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The Village Stores Management Committee have circulated a list of answers to frequently-asked questions ahead of next Tuesday's vote on whether or not to put a Post Office Local in Brightwell Village Stores. Members should have received this list by email or hand-delivery, but if not, it is available below, together with Jim Sanger's comments in reply.

Management Committee Proposal for Post Office Local (POL) in Brightwell-cum-Sotwell Community Village Stores Ltd

A number of Members have been responded to individually, however, as many of the questions were being frequently asked by different Members, this composite response is being sent to all Members via their known email address, hand-delivered where necessary and posted on the Village website.

Q1. You state that “the Management Committee is supporting the Post Office Local proposal as a sound business and community venture”. Was this decision unanimous? Please may we see the basis on which you state that it is “.. a sound business …. venture” and the estimated benefits and costs projected. In detail:

A. The committee was quorate and the vote was unanimous. The ‘ sound business venture’ decision was based on the Management Committee’s three year financial comparisons plan available on the village website, and information received from other similar community shops and an independent study commissioned from Plunkett.

Q2.How the estimated “new revenue” is calculated (eg on the basis of the actual revenue generated during the last year by the existing service or a projection for the coming year)

A. The figures provided by the post office were actual revenue less 20%, as is their policy when providing probably income figures. Our three financial comparison plan has been based on a conservative uplift based on the experience of other community shops as in response to Q1above.

Q3.You state that “all paid staff will be required to undertake....POL duties”. How will you cover lunch time when paid staff may not be in the shop and the inevitable holidays and how much is this estimated to cost?

A. In the staffing budget there is always an uplift for overtime and incidental cover as necessary and this includes holiday cover. In the past year we have used this provision on a number of occasions. In addition we so far have three new volunteers willing to be trained for the POL duties.

Q4.You state that the “Post Office … will pay the majority of the improvements required to integrate a Post Office”. What estimates have you received for the cost of these and how much will the Village Stores be required to fund itself?

A. As stated in the original fact sheet the Post Office will invest £10,000 to install all the necessary counter equipment, electrics, and all security equipment and systems. A contingency of £500 has been allocated for any incidental costs the shop may need to meet. Other work such as moving stock and shelves will be done by volunteers and these have already been approached.

Q5.You state that the contract can be terminated without any financial penalty to the shop after eighteen months. Whose responsibility is it to remove the POL technology and to put the shop back into the position it was before? If this is at least partly to fall on the shop, how much is this likely to cost the shop?

A. The Post Office will remove their entire infrastructure free of charge. If the management committee consider there is further changes required, then it is likely to be moving shelves and stock and this will either be undertaken by management committee members and volunteers, or there may be a small cost which the shop will have to meet.

Q6.You state that there are “no up-front stock costs for Post office services”. Will all POL stock, including envelopes etc, be provided on a consignment basis?

A. All stock related to the post office services will be provided at no cost to the shop. The stock remains the property of the post office. Stock is replaced, upon request, within 24 hours.

Q7.Have you calculated the cost of purchasing stock for the “related services” if the POL is not in the shop? If so, how much is it likely to involve and what margin will you receive on the sales of stamps, for instance?

A. The management committee has investigated the provision of items such as stamps etc., and the cost of each these services was included in the fact sheet delivered to every member. If the POL is not in the shop then the Post Office will provide a service elsewhere in the village – there would be no point in competing for these services as margins are low and costs are too high – including an ATM machine. However, this would be reviewed when a decision is reached and the future known.

Q8.The Post Office is now open for a lesser number of hours than the shop. You state that “the PO is committed to providing services in Brightwell“ and mention a mobile van. What other options are there?

A.The shop management committee has the same information as those who attended the open meeting in November. At that meeting the post office said they had a commitment to providing services in Brightwell, and that they would look at how this could be delivered once the decision is reached about the Post Office Local in the shop. They did however indicate that this could be a 10/12 hours service provided by a core postmaster, somewhere in the village. It would be a matter for that core postmaster to negotiate for a venue. The post office has since indicated that this service, albeit not 10/12 hours a week, could be provided by a van which calls into the village, maybe once a week. This is not for the shop management committee it is entirely a matter for the Post Office.

Q9.You state that “more storage space will be required in both scenarios”. Has the cost of this been taken into account in the estimate of the benefits and costs of the proposal? Why will the shop need extra storage space if the POL is not located in the shop?

A . Yes, costs have been taken into account for extra space required. The Post Office counter, stock and equipment, in reality, requires very little space. From the break-even situation to a profitable situation, more general stock will be required. The management committee thought it opportune time to raise this issue with the Village Hall committee that we may be looking for additional space. Space is particularly an issue at Christmas time with extra stock, for a very short period of time, for the Christmas Hampers for the elderly in the village, which the shop sources and packs.

Q10. Please may we know the current estimate of the profit or loss of the shop for the year to 31 December 2015? How much was the cost of interest on the loan and depreciation for the year?

A. See the 3 year financial comparison on the website.

Q11.What was the turnover for 2015 and what is the forecast turnover for 2016 and the gross margins for both years?

A. See the 3 year financial comparison on the website.

Q12.What was the cash in the bank at 31 December 2015?

A. £19,216.04 – cash in hand £2322.42

Q13.How much of the loan is still due to be repaid at 31 December 2015?

A. Current balance outstanding £620.62 – last payment due in March 2016

Q14.What is the value of creditors (apart from the loan) at 31 December 2015?

A. £4,631.36

Q15.What was the value of stock at 31 December 2015?

A. Presently being calculated, will be advised when the figure is to hand.

Q16.The Management Committee has clearly produced a cost benefit analysis of the POL proposal, presumably going forward a number of years. May we please have a summary of this in financial terms and an estimate of the risk involved by way of a high/low analysis?

A. See financial calculation on the website. No risk as there is no cost to the Stores – just commission paid on transactions.

Q17.Is the Post Office still demanding that their counter is located next to the shop counter?

A. Yes, but the current shop counter will retain its current serving length. See new layout plan

Q18.Where are you planning to locate the receiving space for letters and parcels (currently behind the Post Office counter).


A. This has been accounted for in the new layout.

Q19.Where will the extra storage space for POL stock be located?

A. This has been accounted for in the new layout. However there is no need for extra storage space for POL stock as the stock for use can be located to the rear of the post office counter. Re-stocking is on a 24 hour delivery service. Post and Parcels are collected twice a day, morning and afternoon, so no great build up, except for the Christmas period, when alternatives can be found, as necessary. – see Q 9

Q20.Why will the shop without POL require an increased level of stock as stated by the Management Committee?

A. In order to ensure viability there is a need to continually grow the business and footfall. See Q 9

Q21.Have you explored the possibility of having an ATM located in the shop? If so, what are the costs and benefits? If not, is this a service that could be offered by the shop?

A. This has been explored; however ATM machines require certain criteria around security and usage to be met. It is considered the Stores would be unlikely to meet the criteria.

Q22.Will disabled access be demanded by the Post Office? If so, has the cost of this been factored in?

A. The plans which are provided have both taken into account disabled access as required in legislation and by the post office in any provision of a Post Office Local. There are no additional costs involved.

Q23.As previously mentioned, you state that “all paid staff will be required to undertake....POL duties”. What is the attitude of the current paid staff to this?

A. Employment law requires discussions with staff are kept confidential; therefore the Management Committee is unable to answer this question.

Q24.If the current paid staff do not stay, what are your contingency plans and how much have you allowed in your projections for their replacement?

A. This is a confidential item as above. Therefore, the Management Committee will deal with this in a sensitive manner and within budget. However, as the shop’s long term viability is essential we hope that the revenue increase would be a huge incentive for any existing or new paid staff for the longevity of the post.

Q25.You state that “extra volunteer staff is required in both scenarios”. Do you not have enough volunteers at the moment to staff the shop as it stands?

A . We do have volunteer gaps and are actively recruiting, with three new names having been put forward in the past month. However, committee members and fill-in volunteers are often available to fill any gaps and the staff repeatedly assures the Management Committee that they are able to cope if no volunteer is available. We will always continue to recruit and support our highly valued present band of volunteers. Anyone interested in volunteering please contact the shop.

Q26. I think (but don’t know until I have seen the financial detail) that there is an assumption that the co-location of the Post Office in the shop will improve the income of the shop as a one-stop location. Given that the current Post Office is very close it is questionable how much extra income will come for Co-location. It would be helpful to understand this aspect.

A . Evidence from other community shop/POLs proves that bringing footfall into a retail premises to use the P.O. improves the profits of the retail business

Q 27 Providing some detail of the shop design with enough time for people to understand and question it will go a long way to dispel their fears about how the shop will operate.

A. We had a further meeting with the Post Office design expert this week; as soon as he sends the plans through to us we will make them public

Q.28 Comparisons with other shops are useful but they need to be on a like for like basis, in particular, do they work because of their specific staffing arrangements?

A .As above, we have look at models where staffing is mainly volunteer; part paid and part volunteer and, those run entirely by paid staff. All these models run successfully some have adapted over time to meet changes of increased business giving extra profits to meet the business needs.

Q.29 You state that staffing costs will be the same, but given the increased demands and therefore higher staff remuneration, the potential cost of current staff replacements, lunchtime cover it is impossible to understand this without seeing how this has been calculated.

A. There will be no extra staff costs associated with the POL. The Management Committee has made contingency plans. Our staffing budget for the coming year has been increased by inflation. The budget for 2015 had contingency sums to ensure that we could provide paid staff cover in the shop as required. The paid staff will be required to operate the Post Office counter service. At no cost, office support responsibilities would be carried out by the Management Committee. The members of the management committee currently carry out much of the shop office work on a voluntary i.e. Accounts, VAT, Salaries, Bank Payments and Reconciliation, Insurance, Utilities, Maintenance, Marketing, Advertising, general support etc.

Q.30 It would be very helpful to understand what disadvantages the inclusion of the Post Office have been considered and what residual risks remain.

A . We of course have tried hard to find the disadvantages to having a P.O. in the shop. During our extensive research it has proved that any perceived disadvantages around uncertainties that changes brings is soon dispelled when the advantages become a reality in terms of business and community benefit. Even the Post office contract can be reviewed after a year meaning that we are taking out the financial risk to the shop. In terms of disadvantage to staff and volunteers, evidence tells us that with all the support in both training and retail that the Post office provides free of charge, the staff and volunteers benefit by increasing their skill levels, interest and by driving up profits increase job satisfaction.

Jim Sanger has added the following comments to the above:

Questions as a result of the projections circulated by the Management Committee on 29 January 2016.



The Management Committee's projections are largely based on obtaining a 15% increase in sales in 2016 over 2015 (never before achieved), incurring no extra costs as the result of taking in the Post Office Local and restraining the growth in trading expenses to 2.5%. The attached analysis shows how a variation of these assumptions can significantly and adversely alter the outcome by some £6,900 in 2016.

The following questions therefore also arise

  1. The growth in turnover over the last three years has been 0.3%, 5.0% and 0.12%. How does the Management Committee justify the increase of 15% projected for 2016, three times greater than ever achieved before and more than £450 every week? How do they justify the further growth above that level in 2017 and 2018 of 10% and 5%?
  2. Has any allowance been made in salaries for the Government's increase in the minimum wage or for holiday cover or compulsory pensions.
  3. Marketing expenditure has reduced since the last published accounts for 2014 by 39%. If the Management Committee are projecting an increase in sales of 15% in 2016 and further growth in subsequent years, is this reduction in marketing expenditure realistic?
  4. General expenses have reduced by 45% since 2014 and are projected to stay at the low level. Is this justified?
  5. No provision has been made for the hire of storage space, stated as being necessary for the inclusion, at least, of the Post Office Local. How much is this likely to cost? We understand that the Post Offlice was paying £2,160 per year to the Village Hall.
  6. Has any provision been made for the liability for any shortfall in the takings of the Post Office Local which is understood to be the responsibility of the Village Stores?

Questions as a result of the projections circulated by the Management Committee on 29 January 2016.

General questions


In spite of the extensive question and answer document circulated by the Management Committee, there are still a number of questions which need to be clarified if members are to make an informed decision on Tuesday 2 February. The needed clarification to some of the questions (adopting the numbering used by the Management Committee) is detailed below.

Question number

1.What is the quorum for the Management Committee? How many attended the meeting which supported the Post Office Local proposal?

3.How much was included in salaries costs in 2015 for overtime and holiday cover? Does the Management Committee believe that this will be sufficient in 2016 if the Post Office Local is moved into the Village Stores?

4.Has the Management Committee received any quotations for the alterations demanded by the Post Office? If so, how much will the proposed alterations cost?

5.Assuming that the counter will have been moved, the Management Committee may decide that it will need to be moved back to its present position if the contract is terminated in eighteen months time. Will the Post Office cover this? If not, how much is the “small cost which the shop will have to meet”?

7.Where was the cost of the sale of stamps included in the fact sheet already distributed?

9.You state in the fact sheet that “more storage space will be required in both scenarios”. Is the Management Committee now saying that no storage space will be needed for the inclusion of the Post Office Local in the Village Stores?

12 and 14.Creditors at 31 December 2014 were £11,431.72. You state that they are now £4,631.36, a reduction of £6,800.36, presumably paid out of the bank account. Cash at bank and in hand has, however, increased by at least £1,672.87. Where has this additional funding of £8,473.23 come from?

16.Does the Management Committee accept that there is a risk to the Village Stores if there is a shortfall in calculated takings, as has occurred in other Post Office Locals, the responsibilty for which is understood to fall on the Village Stores?

17.If the Post Office Local is moved into the Village Stores, how long will the Village Stores be closed? Has the cost of this in lost revenue been factored in to the projections?

22.Do the plans for the relocation of the counter take into account the need for seating space currently provided for, and needed by, customers of the Post Office?

23 and 24.It is understood that the current paid staff are not in favour of the Post Office Local being moved into the Village Stores. Consequently, there is likely to be the expense of hiring new staff. Has this been allowed for in the projections?

28.As shown on the Village website, feedback from local shops seems to vary with some advising against accepting a Post Office Local. Have the Management Committee been to Marcham, for instance?

29.You have included accountancy services in your projections, does this mean that the Management Committee members will stop carrying out the shop office work on a voluntary basis?

30.You state that “...any perceived disadvantages …. is soon dispelled when the advantages become a reality in terms of business and community benefit”. Why, in that case, are at least two neighbouring shops advising against accepting a Post Office Local?

Jim Sanger

30 January 2016

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