help needed with meaning of quoting rent/service charge/rateable value/rents payable?

**dancingbutterfly**

Hi guys:wave:


I am in need of basic small business advice.

I have been thinking about setting up a small kiosk in my local busy shopping centre selling cosmetics and related paraphernalia!

I have enquired about availability and costings and have recieved a spreadsheet detailing costs. However i do not understand whats what and i am having trouble finding out how much i'll pay and for what!

sorry i understand this is all basic stuff i just dont know it yet!

So, the spreadsheet of the unit im interest looks like this;


Quoting rent= £7,000
Service charge= £822.69
Rateable value=£4,750
Rents payable= £1,967

I would be extremely greatful to anyone that can help explain these numbers for me! :T

db x

Gertie_Walker

These figures mean that the total cost of renting the unit will be 7000+ 822.69+ 1967 = £9790. On top of this you will need to pay for insurance and utilities, so you need to take a view as to whether your takings would cover this and give you a profit.
I think that you need to go and see Businesslink if you are having trouble at this basic level.

**dancingbutterfly**

Gertie_Walker wrote: »

These figures mean that the total cost of renting the unit will be 7000+ 822.69+ 1967 = £9790. On top of this you will need to pay for insurance and utilities, so you need to take a view as to whether your takings would cover this and give you a profit.
I think that you need to go and see Businesslink if you are having trouble at this basic level.

Thankyou for your helpful reply Gertie.


I think im ok with most other aspects of running your own business it just these values/rates etc i didnt know, untill now. I will definately see a businesslink advisor though!

thankyou again for your help.

paulwf

Remember there will be VAT to pay on the rent and service charge. This isn't a problem if you are VAT registered of course.

The service charge covers things like security and cleaning for the shopping centre...nice things to have but the charge is likely to be way higher than if you were paying for them on your own. It does include bins though which is nice as normal business rates don't include this.

Watch out for any clauses such as advertising fees for the centre which will be in addition. You might also need to use approved contractors and services which cost more, and getting deliveries from the loading bay to you may be a pain. The centre might also specify your opening hours, so you can't open extra when you want plus you might have to stay open when you'd rather close.

Basically there is lots to think about it, please take professional advice before you proceed too far.

**dancingbutterfly**

paulwf wrote: »

Remember there will be VAT to pay on the rent and service charge. This isn't a problem if you are VAT registered of course.

The service charge covers things like security and cleaning for the shopping centre...nice things to have but the charge is likely to be way higher than if you were paying for them on your own. It does include bins though which is nice as normal business rates don't include this.

Watch out for any clauses such as advertising fees for the centre which will be in addition. You might also need to use approved contractors and services which cost more, and getting deliveries from the loading bay to you may be a pain. The centre might also specify your opening hours, so you can't open extra when you want plus you might have to stay open when you'd rather close.

Basically there is lots to think about it, please take professional advice before you proceed too far.

Hi paulwf,


thanks very much for your advice. It is greatly appreciated!

I think its too expensive for me, im quite disheartened about it but im sure i'll find something appropriate in the end.

It'll cost roughly £200 per week to rent, id like to think i'll make enough to pay it, but not much left over.

Id do it at my local booming sunday market but they have a trader that does a lot of makeup and fragrances etc.

thanks again

db

Owain_Moneysaver

**dancingbutterfly** wrote: »

Id do it at my local booming sunday market but they have a trader that does a lot of makeup and fragrances etc.

Is there sufficient demand for a second trader in a similar field, and would you be competing on price or could you offer different brands etc?

**dancingbutterfly**

Owain_Moneysaver wrote: »

Is there sufficient demand for a second trader in a similar field, and would you be competing on price or could you offer different brands etc?

Hi Owain,

thanks for your reply.

Id never thought about it like that! The other trader has a massive plethora of brands, and his prices are probably a bit more than id charge and his stall also looks very shabby, there's no pos or anything just baskets of makeup shoved on a table. For example the perfume boxes he's had for a while i think as the boxes are very battered and torn.

His demeanor (sp?)/customer interaction isnt great either, ive been waiting to pay for something before and he's been too busy talking to some old floozy , he knew i was waiting but chose to ignore me so i put the product back and walked away.

So i feel i could definately 'out do him' (dont mean that in a nasty way!) in presentation/customer service/display/signage. but he'd have more brands for sale, i could probably match it, but not beat it.

What do you think??


Edit! oh also i have a basic qualification in makeup consultancy and can do makeovers this may be an advantage point??

paulwf

**dancingbutterfly** wrote: »

Hi paulwf,


thanks very much for your advice. It is greatly appreciated!

I think its too expensive for me, im quite disheartened about it but im sure i'll find something appropriate in the end.

It'll cost roughly £200 per week to rent, id like to think i'll make enough to pay it, but not much left over.

Id do it at my local booming sunday market but they have a trader that does a lot of makeup and fragrances etc.

thanks again

db

Please don't be disheartened, shopping centres charge silly figures. £10K would get you a reasonable sized shop in a position fairly close to a town centre...sure a shopping centre will be busier but I wouldn't pay that just for a stall. I'm sure if you look around there are far better premises.

Having a market stall sounds perfect though as it is low risk as you aren't tied into a long lease...if it doesn't work out you just discount your stock then walk away. Don't be put off by other traders and don't think you have to be the cheapest...in fact for perfumes etc creating a good customer experience is just as important as the price, perhaps even more so.

**dancingbutterfly**

Thanks paul,

i will keep looking and see whats around the town. I dont need much space at all really so hopefully i should find something!

The sunday market is fab, loads of people attend every week of all ages i agree it would be great i just wonder what the other 'makeup person' will say/do? also i wonder if the organisers have rules in place where only one trader per niche (makeup/watches) they will allow? although theres always lots of clothe stalls and toilettries so maybe its fine!

thankyou again

db

Savvy_Sue

**dancingbutterfly** wrote: »

also i wonder if the organisers have rules in place where only one trader per niche (makeup/watches) they will allow? although theres always lots of clothe stalls and toilettries so maybe its fine!

Only one way to find out ... you might find useful information from the National Market Traders Federation, I think they offer deals on insurance etc.

**dancingbutterfly**

thanks savvy will check it out!