Latest News from Everett Masson & Furby
Selling A Convenience Store or Newsagents
It is hard to believe we are now half way through 2023 and the usual prime Spring/Summer selling months are upon us. Whilst these are usually the busier months EMF are pleased to report activity in the sale of Convenience Stores/Newsagents has remained strong and particularly busy. Demand remains high, and supply remains low, driving activity with sales quickly agreed, and a substantial number other potential buyers waiting in the wings should the sale falter.
EMF were delighted to recently complete on the sale of Richards Newsagents in Fareham, Hampshire (pictured), a long established Freehold business with extensive accommodation which went under offer within 2 weeks of going on the market.
So you are thinking of selling? The first thing you will want to know is how much it is worth and the best option to find this out is to contact your local EMF office to arrange a free no obligation market appraisal. Saying this you may already have an idea of value, but how has this been arrived at, Turnover or Profit?
On a number of occasions potential sellers have an expectation on price based on their weekly sales, but questions you have to ask yourself, do these weekly sales include VAT, do they include Services such as Lottery and Paypoint, what is the product mix – high margin items or low margin items such as tobacco? The important factor to calculate is the Gross Profit, following which a Net profit has to be calculated taking into account items such as the level of rent, business rates, staff and energy costs which can vary considerably from business to business.
From the above it can quite clearly be seen that Profit is the name of the game when coming to valuing a business, ask yourself, would you prefer to buy a business taking £10,000 per week making £100,000 profit or a business taking £20,000 per week making £50,000 profit? It is the old adage ‘Turnover for Vanity, Profit for Sanity’!