An extract from the minutes of the last committee meeting in January:
Margins – It was noted that at present we add a profit margin of 23% generally onto goods and DC [David Curran – Chair] asked if we need to increase it. The general feeling was that in the present climate we should try to maintain that figure for the time being, but to continue monitoring.
We are very mindful that we are a community shop and not a convenience store, and as such our priority is to the customers and not to the ‘bottom line’. The cost of living crisis affects us all, and anything the shop can do to help is paramount in our running of the shop, a major village asset. As we always harp on about, we are entirely run by volunteers, so our overheads are as low as they can be as we pay no wages and therefore no tax and NI contributions associated with employment.
So as long as we make a small surplus each month to cover the expenses we do incur, we are happy to keep our margins as low as possible. It’s worth noting that 23% is a general margin and some items such as eggs, milk and bread we operate on a much lower margin, say 10% or even cost.
David and Tim went to a Devon Community Shops Network meeting in February to meet other groups who run community shops to share ideas, traumas and wisdom. In the discussion on the cost of living, it came up that the other shops’ margins all seemed a little higher than ours as they mostly have paid employees. We came away with some new ideas for suppliers, a neat taxsaving scheme we hadn’t heard of and a feeling of camaraderie with fellow community shopkeepers.
With reasonable footfall, we will maintain our turnover and be able to keep prices low. Do use the shop, you’ll be surprised how much cheaper some of our lines are in comparison to the big supermarkets and of course, it’s on your doorstep.
Tim Woolgar
