility of the voluntary NGCE board of directors. Clearly some paid staff will be required to implement our vision, and as many of these as possible will be taken on as employees of NGCE. The NI and pension liabilities that this implies are outweighed by the loyalty this will bring and the capacity building it will allow. See Section 9: Organisational Structure for more details.
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8.2 Employees - Shop
The shop will be open from 8am until 6pm Monday to Thursday and Saturdays, 8am until 7pm on Fridays and 8am to 4pm on Sundays. This represents a 76 hour working week. Therefore the shop will require 2.1 full-time equivalent (FTE) posts to staff it, to also allow for a half-hour newspaper organisation at the start of each day, buying trips and administration. This will be filled by a full-time Shop Manager and up to 3 part-time Shop Assistants. The Shop Manager will be paid £10.50/hour and the Assistants £7.50/hr. This is in-line with local expectations and benchmarks. The cost of this, plus employer pension and NI contributions will be £24,171 for the Manager and £18.074 for the Assistants, or £42,246 in total in Year 1. See Section 11.2 for more details of how this is calculated.
8.3 Employees – Community Engagement Officer The Community Engagement Officer will co-ordinate the social well-being services that will meet the further needs of the community. This will initially be a 16hr/wk post, increasing to 20hr/wk in Years 4 and 5 if additional funding submissions are successful. This is a skilled role and will be paid at £15/hr. Allowing for NI and pension, this will cost £13,457 pa in Year 1.
8.3 Employees – Self-catering flats
The self-catering flats will require a housekeeper / cleaner (who will also clean the shop) and a gardener. The gardener will average 1.5 hours a week on a self-employed basis, and at £9/hr, will cost £702 pa. The housekeeper will spend 1.5 hours a week cleaning the shop and 3 hours per let on housekeeping / laundry / cleaning for the flats. Using the assumptions about letting levels shown in Section 11.3, this corresponds to 144 hours a year. Adding in the regular cleaning at 78 hours a year at £8.50/hr gives an annual wage bill of £1,887.
8.4 Staff Management
The Shop Manager and the Community Engagement Officer will be peers and will report independently
to the Board of Directors. This will be done by personal or written report at the 2-monthly Board meetings.
The Chair of the Board (who will by definition live in the village or parish of New Galloway) will also discuss any strategic and operational concerns of the staff on a more informal basis monthly – this is a model that already works well for a neighbouring charity, the Glenkens Community and Arts Trust.
All staff will have written Roles and Responsibilities as well as a contract of employment. These will be discussed at the start of each tenure and at yearly Performance Reviews.
The Shop Manager and Community Engagement Officer will have their yearly reviews with the Chair of the Board, with Board and/or external support as required; the Shop Assistants will have theirs with the Shop Manager.
Targets for the next year will be set at each annual performance review, and delivery against previous targets assessed. This will form the basis for any salary increases. We may in time use a performance-related annual bonus model for the Shop Manager and Assistants, if we believe that would enhance performance.
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8.5 Enterprise Policies The following policies will be put in place prior to business start-up. We will engage a professional HR company on a year’s retainer in order to ensure that they are all of a high standard and compliant with all relevant legislation.
Human Resources: o Staff management o Volunteer management o Work experience placement management o Complaints procedure o Disciplinary procedure o Development / training
Staff handbook o Induction training o Customer Service o Procedure manuals
Operational procedures
Financial Management
Health and Safety Policies
o Display a current Employers’ Liability insurance certificate o Provide employees with ‘Your Health & Safety’ - a guide for workers o Record and report as necessary any injuries and accidents. o Undertake risk assessments. o Consult employees on Health and Safety matters o Provide Health and Safety training for employees
Communications o Marketing o Advertising o Community relations o Promotions
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9 The Organisation
9.1 Organisational Structures The two phases following this Development Phase will have quite different organisational structures.
Figure 18 – Renovation Phase Organisational diagram
In the Renovation Phase, the Project Manager will co-ordinate the work, initially on a 24 hr/wk basis. She will report to a sub-committee of the Board, comprising 2 or 3 Directors, in order to allow responsive but assured decision making. The Project Manager will liaise closely with the Architect, who will be responsible for the delivery of the construction contracts. The QS will create the Bill of Quantities, issue tender documents and review invoices against costs. At the same time, and working in co-ordination with the main contractors, the heating system will be installed; damp treatment undertaken and the garden will be smartened up. When the renovations are complete, an Interior Designer will specify the soft furnishings of the flats. From the point of purchase, preparations for the renovation will take 16 weeks, during which time it will run in a broadly similar format to today, albeit with longer opening hours and additional staff. The shop will then shut for 5 weeks, during which time it will be run from the Lower Town Hall. The house renovation will take a further 5 months before the self-catering accommodation can be rented out.
Board of Directors
Sub-committee
Interior Designer
Project Manager
Main Construction
Contractor
Gardener
Architect
Biomass Heating Contractor
Other trades
Plumber
Electrician
Joiner Volunteers
Contractors / Consultants
New Galloway Community Enterprises
Renovation Phase
Organisation diagram
Structural Engineer
Quantity Surveyor
Damp remediation
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Board of Directors
Volunteers
Shop Manager
Shop Assistants
Work
Experience
Community Engagement
Officer
New Galloway
Community Enterprises
Operational Phase
Organisation diagram
HR Support
Gardener
Cleaner /
Housekeeper
Volunteers
Contractors /
Consultants
NGCE
Employees
Figure 19 – Operational Phase Organisational diagram
The Operational phase of the shop will be managed into the medium and long term as per the structure shown above in Figure 19.
The voluntary Board of Directors will continue to provide strategic oversight and governance for NGCE.
The full-time Shop Manager will manage the shop and associated staff / volunteers on a day-to-day basis and will report directly to the Board of Directors.
The Community Engagement Officer will also report directly the Board. While they will be required to work in close partnership, the roles and responsibilities of the Shop Manager and Community Engagement Officer are quite distinct and they both need to report to the board for their annual reviews.
Accountancy support for payroll, VAT returns and annual account submission will be outsourced to a reputable local company with experience of working with village shops. HR support will be provided by a professional HR company such as HRDept.co.uk or Citation.co.uk (both recommended).
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9.2 Board Protocols The Board will meet every 2 months to discuss:
Financial performance of both the shop and the self-catering accommodation. Review against annual targets.
Any high-level operational issues
The work of the Community Engagement Officer against set targets.
Whether NGCE is effectively meeting the needs of the community.
Partnership working with local businesses and charitable concerns – ongoing and opportunities.
The ongoing grant-disbursement process via the Grant Allocation sub-committee.
Review of the risk register.
Medium to long-term strategic plan.
The expectation is that each voluntary Director will serve for 3 years. During the first three years, we will actively recruit more Directors, so that we can ‘retire’ some founder members early and get ourselves into the required routine. A good number of Directors would be 9, with 3 joining and leaving each year. The Chair will typically be drawn from someone in their second or third year of tenure. Directors may stand for re-election but may not be elected more than twice consecutively. This will ensure continuity in strategic vision, while preventing fatigue and allowing fresh ideas and enthusiasm into the organisation. An ‘Audit and Finance’ sub-committee will be created, which will meet 2-monthly, approximately 2 weeks before the Board meeting, so that up-to-date figures are available to the Board. Their role will be to scrutinise the financial figures in some detail and to provide assurance to the Board that all is as it should be. A ‘Grant Allocation’ sub-committee will also be created and refreshed annually at the AGM. This is in order to engage our membership in the long-term aims of the organisation. It will be drawn from the members (including 1 or 2 Directors) and will be the body that decides on the individual grant allocations, in line with the overall strategy agreed at the AGM. We expect seats on this sub-committee to be popular, and a secondary purpose of it would be to identify and recruit new Directors, in line with our renewal policy. This committee would meet 6-weekly in order to ensure a rapid turnaround on grant decisions for the community. We will use Sage or equivalent (such as Cashflow Manager) to monitor our finances and to manage payroll, and will retain Chartered Accountants to audit the accounts.
9.3 AGM / Member engagement
The first AGM of NGCE Ltd was held on the 3rd November 2016, after our first financial year ended in September 2016. It will thereafter be held annually on or around that date. Accounts will be created and audited if necessary for that date such that they can be submitted to our members for review and to our registration body, the FCA. At each AGM, the Board will report back to the Members on the funds disbursed that year and what they have achieved in the community. The Board will also present a number of strategic options for funding in the coming year, such that Members can discuss the options and set the agenda for the Board to execute in the coming year. In this way, we would expect to encourage high attendance by Members at the AGM, and to reinforce at least yearly the community-run nature of the organisation. This in turn should lead to a willing pool of volunteers to serve as Directors.
Separately from the AGM, we will also hold a yearly event for staff, directors, volunteers and members. This will have two aims:
Allowing the membership to contribute to the strategic direction of the company, thereby ensuring we stay in touch with our grass-roots needs.
Bringing the team together in an informal setting to have some fun and get to know each other.
So it might typically be a two-hour brainstorming session, followed by a barbeque or a curry night.
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10 Partnership working
Partnership working has been central to the project ethos from the start, both as a means of accessing expertise and of integrating the community shop project symbiotically with the wider New Galloway community.
Partners include agencies with specific remits to support projects such as ours, as well as groups identified in response to the Needs Survey and other consultations. A number of potential partners have supplied letters of support (Appendix 15) Our principal community and third sector partners are listed below. We will also partner with commercial organisations such as suppliers and food producers as well as engaging professional expertise - accountancy, HR, marketing, etc.
10.1 Plunkett Foundation
The Plunkett Foundation is a national network that supports community enterprises all over the UK. We engaged with Plunkett from the start and received grant funding and mentoring support including a mentored visit to Witherslack Community Shop and many learning resources on starting and operating a community shop. We look forward to continuing this relationship as the Community Shop becomes a reality.
10.2 Community Shares Scotland.
Community Shares Scotland supports BenComs across Scotland to research, develop and deliver Share Offers in order to fund community projects. They have already provided advice in planning the Share Offer and delivered a positive response to our business plan. We will work closely to create the Share Offer documentation with the aim of receiving their ‘CSS Standard Mark’ that assures investors that this is a valid investment.
10.3 New Galloway and Kells Community Council New Galloway & Kells Community Council have been regularly updated on progress and have minuted their support for the project. The proposed Community Engagement Officer has the potential to facilitate relevant Community Council projects which require more than volunteer effort.
10.4 Glenkens Community and Arts Trust GCAT owns and operates the CatStrand arts centre in New Galloway, as well as other outreach projects in the wider region. Excellent relations are maintained with GCAT, with some overlapping Board membership. Mutual support will be developed while avoiding duplication of activities or commercial competition.
10.5 Glenkens Transport Initiative. GTI is a GCAT project that provides limited additional public transport services locally, as well as hiring minibuses and drivers to facilitate community events and activities. With our Needs Survey clearly indicating the importance of Public Transport, we will work with GTI to explore opportunities for cross-funding and joint working.
10.6 Local Initiatives in New Galloway (LING), including New Galloway Town Hall committee. LING and the Town Hall committee are dedicated to saving New Galloway's historic Town Hall. We have good relationships with both bodies and are identifying opportunities for joint action. The Town Hall is an obvious potential venue for drop-in clinics and other activities organised by the Community Engagement Officer.
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10.7 New Galloway Post Office and other local businesses.
As discussed in sections 5.4 and 5.5, co-operative working with other businesses will be of critical importance to the success of our scheme. Mutual co-operation and support will lead to an increase in the overall viability of New Galloway’s economy, which will be good for all.
10.8 Kells Primary School, New Galloway NGCE Board members have very much enjoyed the consultation work done with the primary school pupils to date, and expect to continue this link between the school and the community projects into the future.
10.9 Dalry High School
Discussions with the Acting Head for the Glenkens Cluster Schools, Mrs Jenny Smith, have suggested that work experience placements in the shop would be extremely valuable for those students hoping to gain their SCQF level 3 & 4 Employability Award qualifications at the high school.
10.10 Third Sector Dumfries and Galloway NGCE is in the process of becoming a member of TSDG, and will use the Third Sector Interface’s networks and experience to enhance its community offerings.
10.11 DGC Business Gateway We have been in discussion with Business Gateway Dumfries and Galloway to explore the support services they can offer us in setting up the business, in particular around matter of marketing, social media and increasing footfall. .
10.12 DGC Community Resilience team
The Community Resilience Advisor in the Dumfries and Galloway Council Community Resilience team is extremely positive about the contribution the Community Engagement Officer role would make to New Galloway’s community resilience planning for extreme weather or other emergency situations. He would offer free training for the person in role and further development of the existing NG Community Resilience Plan, to include the CEO role and the community refuge aspect of the project.
10.13 DGC Financial Maximisation Team.
The Dumfries and Galloway Council Financial Maximisation team have indicated that they would be very interested in coming to New Galloway on a 2-monthly basis to host drop-in clinics. They would focus on ensuring that everyone understands what they are entitled to in the way of benefits, and supporting them in obtaining such benefits as necessary.
10.14 Stewartry Health and Social Care Integration project We are in discussion with Sharon Walker, the Public Health Practitioner who is the lead on Health and Wellbeing within the Stewartry Integration team, about the possibilities of the Community Engagement Officer role becoming a pilot project for the Integration programme. The role fits extremely well with the Integration of Health and Social Services agenda. If it is selected as a pilot project, this would offer enhanced monitoring and evaluation of the impact of the role, as well as further opportunities for partnership working as the Integration team define their future plans for building community capacity and supporting communities to care for their own.
10.15 Development Trusts Association Scotland.
DTAS administers Oil Buying co-operatives across Scotland and the Community Engagement Officer would partner with them to get our scheme up and running.
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11 Operational Plan
11.1 Shop products and mark-up In the present shop, the reduced opening hours and lower stock levels and range have had a dramatic impact on turnover (20% drop in 4 years). As such, increasing turnover significantly by simply increasing opening hours, stock levels and choice of stock is realistic and would be the first step to returning the business to a sustainable model. At present the shop opens 8am – 2pm Monday to Saturday, 8am - 1pm Sunday. This equates to the shop turning over £57 per hour. Evidence from other similar businesses suggests that afternoons are much quieter but that there is an up-lift in sales when school children and workers return home. New Galloway is a place that attracts visitors, and through the summer there is a significant boost in sales. It is important also to understand the link between services and tourism. If a town or village cannot offer the basics of a shop, post office, fuel, accommodation and such, then visitors will simply pass through. Opening hours are very important, and convenience should be centred on the customer. So it is realistic to suggest that opening in the afternoons will improve turnover, especially during the holiday season. The results will be slow at first, but as people start to get the message that the shop is open, things will improve and sales will grow. Product mix and price mark-up is crucial in-terms of the shop’s profitability. How stock is purchased is particularly important. Joining a buying group such as Spar or Today would give access to higher margins through lower costs, but would restrict the stock range to the specific buying group’s preferences. Local options are few, with Bookers being the only realistic nearby wholesaler. Bookers are the current suppliers. Because of this, it has been determined that the shop should own its own vehicle, to allow efficient stocking-up from wholesalers by the Shop Manager in person. This offers two advantages over online wholesale purchasing: It will allow relevant promotions offered by each wholesaler to be noticed and taken advantage of. It will also ensure the freshest fruit and vegetables can be chosen, in order to ensure that they can be sold on successfully. In the light of our project’s ethos, and with free charging points available in the village and wider region, an electric van will be purchased. For details, see Appendix 6. Creating the right product mix is important and promoting the high mark-up lines is vital. As the table below illustrates, sales of tobacco produces a negligible profit. The following tables give a guide to the product mix and sales levels we will aim to achieve. Predicted Product Mix (Year one) based on £3064 average sales per week. Overall Mark-up 20%:
Weekly Sales, Year One
Actual Sales
% of Sales
% Mark-up
Purchase price
Net Profit
Newspapers and Magazines
800 26 25 640 160
Tobacco 500 16 4 481 19
Wine, Spirits and Beers 400 13 30 308 92
Groceries 964 31 17 824 140
Hardware Items 300 10 25 240 60
Toys and Gifts 100 3 20 83 17
0
Total / Average £3,064 100 20 £2,576 £488
Figure 20 – Predicted Gross Weekly Profit, Year 1
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Assuming an increase in turnover and also an increase in mark-up, by Year 5, the profit will be greatly enhanced: Predicted Product Mix (Year five) based on an increase in sales over 5 years to a locally bench-marked weekly turnover of £5,000 and an increase in overall mark-up to 27%:
Weekly Sales, Year Five
Actual Sales
% of Sales
% Mark-up
Purchase price
Net Profit
Newspapers and Magazines
1032 21 25 826 206
Tobacco 500 10 3 485 15
Wine, Spirits and Beers 1084 22 36 797 287
Groceries 1620 32 25 1296 324
Hardware Items 605 12 35 448 157
Toys and Gifts 160 3 35 119 41
0
Total / Average £5,001 100 27 £3,971 £1,030
Figure 21 – Predicted Gross Weekly Profit, Year 5
Apart from increasing sales, it is critical that gross margins are increased. The introduction of Wines and Spirits, Non-Food and Hardware items will help this and a target of 27% mark-up overall is realistic (benchmarked to a neighbouring shop). The other assumptions behind the increasing mark-up are that we will get better at running a shop, and by Year 5 will have fully optimised our supply chain and understood our stocking strategy. The use of an EPOS (electronic point of sale) integrated till system allows detailed analysis of turnover, mark-up and timescales by individual product lines, and this will be our main tool for increasing effective mark-up. Figure 22 shows the sensitivity of the 5 year annual profit to single percentage points of mark-up and shows the crucial importance of maintaining focus on overall mark-up levels. A drop in 1% corresponds to a loss in gross profit of £1,435.
Per % mark-up (Year Five turnover)
£1,435 per % point
12.0 12.0 12.0 12.0 12.0
Mark-up 29 28 27 26 25
Total income £293,525 £293,694 £293,866 £294,041 £294,218
Total expenditure £288,473 £290,055 £291,661 £293,294 £294,952
£5,052 £3,640 £2,205 £747 -£734
Figure 22 – Mark-up sensitivities
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11.1.1 Worst credible case scenario.
Figure 23 shows the worst credible case scenario, where mark-up is slower to reach 27% and turnover only increases by 15, 10, 10, 10, 10% over the 5 years, instead of 30, 20, 15, 10, 7.5%. As can be seen, this has a catastrophic impact on the profitability of the shop. It is important to note however that these are the assumptions on which the operational subsidy from the Big Lottery has been requested. Thus if we are successful in our grant application, the shop will turn a small profit even in this worst-case scenario. It is important to note here that this is a model constructed to assess the required level of operational grant funding. Were the shop to perform in this way, as opposed to meeting its target levels, the Board would use its review protocols as set out in Section 9.2 to identify the issue early on and take remedial action. Options available to the Board are in this case are set out in Section 13.10, Contingencies. Year 1 (15%
increase) Year 2 (10% increase)
Year 3 (10% increase)
Year 4 (10% increase)
Year 5 (10% increase)
INCOME
Total income £154,977 £172,897 £192,203 £213,023 £235,647
OUTGOINGS
Total expenditure £185,749 £201,170 £216,221 £230,728 £246,209
Shop Profit, net of VAT -£30,772 -£28,273 -£24,017 -£17,706 -£10,562
Figure 23 – Worst credible case scenario
11.2 Shop staffing
The shop will be staffed by a full-time Shop Manager, working a Monday to Friday week, supported by up to three part-time Shop Assistants. There will be two people on shift in the busy early-morning hour, and for half an hour before opening, and then one person only at other times. In addition, the Shop Manager has extra hours allocated on Monday afternoons for stocking and Friday afternoons for administration. Note that the incumbent Shop Assistant will be offered one of the 3 Shop Assistant roles, as required under TUPE regulations. Staff numbers in shop Mon Tues Wed Thur Fri Sat Sun
7:30am 1 1 1 1 1 1 1
8am 2 2 2 2 2 1 1
9am 1 1 1 1 1 1 1
10am 1 1 1 1 1 1 1
11am 1 1 1 1 1 1 1
12 mid day 1 1 1 1 1 1 1
1pm 1 1 1 1 1 1 1
2pm 1 1 1 1 1 1 1
3pm 2 1 1 1 2 1 1
4pm 2 1 1 1 2 1
5pm 2 1 1 1 1 1
6pm 1
Figure 24 – Shop staffing levels
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11.3 Transition into Community Ownership
There are two periods of transition in the process of ownership and renovation that will need to be managed with extra care:
From point of purchase to start of shop renovation
From start to end of shop renovation. To start of renovation (~5 months)
Shop Manager and new Shop Assistants will have been recruited to start on Day One in the existing shop set-up.
Buildings insurance, employer’s liability insurance, public liability insurance, business interruption insurance and public performance licence will be in place.
Existing supplier contracts will be handed over to NGCE.
The shop will continue very much as at present, albeit with extended opening hours.
The stock will be renewed as per existing policies.
The new staff will closely observe the existing system and feedback to the Board about ideas for improvement in the new shop.
New fixtures and fittings, EOPS till system will be ordered for delivery as required.
Communication about the timeline to the upcoming shop closure will be clear and regularly updated. To end of renovation (~5 weeks)
The shop will relocate to the Lower Town Hall, some 50m from the existing site and still very much in the centre of the village. This will require a volunteer effort one weekend.
Milk, papers, bread and as much other stock as possible will be sold from the temporary premises.
The new Shop Manager and all Assistants will move with the shop.
Communication about the timeline to the renovated shop opening will be clear and regularly updated.
11.4 Tips to encourage increased sales.
These were taken from ‘How2 Create a Community Shop and Post Office’ publication by the Oxfordshire Rural Communities Council, 2010. The following ideas will be incorporated into our final shop layout and procedures:
Make aisles wide enough to accommodate prams and wheelchairs and keep clear at all times
The central shelving should be at a height that can be seen over, wall shelving should be higher
Create clear sight lines from the till, particularly to the door. Use mirrors if necessary so that as much of the shop can be seen as possible from the counter
Lighting should be bright and uniform throughout the store. Good lighting at the counter is important.
Position chillers, freezers and perishable goods out of direct sunlight. Be aware that sunlight can fade packaging even if the goods are not light sensitive
Products should follow a logical pattern and be displayed in vertical block sections e.g. pasta and rice, soups, tinned vegetables, tinned fruit and desserts, baking products, beverages, biscuits, cakes, cereals, pet foods, household goods, etc.
Position confectionery, ice cream and snack lines near the counter to encourage impulse buys
High value goods and age restricted goods such as spirits, cigarettes, medicines and batteries, should be placed behind the counter
The off-licence section should be positioned adjacent to the counter for security reasons
Know where the ‘hot spots’ are (usually on or near the counter) and use them to promote new lines or seasonal/celebratory goods
Display best sellers at eye level: “Eye Level is Buy Level”
Use ‘point of sale’ material to highlight special offers and specialist lines
The image of the store from outside is as important as the view inside
How the shop looks and the atmosphere within the store are both vital factors.
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11.5 Roles and Responsibilities.
The Shop Manager’s key duties will include:
The Shop Assistants’ key duties will include:
1 Staff Rotas 1 Serving Customers
2 Staff Welfare/HR 2 Taking and preparing orders
3 Stock Control and Ordering 3 Pricing stock correctly/stock replenishment/stock rotation
4 Marketing and Promotion 4 Door to door deliveries
5 Staff Training 5 Maintaining the shop/cleanliness
6 Health and Safety compliance 6 Maintain safety around the shop, remove/manage any trip or slip hazards or anything else that could cause accidents
7 Weights and Measures 7 Be trained in basic first aid
8 Maintaining accurate accounts, keeping all relevant records.
8 Be trained how to lift correctly
9 Complying with all relevant legislation and displaying posters/certificates as necessary.
9 Maintain all signage. Making sure it is up to date.
10 Making sure that all relevant insurances are up to date
10 Control and management of all waste and refuse
11 Managing accident report book 11 Daily monitoring and recording of fridge and freezer temperatures.
12 Carry out any relevant risk assessment
12 Receiving and promptly storing deliveries.
13 Maintain and manage shop computer systems
13 Report to the Shop Manager.
14 Manage all fire safety equipment and means of escape
15 Management of company vehicles
16 Management of all shop machinery
17 Management of shop security
18 Volunteers
19 Alcohol licensee
20 Liaising with local producers
21 Accommodation booking / managing housekeeper
22 Report to the Chair of the Board
23 Paying suppliers
Figure 25 – Staff roles and responsibilities
Notes on Shop Manager’s duties:
1. Making sure staff cover is well managed and staff know their rotas in good time. 2. Managing all staff welfare and HR issues, including annual staff reviews. The manager’s
responsibilities will include staff day-to-day performance, appearance, health and welfare. 3. Manage all stock control procedures. EPOS system as well as manual systems. 4. Marketing and Promotion. An initial marketing budget of £2000 has been allocated. This
budget will cover Web Site, Social Media, local postering/flyers, in-store promotions and promotional work involving local suppliers.
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5. Staff Training will cover all aspects of work in the shop, including health safety, customer relations, stock control, first aid, shop operational matters, weights and measures, licensing, alcohol & tobacco regulations and other relevant subjects.
6. As mentioned, staff will be trained in Heath and Safety issues. But it will be the manager’s responsibility to ensure that all health and safety procedures are abided to.
7. Weights and Measures procedures and actions must comply with regulations and it will be the manager’s duty to ensure compliance.
8. Book Keeping. The manager must maintain all records and work with the business’s accountant to ensure accurate records and accounting procedures are adhered to. This includes VAT, payroll, stock purchase, banking, and bill payment, PAYE and other relevant records.
9. Ensure all mandatory signage and other materials that should be displayed are correctly displayed and are up to date.
10. Insurance. The manager must ensure all relevant insurances are up to date. 11. Ensure that all accidents are recorded in the accident book and any necessary follow action up
to avoid future accidents is taken. 12. Assess risk at all times and take action to avoid risk where possible. 13. Ensure that the business computer system is well managed, particular internet safety/ fraud
theft. 14. Be aware of fire risk at all times and ensure that fire-fighting equipment is kept in good order
and accessible. 15. Ensure that any company vehicles are looked after and maintained and any legal requirements
are dealt with. 16. All machinery including tills, fridges, freezers, packing equipment, coffee grinders and such are
well maintained. 17. Ensure that the shop alarm system is in good working order. 18. The manager should let any volunteers / work experience people know in good time what is
expected of them and let them know that their help is appreciated. 19. The manager will be the personal licensee holder for the shop. 20. Work with local producers to ensure that they are happy with the style of promotion and that
all cross-promotion possibilities are explored. 21. Ensure that the housekeeper is aware of all bookings and that the flats are ready for the next
occupants. 22. The Chair of the Board is the Shop Manager’s line manager. 23. The manager will be responsible for the paying of accounts in a prompt manner.
Notes on Shop Assistants’ duties:
1. Staff should always serve customers in a friendly and helpful manner. 2. Staff should always take care to receive and prepare orders accurately. Inaccurate preparation
can lead to wastage, loss of sales and customer/supplier frustration. 3. Pricing stock correctly, stock rotation and maintaining stock at the correct levels are important.
Being aware that a certain line is either low or out of stock and taking action to remedy the situation is crucial.
4. When delivering to customers staff should be helpful and courteous. Having face-to-face contact with people having purchases delivered also presents an opportunity for staff to promote sales
5. Staff should be aware that the shop must be kept tidy and clean at all times and staff will be expected to have a pride in the appearance of the shop.
6. Staff should be aware of hazards to safety at all times, making sure customers are aware also. 7. Staff should trained in basic first aid. 8. Staff should be trained how to lift properly and should adhere to all guidance on lifting and
moving stock. 9. Staff should check every day that all posters, signs and other promotional or community
announcements are up to date and relevant. 10. Control of refuse and waste is important, both from a Health and Safety point and from the
desire to keep waste stock to a minimum, thus reducing lost profit.
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11. Fridges and freezers must stay within set Environmental Health limits at all times, and records must be maintained to show this.
12. Chilled and frozen food must be moved to the correct storage immediately, and should be checked on receipt to ensure that it is within allowable temperature limits.
13. The Shop Assistants all report to the Shop Manager for line management.
11.6 Self-catering
Based on Visit Scotland occupancy rates for Dumfries and Galloway, we expect the self-catering flats to be filled as follows:
Weeks in month (nominal)
Visit Scotland
Occupancy Statistics
%4)
Weekly rental per property
Gross Income, both Properties
January 4 20 275 440
February 4 30 275 660
March 5 28 275 770
April 4 47 400 1504
May 4 55 500 2200
June 5 58 500 2900
July 4 70 575 3220
August 5 75 575 4313
September 4 55 500 2200
October 4 50 350 1400
November 5 29 350 1015
December 4 26 275 572
Total / Average 52 45 £21,194
Figure 26 – Self-catering occupancy / income assumptions.
The self-catering business will be run in the first instance by outsourcing advertising, bookings and payment collection to a specialist company. It will then be the role of the Shop Manager to keep an overview of bookings, liaise with the guests about access requirements and ensure that the Housekeeper has the flats ready for arrival. Their time to do this is built into the staffing levels shown in Section 10.2 above.
11.7 State Aid
We sourced advice on State Aid from TLT Solicitors of Glasgow because we are requesting public funds to purchase and improve a private business. The advice from Philip Roberts of TLT Solicitors was:
“The funding on this project will not be state aid. The rationale for this is explained below.
All of the following four criteria must be present for the funding to be state aid:
1. It is granted through state resources;
2. It favours certain undertakings or the production of certain goods;
3. It distorts or threatens to distort the competition; and
4. It affects trade between Member States.
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The funding on this project will not affect trade between Member States as the funding will be used exclusively in relation to local activities. Therefore the fourth criterion is not met, so the funding will not be state aid.”
The full text of this advice is attached in Appendix 7.
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12 Fund raising plan
12.1 BIG ‘Growing Community Assets’ fund
The bulk of the capital and operating costs required is being requested from the ‘Growing Community Assets’ fund, part of the Big Lottery Fund (BIG). This fund is designed to support communities in Scotland to take more control and influence of their future through acquiring and developing their own assets such as land or buildings. This fund aims to encourage sustainability within communities by helping them to acquire, manage and develop assets, thereby providing amenities that generate income streams. Development of such assets should improve the social, environmental and economic future of the community. As well as emphasising financial viability, this funding will focus on tackling need. BIG are looking for evidence to show how the organisation has identified those needs through consultation with people in the community and how their project is the best approach for such needs to be addressed. Funds secured range from £10,000 to £1 million. Projects can be funded for up to five years and up to 100 % of costs can be met. As discussed in Section 2, the project is progressing well through the GCA process, having passed the first stage application and the development funding application. This second stage application will be submitted in August 2016 and we will hear whether we have been successful in late 2016.
12.2 Plunkett Foundation
The Plunkett Foundation is a national network that supports community enterprises all over the UK. We have engaged with them since the start of this project, and have received 8 days of mentoring support plus a £2000 grant towards FCA registration and other start-up costs from them. We are most grateful to them for the support and valuable learning resources that they have made available to us.
12.3 Galloway Glens Landscape Partnership Scheme
We have requested the salary for a further 4 hours a week (£7212) for the Communications Engagement Officer in Years 4 & 5 from the ‘Galloway Glens Landscape Partnership’ Heritage Lottery scheme. Focussing on an area within the Ken and Dee river catchments which includes New Galloway at its heart, this is a series of projects that will connect people and communities with the unique natural and cultural heritage of the region. We see the role of the Community Shop, and in particular the role of the Community Engagement Officer, as fitting well with all three of their ‘Outcomes for Communities’:
1. Negative environmental impacts will be reduced
2. More people and a wider range of people will have engaged with heritage
3. Our local area / community will be a better place to live, work or visit.
Decisions about the final projects to be included in the GGLP will be made in August 2017.
12.4 Charitable donations Due to the status of New Galloway Community Enterprises Ltd as a BenCom, it does not in fact have charitable status, although its Rules clearly state that all profits made must be re-invested for community benefit. Therefore many of the traditional routes for sourcing funding locally cannot be used, as they donate solely to organisations with charitable status. However, the true advantage of the BenCom model is that it allows funds to be raised through the medium of a Share Offer.
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12.5 Share Offer
We will create a Share Offer with support from Community Shares Scotland (CSS) in order to really engage local people with the shop project. We have set the price of an individual share purposefully low (£10 compared with the more usual £25) in order to ensure that as many people as wish to be part of the project as possible can invest. Our primary objective is participation and engagement.
We will launch the Share Offer in early 2017 and hope to raise £19,000 while gaining 200 extra members. Even if successful in the BIG application, the grant cannot pay for certain items (such as stock), and the Share Offer funds will be required to pay for these. The Share Offer will be marketed extensively within New Galloway by:
Posters, banners and lamppost signs
Share Offer documentation hand-delivered to every household
Share Launch event
Information drop-in sessions held in Week 2 of the Share Offer
Updates on website, Facebook and Twitter
Attendance at local community groups throughout the duration of the Share Offer to spread the message face-to-face
CSS have written a letter of support for this project, which is given with other letters in Appendix 15. We will apply for a grant for £5000 from them in late 2016 to support the creation of the Share Offer documentation and are most grateful for their support around the technical and practical issues of offering shares. We are also most grateful to the current 81 members of NGCE who have supported us in getting this far with our plans, and are open at any time to new members, both before and after the official Share Launch. Note that membership of NGCE is gained by purchase of one or more shares, so being a shareholder implies being a member and vice versa. Although the Share Offer will be the primary vehicle for recruitment, people may join the organisation at any time by buying a share. This will be publicised in the shop on an ongoing basis in order to keep our membership relevant and representative.
12.6 Contingency fundraising In the event that the Share Offer does not raise sufficient funds, or unexpected capital costs are discovered, we will fill the gap via a range of contingencies. These include:
Staging a fundraising event within the village, such as a dinner or a ceilidh. These are always very popular and if combined with an auction can raise a substantial amount of money.
Asking members for ‘soft loans’ – not donations, but loans that could be paid back at zero or low interest when the business income starts to increase.
Selling ‘Loyalty cards’ for £50 or £100, the cost of which would be recovered through a 10% discount in the shop.
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13 Capital costs
13.1 Assurance The capital requirement for this project is to both buy the property (see Section 13.1.1 below) and to renovate it into a modern shop and self-catering accommodation (see Section 13.2). In order to assure the Board, the community and the funders that the capital costs represent good value for money, various assurance processes have been undertaken, as follows in Sections 13.1.1 to 13.1.4.
The property comprises a retail grocery shop and six-bedroom owner’s accommodation. The building dates from pre1900 and is of traditional stone construction. A traditional ‘U’ shape, the property is built over two levels, however it is built into the hillside at the rear, therefore the upper floor at the rear is at ground level. The plans at the top show the current layout, the plans at the bottom show the proposed layout. See also Appendix 4 for the detailed architect’s plans.
Figure 27 – The existing and final ground floor and first floor architectural plans
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13.1.1 District Valuer Ms Jo Mackenzie, the District Valuer from the Government Valuation Office Agency, visited the premises on 12th April 2106. She also carried out desktop research into the local market and viewed the shop accounts. From this, she determined that the current value of the property was £252,000. This comprised:
£50,000 for the shop, inclusive of fittings and fixtures and the two stores but not inclusive of the stock
£7,000 for the goodwill of the business
£195,000 for the house. Note that ‘goodwill’ in this context is an accounting term, used to allow for the fact that an existing business is being bought. It is in no sense a measure of the affection that a business is held in, or a ‘bonus’ to the owners; it is calculated from the previous year’s accounts as the benefit that the purchaser receives from taking over an existing business instead of setting up from scratch. Although the property came on the market at offers over £300,000 in 2008, its last market position was offers in the region of £260,000. We have gained agreement from the owners that they would sell the house to use as £252,000 in the event that we secure funding to do so. The District Valuer’s full report is given in Appendix 8.
13.1.2 Damp Survey
The valuation highlighted some areas of concern for damp, and so we commissioned a visual survey and report by damp specialists Richardson and Starling. Mr Arthur Blower inspected the property on 30th May 2016 and gave the following recommendations: “Where inspections were made along the front roof and the rear roof, infestations by Common Furniture Beetle (Anobium Puntatum) were located and it is thought treatment will be required to all roofs within the property.” Price – £2,500 plus VAT. These costs have been included in the capital figures. Note that since the property does not currently belong to us, the inspection was by necessity visual only. No intrusive work to look behind plaster or wallpaper was undertaken. The full damp survey report is given in Appendix 9. Note that it makes reference to the ‘extremely damp’ nature of the storage rooms, and gives a quote for waterproofing and damp proof installation in the event that they were to be converted into living quarters. These storage rooms are to be used only to house the hot water boiler plant and so these costs have not been included in the final capital cost.
13.1.3 Flood risk The property has never flooded in all its known history, but with the increasing intensity of the winter storms in the area over the last 5 years, further assurance was required.
Mr Dave Stewart of Stewart Engineering inspected the garden with a view to flood risk on 9th June 2016. His view was that with no history of flooding and given the configuration of hillside and garden, there was no need for major works. The heavily planted woodland uphill of the garden and the size of the garden constitute a natural soak-away to absorb bursts of heavy rain. The worst case scenario would be a severe rain fall onto already sodden or (less likely) frozen ground causing most of the water to run down the garden towards the house. In that event the natural lie of the land would tend to swing the water northwards - towards the house - rather than southwards, towards the drive. In the light of this, he did recommend upgrading the drive to include drains down each side, and this has been included in the capital costs. He also endorsed the plans to make the properties flood resilient i.e. boiler and pellet store will be raised off the floor, high skirting boards, high electrical wiring.
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13.1.4 Structural Survey
Mr Alan Johnson surveyed the property on 2nd July 2016 for assurance as to its structural integrity. Again, the survey was non-intrusive but was done according to his best professional judgement. His full survey results are attached in Appendix 10, but the conclusion is:
“The building is generally in good condition throughout. There are no signs of settlement or movement in any of the external or internal walls. The only evidence of any distress was lateral movement to the random masonry wall supporting the outer edge of the granite steps leading to the garden area at the rear of the building and the first floor French doors. It is recommended that the displaced masonry should be taken down and rebuilt.”
13.1.5 Legal advice
We have taken legal advice from John Henderson and Sons (Dumfries solicitors), who have advised that the total cost of the legal fees, including Land and Buildings Transaction Tax will be £10,580.
13.1.6 Accountancy / HR support We will source HR support during our recruitment process, and to ensure that we are fulfilling our obligations under the TUPE regulations. We have sourced accountancy support to set-up our accounts system and daily financial recording processes and have accounted for the ongoing cost of this in our shop expenses.
13.1.7 Electric van
Monthly operating costs (battery rental) are included in the shop weekly operational costs. The net capital cost will be £14,047, as shown in Appendix 6.
13.1.8 Shop re-stock After renovation, the shop will require an initial re-stock of produce from our old and new suppliers. We have allocated £6,000 for this. This will be funded from our share offer.
13.1.9 Staff training New and current staff will require training in at least the new till system, alcohol sales and environmental health compliance. We have allocated a £3,000 capital cost for these courses.
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13.2 Renovation Costs
The renovation costs have been determined by Mr Andrew Crossan, Quantity Surveyor. His detailed estimate is based on the square meterage of the shop and flats, the specification of the architect and his professional experience. At all points, the costs have been optimised to give best value for money while ensuring a quality product (both of flat and shop) that will fulfil their designated needs.
It is his and the architect’s opinion that the renovation of the shop and the flats can be achieved for the total sum of £308,323, including appropriate contingency costs for the age of the building.
His detailed cost estimate is given in Appendix 11, but a summary breakdown is: Preliminaries (site investigation, skips etc) £19k Purchases: Biomass heating system £45k Soft furnishings of flats £20k Kitchens / Bathrooms £17k Windows £15k ICT / EOPS till system £10k On-costs and extras £20k Building work £31k Wood work / Joinery £58k Roofing £10k Plumbing / heating £6k Plaster / tiling £10k Electrical works £10k Painting £4k Floor coverings £3k Contingency £30k Total £308k
13.2.1 Fees
In addition to the contractor works, various professional fees will be required to manage the renovation successfully. These are: Architect: £11,488 Quantity Surveyor: £3,000 Project Manager: £3,000 Interior Designer: £1,000 Structural Engineer: £400 Building warrant: £980 Total £19,868 In addition, the Project Manager will be required to continue with community engagement, manage staff recruitment, create detailed operational policies, liaise with and report to funders and liaise with other external support such as HR, accountancy and lawyers. Over the course of Year 1, this corresponds to an additional £12,360 in fees (15 hours a week, on average).
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13.3 Total Capital Costs All figures are rounded to the nearest £1,000 and include VAT where applicable.
Purchase price (inc tax): £260,000 Legal fees: £3,000 Stock purchase: £5,000 Share Offer costs: £5,000 Professional fees: £31,000 Garden re-modelling: £1,000 Building Warrant: £1,000 Construction fees: £370,000 Damp treatment: £3,000 Staff training: £4,000 Alternative temporary premises: £1,000 Electric van: £23,000 Bikes for rental £7,000 Signage and branding £4,000 Re-stock costs £7,000 VAT repayments -£76,000 Total £649,000 Of this, £19,000 will come from the Share Offer, £5,000 from a Community Shares Scotland grant and £5000 from a Plug-In Van Grant. The remainder (£620,000) is requested from BIG. Detailed figures are given in Appendix 12, an Excel spreadsheet of costs and cashflow.
13.4 VAT / Corporation tax
NGCE is not currently registered for VAT but will register as soon as it is successful in raising significant funds. Therefore the capital and operational costs can be assumed to be VAT free, although it does of course impact heavily on cash flow, especially when the construction work is ongoing in Year 1. The impact of VAT will be seen more heavily as the shop becomes more profitable, as VAT can be seen as a tax on the profits (although it is recovered from most purchases, the sales outweigh the purchases and so in a profitable company, net VAT is due to HMRC). This is taken into account in the Profit and Loss sheets shown below, and also to the detailed Cashflow given in Appendix 12. Note that VAT on groceries varies, from zero for fresh food, through 5% for certain goods to the full 20% for non-food products. Therefore for our ‘Groceries’ sales, which includes all of these types of product (see Figures 21 and 22), we have assumed an overall VAT rate of 8%. Note also that because the shop and the self-catering flats are both owned by NGCE, whose turnover is far above the VAT threshold of £80,000, VAT will be due on the self-catering income too. This does affect the bottom line for the flats, and hence the amount available to re-invest in the community, significantly, and so consideration should be given in future years to creating a new company that would manage the self-catering flats in a stand-alone manner, well below the VAT threshold. NGCE is a BenCom and as such is liable to 20% corporation tax on year-end profits. This is not included in our cash-flow and profit and loss forecasts, because in the event of a successful purchase, we would apply to OSCR for charitable status, which would render the Society exempt from Corporation Tax.
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13.5 Profit and loss forecasts
13.5.1 Shop
Using the assumptions laid out in Section 11.1 on turnover and mark-up, the expected profit and loss for the shop is as follows:
Year 1 (30%
increase) Year 2 (20% increase)
Year 3 (15% increase)
Year 4 (10% increase)
Year 5 (7.5% increase)
INCOME
Sales £159,344 £191,212 £219,894 £241,884 £260,025
VAT re-payments on stock purchase
£13,211 £15,933 £18,410 £20,343 £21,963
VAT re-payments on other expenditure
£1,293 £1,350 £1,393 £1,452 £1,479
Bike hire £0 £1,300 £2,600 £3,900 £5,200
Electric Van hire £1,040 £2,080 £3,120 £4,160 £5,200
Total income £174,887 £211,875 £245,417 £271,738 £293,866
OUTGOINGS All expenses INCLUDE VAT where relevant
Stock purchases £133,290 £157,586 £178,587 £193,627 £205,205
VAT payments on sales £15,793 £19,332 £22,668 £25,413 £27,830
VAT payments on vehicle rentals £173 £563 £953 £1,343 £1,733
Wages £42,246 £43,091 £43,952 £44,831 £45,728
Rates £360 £367 £375 £382 £390
Insurance £800 £816 £832 £849 £866
Electricity £2,500 £2,550 £2,601 £2,653 £2,706
Telephone £246 £342 £251 £349 £256
Postage/Stationery £240 £245 £250 £255 £260
Marketing £300 £306 £312 £318 £325
Electric van Expenses £1,567 £1,599 £1,631 £1,663 £1,696
Repairs and Renewals £200 £200 £200 £300 £400
Cleaning £663 £676 £690 £704 £718
Staff training £0 £100 £300 £300 £300
Accountancy and book-keeping £2,706 £2,760 £2,815 £2,872 £2,929
Alcohol licence £295 £301 £307 £313 £319
Total expenditure £201,379 £230,834 £256,724 £276,172 £291,661
Shop Profit -£26,492 -£18,959 -£11,306 -£4,434 £2,205
Figure 28 – Shop Profit and Loss
This shows that the shop will struggle significantly for the first 2 years while turnover and mark-up increase, but by Year 5 will have become self-sustaining. As referenced in Section 11.1, achieving 27% mark-up overall is critical, as is increasing turnover and this will need to be reviewed explicitly with the Shop
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Manager on a regular basis. Note also that the bike hire and electric van hire become critical to the success of the shop in later years.
13.5.2 Self-catering Similar properties command a weekly price of £300 low season to £600 peak season. Setting ourselves just below that, Section 11.6 illustrates our predicted income from the self-catering units. Adding the expected expenditure into this gives the following summary:
Income Expenditure Comments
Rental £21,194
VAT re-payments £1,117
Insurance £860 Based on advice from insurers.
Heat and Light £1,920
Based usage of similar size properties
Rates (Small business rate reduction 100%. Water rates only) £400
Cleaner £1,224
Gardener £702
Linen £500
Cleaning Materials £200
Maintenance £600
Marketing (website, local adverts) £400
Commission on bookings (example DiscoverScotland) £3,083
VAT payments £3,532
Totals £22,311 £13,421
Net profit £8,889
Figure 29 – Self-catering profit and loss
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13.5.3 Combined
Bringing the finances of the two enterprises together gives a feel for how they will work as a joint concern. Note that this also includes expected Renewable Heat Incentive payments (RHI) from the government as a result of the use of Biomass heating.
Year 1 Year 2 Year 3 Year 4 Year 5
Shop Turnover £159,344 £191,212 £219,894 £241,884 £260,025
Gross Income SHOP + VEHICLE RENTALS
£174,887 £211,875 £245,417 £271,738 £293,866
Gross Income ACCOMODATION (2 year transition to assumed occupancy rates, then 2% pa increase)
£1,766 £11,714 £17,012 £22,311 £22,735
Income RHI £278 £1,665 £2,572 £3,533 £3,639
Total Gross Profit £176,931 £225,254 £265,002 £297,582 £320,240
Expenditure SHOP
Stock purchases £133,290 £157,586 £178,587 £193,627 £205,205
VAT payments on sales £15,793 £19,332 £22,668 £25,413 £27,830
VAT payments on vehicle rentals
£173 £563 £953 £1,343 £1,733
Wages £42,246 £43,091 £43,952 £44,831 £45,728
Rates £360 £367 £375 £382 £390
Insurance £800 £816 £832 £849 £866
Electricity £2,500 £2,550 £2,601 £2,653 £2,706
Telephone £246 £342 £251 £349 £256
Postage/Stationery £240 £245 £250 £255 £260
Marketing £300 £306 £312 £318 £325
Electric van Expenses £1,567 £1,599 £1,631 £1,663 £1,696
Repairs and Renewals £200 £200 £200 £300 £400
Cleaning £663 £676 £690 £704 £718
Staff training £0 £100 £300 £300 £300
Accountancy and book-keeping
£2,706 £2,760 £2,815 £2,872 £2,929
Alcohol licence £295 £301 £307 £313 £319
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Total expenditure SHOP
£201,379 £230,834 £256,724 £276,172 £291,661
Expenditure ACCOMMODATION
Insurance £860 £860 £877 £895 £913
Heat and Light £160 £960 £1,469 £1,998 £2,038
Rates (Small business rate reduction 100%. Water rates only)
£33 £400 £408 £416 £424
Cleaner £102 £612 £918 £1,224 £1,248
Gardener £702 £702 £716 £730 £745
Linen £42 £250 £375 £500 £510
Cleaning Materials £17 £100 £150 £200 £204
Maintenance £50 £300 £450 £600 £612
Marketing (website, local adverts)
£400 £400 £408 £416 £424
Commission on bookings (example DiscoverScotland)
£637 £1,534 £2,195 £2,736 £2,779
VAT payments £294 £1,766 £2,702 £3,675 £3,748
Total expenditure ACCOMODATION
£3,297 £8,096 £10,668 £13,390 £13,646
Total expenditure ENTERPRISE
£204,676 £238,930 £267,392 £289,562 £305,307
Total Gross Profit on ENTERPRISE
£176,931 £225,254 £265,002 £297,582 £320,240
Net Profit or Loss -£27,745 -£13,676 -£2,390 £8,020 £14,932
Figure 30 – Combined Profit and Loss
13.5.4 Big Lottery Operational Subsidy
The above figures are a stand-alone projection of the costs of the enterprise. If we are successful in our application to the Big Lottery, we will also receive an operational subsidy towards the costs of the staff. This is because they are aware that small businesses often struggle in the early years of start-up and wish to support them through this stage. In order to be clear on how our project is structured to meet the needs of the community, we have asked for the subsidy based on the following assumptions:
The purpose of the self-catering accommodation is to generate funds in order to meet the needs of the community, and that business should therefore be stand-alone from when the accommodation opens – as indeed it is. Therefore these funds will be ring-fenced for the needs of the community, as set out in Section 4.5, after making the required contribution to the Reserve fund.
The purpose of the shop is to meet many other, more intangible needs of the community. Therefore the Big Lottery will (if the application is successful) subsidise the operational costs of the shop such
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that it turns a small profit based on a worst credible case scenario. This scenario is outlined in Section 11.1.1, Figure 23 and given in more detail in Figure 31 below.
The purpose of the Community Engagement Officer is entirely charitable and their services will be free to use. Therefore we are asking for their full salary for 2 days/ week throughout the 5 years of the project, and will be seeking a further half day funding for Years 4 & 5 from the Galloway Glens Landscape Partnership project.
13.5.5 Worst case scenario funding INCOME
Year 1 Year 2 Year 3 Year 4 Year 5
Sales £140,958 £155,054 £170,559 £187,615 £206,376
VAT re-payments on stock purchase
£11,686 £13,113 £14,531 £15,896 £17,392
VAT re-payments on other expenditure
£1,293 £1,350 £1,393 £1,452 £1,479
Bike hire £0 £1,300 £2,600 £3,900 £5,200
Electric Van hire £1,040 £2,080 £3,120 £4,160 £5,200
Total income £154,977 £172,897 £192,203 £213,023 £235,647
OUTGOINGS
Stock purchases £117,911 £129,702 £140,958 £151,302 £162,501
VAT payments on sales £15,508 £17,440 £19,603 £22,025 £24,735
VAT payments on vehicle rentals
£208 £676 £1,144 £1,612 £2,080
Wages £42,246 £43,091 £43,952 £44,831 £45,728
Rates £360 £367 £375 £382 £390
Insurance £800 £816 £832 £849 £866
Electricity £2,500 £2,550 £2,601 £2,653 £2,706
Telephone £246 £342 £251 £349 £256
Postage/Stationery £240 £245 £250 £255 £260
Marketing £300 £306 £312 £318 £325
Electric van Expenses £1,567 £1,599 £1,631 £1,663 £1,696
Repairs and Renewals £200 £200 £200 £300 £400
Cleaning £663 £676 £690 £704 £718
Staff training £0 £100 £300 £300 £300
Accountancy and book-keeping
£2,706 £2,760 £2,815 £2,872 £2,929
Alcohol licence £295 £301 £307 £313 £319
Total expenditure £185,749 £201,170 £216,221 £230,728 £246,209
Shop Profit, net of VAT
-£30,772 -£28,273 -£24,017 -£17,706 -£10,562
Sum -£111,330
BIG Wage subsidy % 74% 67% 56% 41% 24%
BIG Wage subsidy £ £31,262 £28,871 £24,613 £18,381 £10,975
Subsidised Profit £490 £598 £596 £675 £413
Figure 31 – Subsidised Profit and Loss – worst case scenario
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Note that this includes a 74% wage subsidy in Year 1, decreasing to 24% by Year 5. This clearly raises question of sustainability, but it must be remembered that this is based on a worst-case scenario. If the subsidy is plugged back into the shop’s target assumptions, then the shop profit becomes:
Year 1 Year 2 Year 3 Year 4 Year 5
BIG Wage subsidy £31,262 £28,871 £24,613 £18,381 £10,975
Subsidised Profit £4,770 £9,912 £13,307 £13,947 £13,180
Figure 32 – Subsidised Profit and Loss – targets met
Even with no subsidy for the shop at all in Year 5, if targets are met then the shop generates a small profit of £2205, as shown in Figure 28. We believe that this structured approach to the grant application makes it clear where the money will be spent and why, and protects the shop from any rocky first years while not generating excessive profits. Note that any extra profits made as per Figure 32 above will be first invested in the necessary Reserve Fund that good governance requires, and then re-invested in the community as per our strategy for disbursing the self-catering funds. Note also that the Community Engagement Officer will be expected to start sourcing continuation funding of their project from the start of Year 4. Hopefully by then their track record of community engagement and support will generate alternative charitable funding.
13.6 Total grant request We are requesting the sum of all the subsidies in Figure 31 above, plus the salary and expenses for the Community Engagement Officer, plus an extra subsidy for the first 5 months of operation when the shop will be owned by the community but the renovations won’t yet have taken place. This comes to £114,101 £72,816 £3,000 Total £189,917 over 5 years. Added to the capital sum requested in Section 13.3 of £619,893, this gives a total grant request to BIG of £809,810.
13.7 Cash flow
Detailed cash flow charts are given in Appendix 12. They show that an extra £600/ month for the first few months of Year 1 will be required, in order to meet the extra staff costs before the shop is renovated and the turnover and mark-up assumptions kick in. They also show that the large VAT repayments due in Month 5 of Year 1 and every 3 months for 9 months from then on (due to the high construction costs) will be used first to offset the capital grant request from BIG in those months, and latterly to offset the operational request, since the final large VAT repayment will come after the capital grant is spent. As expected, the net effect of this is that the capital request to BIG is that of the construction / renovation quotes net of VAT.
13.8 Member returns
As discussed in Section 2.7, NGCE is allowed to pay returns on share-holdings at a level capped at 2% above the Bank of England base-rate. However, NGCE will make it clear that this should not be an expectation held by share-holders. Purchase of a share-holding in New Galloway Community Enterprises and hence the Community Shop should be seen as a social investment in the future of our community, not as a means of realising monetary value from that investment.
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it is very also unlikely that withdrawals will be available for the first five years and therefore provision for this is not included in the cash flow modelling. There is an aspiration to make funds available for withdrawal at a rate of 10% of total share capital per year after Year five (unless on the death of a shareholder, when repayment will be made immediately if possible).
13.9 Sustainability
By the end of Year 5, the self-catering accommodation will have been generating funds at expected levels for at least two years, at around £9,000 pa. The majority of this will have been re-invested in the community as per our priorities, but some will have been set aside into a Reserve Fund as part of good governance. This money will be available for capital repairs to the property and to tide the business over during times of economic down-turn. It is also a prudent reserve for redundancy payments, should the worst happen and the shop have to shut.
By the end of Year 5 also, the shop will be generating a small but sustainable profit for itself. If allocated, the BIG subsidy will continue through Year 5 because it is based on a worst-case set of assumptions, but if we meet our targets as we plan to, it will no longer be required for the viability of the shop. Therefore when the funding ends, the shop will be able to sustain itself into the longer term.
Note that any profits created by the shop throughout the first 5 years over and above the worst-case scenario will be put into the Reserve fund referenced above. The self-catering income will only be required to top this up if it does not meet our target level of £30,000 by the end of Year 4.
The other element of BIG funding that continues to the end of Year 5 is the salary of the Community Engagement Officer. The aims of this role are purely charitable and their services will be free at the point of use. Therefore there is no intention or expectation that this role will be sustainable at the end of this period.
Instead, the Community Engagement Officer will be tasked with finding themselves replacement funding from the end of Year 4 onwards. By then, they will have a good understanding of the next projects that the community requires, and it may be that funding can accompany those, or it may be that the track record of achievement of the role itself will attract funding.
In the worst case scenario that no funding is found, the combined profits of the shop and self-catering business would just about cover this salary. It would then be for the incumbent Board of Directors, in close consultation with the community, to decide whether this role is worth funding ourselves. It is impossible to anticipate this decision, but it can only be good for the village that it is even an option.
In summary, in 5 years’ time, the business arms of the organisation will be well established and sustainable into the long term. They can continue to meet the many needs that we have designed them to assist with with no further external support. The charitable arm will be more challenging to continue, but with three options available and by then an excellent track record of delivery, we believe that this too will continue at least into the medium term.
13.10 Contingencies Part of the Board of Directors clear remit is annual reviews of both shop and self-catering financial performance. This Business Plan sets out clearly the required performance required to assure success post-BIG funding. If by Year 3, the performance targets for the shop are not being met, various levers are available to assure sustainability for Year 6 and beyond:
Increased frequency of monitoring of performance
Intervention with shop staff to create an action plan
Increased use of volunteers to decrease staffing costs
Reduced opening hours in winter. By regular monitoring and review against clear targets, we will see any dangerous trends developing early and will be able to intervene before crisis levels are reached.
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14 Risk Analysis
14.1 SWOT analysis
Persons carrying out analysis:
Mike Brown, Chair; Mary Smith, Board Member; Helen Keron, Project Manager; Poppy Gilbert, External RA practitioner.
(Name and Role) Date of analysis 1st July 2016
This analysis covers the operation of the Community Shop, the self-catering accommodation, the work of the Community Engagement Officer and the governance of the Board. It is a high level document, designed to help us understand the strengths and weaknesses of our Project and act accordingly.
Strengths
Social capital - as already demonstrated by huge volunteer effort on the project to date, and by professional people giving their time / advice for free.
Existing strong sense of community within New Galloway.
There is a definite and immediate need - this is not an amorphous or hypothetical project.
We have prioritised and achieved clear, regular and varied communication, both internally within and external to the project.
We are a focused and effective Board, skilled at resolving differences of opinion through discussion and supportive of our paid team.
We are a geographically constrained community that is therefore well defined and easier to engage.
We are situated in a region that produces plenty of food, which allows local produce to be a realistic focus for the shop.
We are a sustainable project into the medium and long term due to the addition of a self-catering business to the village shop.
There is an existing tourist market, thanks to the CatStrand, the tearooms and the area’s wider assets, which we can tap into and expand.
Weaknesses
We have limited retail / accounting / HR experience on the Board
Our limited geographical area means we have a relatively limited skills pool from which we can recruit new Directors.
It also means we have a relatively limited pool of local residents to support the shop by buying supplies there.
Opportunities
The shop and back-office could become a real focal point for the village, even more so than just a usual thriving shop would be.
There has to be investment in an area in order to attract new people into it, whether that's financial investment or social investment like this. Also success breeds success.
Partnership working - once the project is a reality, there will be many opportunities to partner with businesses and third sector organisations to meet more needs and to fill the self-catering accommodation out of season.
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Threats
A possible recession resulting from Brexit or other financial turbulence.
If we get the staffing / marketing / shop offer wrong, the project simply won't get off the ground.
If BIG GCA funding is not forthcoming, recreating the project using local funding sources is extremely unlikely.
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14.2 Risk Assessment The full risk assessment is given in Appendix 13, but a summary is: SHOP risks and mitigating actions: 1. The shop staff (in particular the Manager) are not of a high enough calibre to manage the stocking
of the shop effectively. This will result in low mark-ups and associated poor financial performance.
Advertise roles widely and ensure an adequate timeframe is allowed for the appointment process.
Use external interview panellists and source professional HR advice to ensure impartial and expert assessment.
Offer appropriate remuneration to attract strong candidates
Create a clear job specification and person description
Ensure that expectations are clear and performance is reviewed at least annually – more often in the first year of appointment.
2. Key market segments are alienated, reducing turnover. Specifically: A deli-style shop will alienate
some residents; a Spar-type shop will alienate others; a 'local shop for local people' will alienate tourists.
Use the results gathered from the questionnaires and community consultation to inform the look of the shop.
Use the research done into other successful community shops to inform the look of the shop.
Gather feedback from users routinely and non-users in targeted efforts to ensure that the shop is meeting all the community needs.
3. Poor relationships with our suppliers, leading to not being able to stock desired products.
Implement and follow a policy of paying all suppliers within 30 days.
Work with local suppliers on product promotion days and advertising within the shop.
4. Supply chain broken due to adverse weather effects: flooding, rain or snow.
Ensure that critical supplies e.g. milk and bread are routinely sourced from as close as possible to the shop, to maximise the likelihood of supplies being maintained.
Follow the weather forecasts and stock up on non-perishable staples e.g. tins, flour etc in advance of any poor weather.
5. Damage to the shop property, fittings or stock due to adverse weather effects, specifically flooding.
Ensure that the shop and fittings are designed to be flood resilient; specifically polished concrete floor throughout, heating system and stock cupboards raised on plinths, nothing stored on the floor when poor weather forecast.
Seek professional advice on the likelihood of flooding from the back garden.
6. Damage to our reputation due to poor environmental practices e.g. recycling, waste disposal, packaging.
Implement and follow clear policies on waste segregation and disposal and recycling. Ensure that waste is not allowed to build up where the public can see it.
Minimise packaging in store whenever possible.
Encourage customers to bring their own bags. Provide members and first-week customers with a free, branded, reusable bag, have them available for purchase.
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7. Higher costs in time due to a lack of preventative maintenance.
Implement a clear strategy of preventative maintenance, to cover: PAT testing, legionella testing, pest control, timber re-painting, checks on roof after winter, regular gutter cleaning; regular pavement and yard sweeping, regular checks on drains, window cleaning; annual deep-cleaning.
8. Non-compliance with Environmental Health requirements: Use-by dates, Food segregation, Food
preparation, Fridges and freezers.
Enlist Environmental Health advice in advance of capital works and shop fit-out
Implement and follow clear policies on: food segregation, use-by and sell-by date monitoring (stock rotation), fridge / freezer temperature monitoring and recording, hand-washing / personal hygiene, fresh food preparation and storage, First Aid training, accident book. To include a HACCP analysis of supply and storage of all fresh food.
9. Poor Health and Safety environment or behaviours, affecting both staff, volunteers and the public.
Implement and follow a clear HSE policy, based on a specific risk assessment of the physical hazards the staff, volunteers and/or public could encounter. To include at least: slips and trips, electrical hazards; fire safety.
10. External economic factors leading to poor turnover e.g. recession.
Monitor external factors and prepare accordingly.
11. Poor shop-keeping e.g. display of goods, friendliness of staff, cleanliness of shop etc leading to poor turnover.
Ensure that expectations of the shop staff are clear and that performance is formally reviewed annually and informally monthly.
Ensure that users can feedback at any time about conditions of the shop / staff attitude in a confidential manner. Encourage use of this system for both good and bad feedback. Log verbal feedback.
Nominate a Board member to be a specific Point of Contact (PoC) for the Shop Manager, to form a personal relationship and to allow good support and communication.
12. Poor consideration of equality of access leading to some members of society being unable or
unwilling to use the facility e.g. disabled access, a welcoming and inclusive environment.
Remove the step in the floor of the shop, to allow full wheelchair access throughout.
Ensure that expectations of the shop staff are clear and performance is formally reviewed annually and informally as necessary.
13. The necessary insurances and licences are not in place and so the shop is not legally compliant:
Building, Contents, Employers' liability, Public liability, PPL, Business interruption, alcohol licences.
Initial and ongoing training is undertaken to gain licences; maintenance of licences is written into the Shop Manager's Roles and Responsibilities.
All insurance is taken out in advance of the purchase, to ensure we are covered from Day One.
Ongoing maintenance of the insurance is written into the Shop Manager's Roles and Responsibilities.
14. The opening hours do not match the requirements of the customers, leading to low turnover.
Ensure that users can feedback at any time about opening hours. Be flexible in approach within wage-bill constraints.
Monitor customer usage across the week and feedback to the Board about any major trends.
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15. The stock lines do not match the requirements of the customers, leading to low turnover.
Ensure that users can feedback at any time about the stock lines. Encourage use of this system for both good and bad feedback. Log verbal feedback.
Shop Manager to be alert for seasonal promotions and items that they think might interest their customers.
16. Failure to retain staff, resulting in retraining of staff, no development of staff and the service
suffering.
Clear expectations and Roles and Responsibilities are laid out at the start of any role.
Appropriate remuneration
Appropriate level of supervision / management support. 17. Theft/Stock Loss through poor stock management affects profits.
Training of staff
Security system appropriate to New Galloway
Layout of store to enhance sightlines. 18. Competition opens up in village or nearby.
Monitor, maintain awareness 19. Key workers suffer major illness and cannot work for lengthy period.
Having 3 shop assistants should provide cover amongst themselves for short-term cover.
Train assistants in the essentials of the Shop Manager role so they can provide short-term cover while a temporary role is advertised and filled.
Create a pool of trained volunteers within the village who can cover in emergencies, for example if staff live out the village and are cut off by extreme weather.
SELF-CATERING risks and mitigating actions: 1. Managing a tourist accommodation business is too complex for a voluntary Board of Directors.
Outsource bookings management and online/print marketing to a dedicated service e.g. Sykes
Train members of the Board in an overview of running a self catering business.
2. This is a new venture so risk of getting it wrong at first.
Offer a free trial week to friends of the enterprise in order to gain detailed feedback about their stay before opening to the general public.
3. Higher costs in time due to a lack of preventative maintenance.
Implement a clear strategy of preventative maintenance, to cover: PAT testing, legionella testing, pest control, timber re-painting, checks on roof after winter, regular gutter cleaning; regular pavement and yard sweeping, regular checks on drains, window cleaning; annual deep-cleaning.
4. The necessary insurances are not in place and so the enterprise is not legally compliant: Building,
Contents, Public liability, Business interruption, specific Self catering insurance.
All insurance is taken out in advance of the purchase, to ensure we are covered from Day One.
Ongoing maintenance of the insurance is written into the Shop Manager's Roles and Responsibilities.
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5. Non-compliance with HSE requirements e.g. fire regulations
A full HSE risk assessment of the operation of the self catering facility is carried out and implemented. To include at least: Maintenance of safety critical equipment, management of fire risk from laundry, slip trips and falls, cleanliness standards.
All required actions are included in the Shop Manager and Housekeeper's Roles and Responsibilities.
6. Impact of changes in the economy on people's holiday habits.
Monitor external factors and prepare accordingly. 7. The key market is very seasonal, which will lead to out-of-season slumps.
Partner with other organisations e.g. Dementia Awareness, SSAFA ( a military charity), CatStrand to offer dedicated or themed weeks or weekends, particularly in low season. Links with these organisations are already informally in place.
8. Inadequate or absent on-line presence therefore no on-line bookings.
Outsource bookings management and online/print marketing to a dedicated service
Make use of the new village website www.newgalloway.com to advertise the shop and accommodation.
9. The management of bookings, payments etc is poor, leading to poor customer experience.
Outsource bookings management and online/print marketing to a dedicated service.
Check up on service provider’s performance at least annually, to ensure we are getting value for money.
10. Local residents are disengaged from the self-catering project; assume it isn’t for them.
Offer last-minute discounts to local residents who might have friends and family visiting during the low season.
11. Staff are inadequately selected or trained to provide the standard of hospitality industry service with regard to meeting clients' needs, with resulting loss of reputation.
Ensure work connected with the accommodation business is explicitly included in the Shop Manager's Roles and Responsibilities to avoid misunderstandings.
Set clear expectations with the Shop Manager and Housekeeper and review formally annually; informally monthly.
12. Accommodation design and decoration is inappropriate for market.
Convene sub-committee of the Board to meet and agree general look of the flats, bearing in mind our key markets of older people, families and outdoor enthusiasts.
13. Insufficient bookings taken
Outsource bookings management and online/print marketing to a dedicated service e.g. Sykes
Check up on service provider’s performance at least annually, to ensure we are getting value for money.
Advertise the accommodation locally and in specialist publications e.g. astronomy, mountain biking.
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14. No repeat business due to unsatisfactory experience
Ensure work on the accommodation business is included in the Shop Manager's Roles and Responsibilities to avoid misunderstandings.
Include personal touches in the welcome pack e.g. annotated maps, lists of things to do, discount vouchers.
Write to people afterwards thanking them for their stay.
Survey customers to gain insights to the quality of their stay. 15. The allocation of grants made possible from profits is perceived as unfair, leading to community
alienation.
Ensure a clear and transparent process for grant giving is in place and updated annually. Appoint a sub-committee for grant disbursement, open to all members and selected annually at the AGM.
COMMUNITY ENGAGEMENT OFFICER risks and mitigating actions: 1. Getting the right person into this role will be crucial.
Create a clear job specification and person description
Use HR support to assure rigorous recruitment process
Advertise widely, with ample timescales
Use an external interview panel to assure fairness
Offer good level of remuneration to attract strong candidates
Offer flexible working to attract as many candidates as possible.
Ensure the person is PVG checked. 2. Ineffective advertising of the services this role can offer will lead to low uptake.
Advertise the available services routinely in local publications, in the shop and through appropriate local networks.
Advertise specific events through posters, flyers and social media.
Ensure reports on events / services are routinely included in local publications to maintain awareness.
Ensure the Community Engagement Officer understand that the majority of their time should be spent in the community, not behind a desk.
3. It will be easy for this person to become over-worked and then to burn-out or move on.
Nominate a specific person on the Board (who has no other responsibilities) to be the point of contact (PoC) / supervisor. Meet at least monthly to discuss performance, strategy and upcoming challenges.
Be very clear with service users about the amount of time that can be allocated to them.
Use the Board PoC to help allocate priorities and if necessary communicate with users 4. High turnover of people in this role will mean they are less effective at delivery
Discuss commitment and expectations with candidates during the recruitment phase. (Take professional HR advice on appropriate / allowable questions)
Support from the Board as per previous actions. 5. The community is alienated from the role because they don't understand / see the value.
Ensure reports on events / services are routinely included in local publications to maintain awareness.
Do some high-visibility projects early on, in order to raise awareness.
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6. Ineffective partnering with other organisations will result in poor delivery.
Ensure that expectations on partnering are clear and performance is reviewed at least annually.
Get the right person in the role such that partnerships are effective. 7. Lone working while community visiting
Implement a Lone Worker policy appropriate to the level of risk in New Galloway. To include checking in and out, PVG checks and personal risk assessment each time.
BOARD risks and mitigating actions: 1. Poor governance leads to lack of trust within the community.
Hold and publicise AGMs in good time. AGMs to be managed effectively and to include: Setting of strategy for grant giving, gaining feedback on the shop, gaining feedback on the Community Engagement Officer, review of annual accounts.
Ask an external authority (Plunkett Foundation?) to review and provide feedback on the first year of governance.
2. Poor governance leads to issues with the FCA or HMRC (VAT, PAYE).
Engage an accountancy firm to create and deliver annual returns as required.
Ensure the Shop Manager is briefed by the accountancy firm in respect of records which the staff will have to keep.
3. Inappropriate levels of staff management leads to conflict and poor delivery (not enough / too
much).
Early discussions between staff and Board members to set expectations.
Staff and Board members to work hard on creating personal relationships between them such that feedback about under / over management can be given and received constructively.
4. Relationships with staff are not managed well, making it hard to carry out effective performance
reviews. Especially difficult in a small village.
Staff and Board members to work hard on creating personal relationships between them such that performance reviews are useful to both sides.
Board and Shop Manager should have access to HR advice as required. 5. Employer's responsibilities are not carried out, leading to sanctions by the FCA, HMRC or HSE -
pension, NI, HSE compliance.
Risk assess the business from the point of view of staff and volunteer safety shortly before start-up.
6. The turnover of Directors on the Board is too high, leading to lack of continuity, or not high enough,
leading to stagnation.
Expectation of a 3-year term is set with Directors on recruitment. With 9 Directors, this will give a good rotation through the members.
7. The skills mix on the Board is not appropriate for the businesses being managed.
Targeted recruitment of Directors to ensure good skills mix.
Annual training for Directors to address missing skills. Take Plunkett Foundation advice on suitable courses.
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8. Poor communication with members / insufficient recruitment of more members leads to a non-representative organisation.
Implement a membership communication / recruitment strategy
Membership to be open to all qualifying people at all times, this fact to be repeated in all advertising and in the shop.
9. Poor management of a complex set of businesses with employees is too much for a voluntary
Board of Directors.
Outsource complex aspects of the business to professionals e.g. accountancy, payroll, IT, online booking management, HR support.
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15 Management to date – Development Phase
Although of a different order of magnitude from a successful Second Stage grant, we feel that the way that NGCE has managed its affairs during this Development Phase lends credibility to our claim that we are a rigorous, transparent and effective organisation.
15.1 Financial Management
We managed the £44,153 first stage grant from the Big Lottery through regular updates from the Project Manager and monthly Board scrutiny. Our financial monitoring spreadsheet is attached in Appendix 14 and we would expect to use this same technique to manage the second stage grant. All but 3 of our 13 cost items were on or under budget, demonstrating the credibility of that budget, and we came in £8,863 or 20% under budget.
15.2 Communication
We used a Risk Register to flag and monitor ongoing risks in the Development Phase, and maintained a Communications Log in order to keep all Board members up to speed. We used DropBox to share files and ensure that information was accessible at all times. We used a combination of Board meetings, sub-committee meetings, emails and one-on-one catch-ups to ensure that all people involved were in the loop at all times.
15.3 Recruitment We recruited our consultants through a rigorous process of short-list and interviews, and used external interviewees where we felt it was important. A good example of this was in the recruitment of the Local Project Manager. The existing Chair of the project, Helen Keron, applied for the role, and so it was critical to ensure that a fair, transparent process was in place. The other 2 short-listed candidates and the Chair were interviewed on the same day by our Development Consultants and an external interviewer, with a member of the Board sitting in but not actively taking part. Their role was simply to ensure that the final candidate was someone the Board would be happy to work with. The candidates were independently scored by each interviewer against set criteria in response to a range of questions. The Board member then left the room while the interviewers compared scores and discussed the candidates. The Chair had received the highest marks from both interviewers and the Board Member confirmed that they were happy with this outcome. Helen was therefore offered the role. At this point she resigned from the role of Chair and Mike Brown took over.
15.4 Community Engagement As detailed in Section 6.2.1, we engaged with the community throughout the Development Phase, spreading the word and gaining enthusiasm for the project. This will hopefully be born out by the results of the Share Offer in 2017.
We hosted targeted consultation sessions:
School children, 12th May 2016
Existing shop users, 13th June 2016, full day in the shop.
Local business owners,15th June 2016
Open Morning and Open Evening (drop in sessions), 20th June 2016
We attended 8 existing community group meetings that created access to relevant people for us.
We gave out questionnaires at each of these sessions, and left copies in the shop, Smithy tea room and CatStrand arts centre.
We created postcards of the schoolchildren’s logo designs, with information about the questionnaires and an update on the project on the back, and posted them through every door in the village.
We held one-to-one meetings with other third sector or public sector organisations that serve hard-to-reach individuals.
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We discussed the issues informally around the village at all opportunities.
We received 142 completed questionnaires back.
We created Case Studies from some of our most useful informal consultation sessions.
15.5 Local development
We spent 72% of our Development grant on people and services from within 23 miles of New Galloway. We tendered broadly and openly, ensuring that we selected the right person or service for the job in each case against objective criteria, but we were pleased to keep so much of the spend within the local economy. It also minimised the carbon footprint of the project, with much reduced driving times to meetings etc. We will continue this awareness of trickle-down benefits to our local economy and minimising our carbon footprint into the Renovation and Operational Phases.
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16 Summary 16.1 Vision Statement
The outcome of our community engagement over the last 18 months is that we have a clear view of what success will look like for our village.
In 5 years’ time our village will:
Have a thriving Community Shop which operates as a social hub and focus for community involvement for all residents, as well as providing them with the groceries and services they need.
Have established itself as a well-known and popular visitor destination with a coherent tourist offering that leads to repeat bookings, and therefore will have increased the viability of the other local businesses.
Have generated £26,000 of profit from the self-catering accommodation and a further £55,000 when the shop meets its targets. Of this, £32,000 will have been reinvested into the community, £19,000 set aside for legacy projects such as micro-generation and £30,000 maintained as a prudent reserve fund.
Be generating £11,000 of sustainable yearly income from the shop and self-catering enterprise, available into the future for New Galloway and its residents.
Have created a key role in the shape of the Community Engagement Officer, who will have facilitated initiatives by local residents, businesses and charities to sustain and enhance the community, while also providing vital social well-being services within the village.
16.2 Meeting the needs
In achieving this Vision, we will have met our identified needs:
To address the continuing reduction of services provided to an ageing population and for people with limited transport options.
o The shop provision will be financially sustainable and meeting the needs of all its key markets.
To provide employment, volunteering and work experience opportunities in New Galloway. o Jobs, volunteering opportunities and work experience will be well-established options for the
young, old and everyone else in New Galloway.
To address issues of social isolation, particularly for older people, young families and carers. o The Community Engagement Officer will have formed meaningful links with vulnerable and
hard-to-reach members of our community who request support, and will have helped them both directly and by supporting them in getting access to other services.
o The shop will continue its key role of keeping an informal eye on the vulnerable members of the community, allowing them to live independent lives for longer.
To foster a sense of empowerment within the community and allow people to feel that they have a stake in the future of their village.
o The membership list will be thriving and people will enjoy the experience of being a Director. o Shop users will have a real sense that they are supporting their own community and future
by using the shop. o The reinvestment back into the community will have made a noticeable difference to
people’s lives and they will enjoy feeling part of that process.
To foster a sense of inclusion and belonging in the community for all. o The shop will be a welcoming and inclusive environment where people enjoy meeting friends
and neighbours. o Community event days organised by the Community Engagement Officer have brought the
community together and created new relationships within the village, both between people and between organisations.
To create a more viable local economy, including through direct employment. o 2.6 FTE equivalent jobs will be maintained into the long term.
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o Local businesses will work better together and will have seen a material improvement in their business due to mutual support and promotion of New Galloway services, both to tourists and to residents.
To provide local access to advice on benefits and services. o The Community Engagement Officer hosts regular expert drop-in sessions and is a known
point of help for times of personal crisis within the village.
To improve community resilience. o The warm / lit self-catering accommodation is a known safe haven in times of extreme
weather. o The community is better able to care for its own due to the maintenance of informal networks
that are the crux of rural living. o The Community Engagement Officer is a true community resource whom people trust to get
things sorted, either directly or indirectly.
To reduce environmental impact by reducing the need for car journeys. o Residents default to the shop for things they have run out of, instead of automatically driving
13 miles to Castle Douglas because they have confidence the shop will be open and stocking the lines that they want.
We have a detailed understanding of the needs of our community and a coherent and detailed plan for meeting them. If the application to
BIG is successful, the initial injection of capital and then some operational support will ensure that the legacy for New Galloway is a thriving and sustainable village shop, an income-generating business
and a re-vitalised and empowered village, keen to meet the challenges of 21st century living in a remote-rural context.
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17 Declarations of Interest In Section 4.3, reference is made to a local supplier of frozen food, ‘Love To Eat’. This business is run by Dawn Spernagel (Board Member) and Helen Keron (Project Manager). David Briggs (Board Member) is the co-owner of The Smithy Tea-rooms, also referenced in this Business Plan.
Margaret Watson (Secretary) and Helen Keron are Directors on the Board of GCAT.
Helen Keron is a Community Councillor for New Galloway and Kells Community Council
Helen Keron is on the Board of the Galloway Glens Landscape Partnership Project and of Third Sector Dumfries and Galloway.
All of the above roles are entirely voluntary.
18 References
1 Scotland Census 2011 www.scotlandscensus.gov.uk/ 2 Stewartry Local Area Profile 2015 www.crichtoninstitue.co.uk 3 Rural Scotland Key Facts 2015. www.gov.scot/Publications/2015/03/5411/1 4 Report to Councillors June 2016 As reported in www.dgwgo.com/business/economy-growing-tourism 5 Tourism Intelligence http://www.scottish-enterprise.com/services/develop-your-
organisation/tourism-intelligence-scotland
19 Appendices 1: Needs Survey results May 2015 2: New Galloway Community Enterprises Ltd Model Rules (Constitution) 2a: FCA Registration Certificate 3: May 2015 Options Appraisal (updated July 2016) 4: Architect’s plans 5: Community Engagement results June 2016 6: Electric van details 7: State Aid advice 8: District Valuer’s report 9: Damp Survey report 10: Structural Survey report 11: QS Cost estimate 12: Cash flow and other financial calculations 13: Operational Risk Assessment 14: Financial monitoring spreadsheet 15: Letters of support