New stretch target
Now we have hit our minimum target we can continue to accept investment to reduce the amount of debt we will have and have a greater impact in Penicuik. Our offer will remain open until September unless we hit our maximum target of £300,000, however we will continue to draw down payments throughout that period.
Update - Progess and Number of investors
Progress - £82,100+ pledged
Our overall total now stands at over £82,100 when the updated local payments by cash and cheque held in Penicuik and the latest Microgenius pledge updates are added in. So please let everyone know about this who you think might be interested in investing in Penicuik - we have made our minimum target and can now reduce our dependence on a bridging loan between our minimum and aim!
We show the same total here as is shown on our other, main, microgenius community share investment site, but we currently show the full number of on-line investors only on the microgenius page. There are also more off line investors as there are on line investors - the full total is already over 400, largely local, investors.
Penicuik's Future in Your Hands!
How many times have you heard people say Penicuik isn’t what it used to be; that the town centre hasn’t got the shops people want, or that too many people are drawn to Edinburgh? If we keep on saying it, it’ll become a self-fulfilling prophecy and before we know it, it really will be just another satellite of Edinburgh, and all the things that attract people to the town will be gone.
But by contrast, if we dig deep, we can do some-thing about it. We can make the town something we can be in control of, and not a place at the mercy of big money and big developers. It’s been tough for everyone in every retail sector these last few years, but it’s been really tough on the kind of businesses people really want to see in their towns – independent, locally-owned businesses, with proprietors who care as much about the community as you do, because it’s their home too.
We know where those proprietors live – they’re in and around Penicuik already. They’re the people who hold the town dear and want it to thrive.
They’re people like you.
HOW CAN WE DO THIS?
We know that just as shops closing can cause a domino effect as others fail in their wake, the opposite is true, and success can breed success.We want to build on the success of the activities of the Penicuik Community Development Trust’s efforts and the outdoor market and openThe Penicuik Storehouse: a community bakery, café, kitchen, food store and indoor social supermarket as a thriving business in the heart ofPenicuik High Street in one of the old Penicuik Co-operative Buildings.
It will give Penicuik residents and visitors the chance to buy freshly baked bread and cakes, pies and savouries, soups, family meals, cookedmeats and cheeses, tea, coffee, sandwiches, and other food and groceries all from local, organic sources as far as possible, doing this in anattractive place that’s a pleasure to visit, and at the same time giving people real jobs, training and volunteering opportunities.
The Storehouse is committed to giving Penicuik people good food at fair prices, and the wherewithal to feed their families honestly andwell. We’re not planning to take anything out of the local economy, instead we want to put plenty back into the town we love and the local traders who help to support it.
We’ve done the sums and we’re convinced it can thrive, and in so doing helping bring some real life and colour back to the High Street, pullingin people from all around Penicuik. Together we can make this happen.
We plan to open the Storehouse as soon as we can after signing the ten-year lease with Scotmid, the current property owners. We signed the lease just before Christmas 2015 and the lease runs from 25th January 2016. The asbestos ceiling tiles were removed by Scotmid and the building certified safe.
First of all, walls will be stripped out, floors and ramps re-modelled, and the premises thoroughly cleaned. We’ll remove the ugly oversizedsignboard and replace it with something more attractive and discreet. Our intention is to have access from Bank Street, as well asHigh Street.
WHAT IT’LL BE LIKE
People have been missing a bakery (and the unmistakeable smell of freshly baked bread!) for years, so we’re making that a big feature.Bakery preparation will be “front of house” at street level, and behind that we’ll have the café, sales counter, with bread ovens to the right.
The Bakery will be a partnership with Breadshare who started near Penicuik just a few years ago and earlier this year opened a successful newbakery in Portobello (http://breadshare.co.uk/). They’re an established supplier to Penicuik’s Valleyfield House Saturday Market and First Fridaymonthly street market, and we’re running a franchise operation in which their name and brand will be used by us baking the bread with our staff,our raw materials but to Breadshare’s standards.
Behind the bakery and cafe area will be the food Market and Lost Garden Food Hall taking up most of the width of the Storehouse to the back, where the indoor market stalls will be laid out.
On the first floor we will have the Community Shop, more toilets, accessed by two different flights of stairs and we’ll also be adding a lift toensure accessibility throughout. The Community Shop will redistribute surplus food from the supply chain and make it available at heavilydiscounted prices to those living in areas of deprivation and experiencing in-work poverty.
The Penicuik Community Shop will ultimately be run in collaboration and partnership with the Company Shop - Community Shop organisation (http:// community-shop.co.uk/). Critical to any surplus-distributing enterprise like this is having reliable supplies of that surplus, and so the shop won’t open until this is in place.
Costs and Surpluses
We’ve looked at contingencies for start up and future years and we’re confident that our projections are realistic and reliable. The full details are available in the Business Plan which can be downloaded from http://www.penicom.net.• After a first year in which we absorb start up costs, we expect to generate a surplus forcommunity and town centre benefit of at least £30,000 each year.• The total set-up costs, including buying stock, are around £332,100 and after allowing for the Town Centre Communities Capital Grant of £150,000, we have set our optimum share issue aim at £182,100 – with this amount, we can do everything we need to do to open the Storehouse debt free.• We’ve got underwriting from Social Investment Scotland of £100,000, so the minimum we need to raise is £82,100, as we can make up the difference from the SIS loan, though we’d ideally like to raise as much as possible through the share issue, as the more we raise, the less debt we have and the more our money can go to work in Penicuik.• If we’re more successful than that, we can accept up to £300,000 in share capital, with the extra money used to provide both working capital tomake us more resilient as a business, and speed the development of the Community Shop and other aspects of the start-up phase whichhaven’t yet been costed as they weren’t essential. The Board will decide the best usage of the additional capital in light of how much extra has been received.• Our financial projections show - as is the case with all new businesses with significant start-up costs – that we make a loss in year one as weabsorb those one-off costs, moving to a surplus in the second year of operation.• On a month-by-month basis, we believe the Storehouse can cover its operating costs and generate a surplus.• We aim to employ the equivalent of 7 full-time staff at 35 hours per week on a living wage+of £9.90 per hour, which will give us awage bill of around £100,000 per year.
When the Share offer is closed because it has made its aim, on March 31st or before, then the Crowdfunder fee of 5% +VAT is taken and the balance of 95% is drawn down from the holding source - Credit Card (Stripe), Direct Debit (Gocardless) or Paypal into the Penicuik Community Alliance Limited Share Account with your address details and you are registered as a shareholder. If it is closed because the aim has not been made then monies are returned to you.
We have been approved by HMRC for Advanced Assurance that investment in the Alliance will be eligible for Enterprise Investment Scheme Tax Relief.
As we are now an eligible body for EIS undertaking an eligible trade then investors will be able to claim 30% of the value of their investment back against their UK income tax liability.
Anyone investing on the basis of the potential tax break should check with their own financial advisor as to their eligibility and the means by which they will claim it.
WHO’S BEHIND THIS PROJECT?
Penicuik Community Development Trust has a track record of getting things done that make a real impact in Penicuik, and behind The Storehouseare people who’ve been involved in that work.
We began in 2014 to explore the possibility of launching a really high quality low-cost food business. In 2015 we formed The PenicuikCommunity Alliance Limited with a Steering Committee of volunteer directors Colum Beagan, Paul Hayes, and Roger Kelly.
Roger has lived in Penicuik for nearly 40 years and his family connection goes back further. He has had a career in Town Planning andCommunity Development to add to his experience of 25 years of successful operation of the Saturday market in Valleyfield HousePenicuik and his retail experience and supply chain will transfer directly into the Penicuik Storehouse operation.
Colum has associated himself with food culture throughout his life and even during the fifteen years he spent as a Maths teacher he kept agarden and smallholding. He is passionate about good food and passionate too that good food is not just for the well-off. He grew up on a smallfarm and has been involved in the Lost Garden of Penicuik project, and has lived locally for nearly two decades.
Paul has lived in Penicuik for 27 years and has a background from childhood in retail sales and latterly business experience in Quality Assuranceand Business Management Consultancy.
The Steering Committee have also consulted with Archie Patterson, Derek Mair, Melanie Dunbar, Shuna Anderson, Judit Lengyel; with Jill SalesDebra Riddell, Geoff Crowe and the team at Breadshare; with Alasdair Mathers and colleagues at Midlothian Council and with Alistair Johnstoneat Social Investment Scotland. Gary Stott from Company Shop has been inspirational and essential to our investigation of the communityshop - social solidarity store aspect of the project and without his encouragement we could not have proceeded with this vital element.
WHAT ARE COMMUNITY SHARES?
Penicuik Community Alliance Limited (‘The Alliance’ - trading as the ‘Storehouse’) is using a form of investment called Community Shares – it’s ideally suited to community assets like the Storehouse. Investors can expect interest on the sums they invest and may withdraw their investment (in essence, get their money back) but only under certain conditions.
The Alliance must first have the funds to support withdrawal or interest payments and we only ex- pect to make interest payments or accept requests for withdrawal after three years.
Community shares can’t be sold on or transferred (except upon death).
The Storehouse will work if we all pull in the same direction. The Storehouse will always have to ensure that getting money back to investors is prudent, taking into account our objectives as a community benefit society.
So, whilst we have a strong business plan that supports our plans for growth, and a desire to ensure a return to investors who have shown faith in our community, our wider community purpose will always come first.
That provides the final advantage – because it should be seen as a medium to long term investment, it is most attractive to people whoshare our values, rather than want an immediate return, ensuring that the people who will own the Storehouse will be those people who invest on these terms.
WHAT INVESTORS WILL GET?
Every investor will be a part- owner of the Penicuik Community Alliance and gets a stake in the decision-making – for the committee of directors and on resolutions at the AGM (the society’s Rules are available from our website: www.penicom.net).
Under the law governing Community Benefit Societies, regardless of how much you invest, ev- eryone has one vote. We believe that fits our ethos perfectly, because all investors will be equal with everyone else in their desire for our community to prosper, regardless of how much we can afford to invest. The more people can invest, the greater their interest payments will be).
The committee hope to pay interest on share capi- tal, capped at 1.5% in any given year, though for the first three years, interest will not be paid nor withdrawal allowed to enable us to focus on get- ting the Storehouse business in a good condition for long-term growth. From the third year onwards decisions about interest and withdrawals will be made by the Committee at the time. Should withdrawals be possible, they will be allowed on a first come first served basis. Members will be required to give three months’ notice of their request to withdraw capital.
The present Alliance directors judge that the projected performance of the Storehouse business gives them confidence that they will be able to support this rate of interest and enable withdrawal by investors within a relatively short timespan. They believe that this offer represents an excellent opportunity for them to significantly lower the costs of their borrowing as a society, to achieve social benefit to the community of Penicuik and to enable investors to achieve an attractive rate of return better than they can get from cash savings products on offer at high street banks.
About the project
Penicuik Community Alliance has been formed as a Community Benefit Society to create and operate the STOREHOUSE in extensive premises in the centre of town at 22 HIGH STREET and BANK STREET PENICUIK to create and operate daily:
- a BREADSHARE community BAKERY,
- a TEA & COFFEE HOUSE associated with the bakery,
- a STOREHOUSE KITCHEN.
- a GROCERY STORE and cash-and-carry extended from the weekly VH Saturday Foodmarket that has operated at 17 High Street for 26 years supplied by GreenCity Wholefoods and others.
- a LOST GARDEN FOODHALL with fresh produce from the Lost Garden of Penicuik and other local suppliers
- an INDOR MARKET drawing on experience with Penicuik's successful First Friday monthly outdoor Farmers Market
- Beyond Foodbanks SOCIAL SOLIDARITY SUPERMARKET community shop training space and cafe, for referrees only, operated as closely as possible along lines pioneered by Community Shop at Goldthorpe and Lambeth, and related to the work of Company Shop FairShares and the Trussell Trust.
- TRAINING AREAS for events and classes
- a special COMMUNITY SPACE for events and classes
The Storehouse is in the former Penicik Co-operative Association Food Supermarket and Warehouse, more recently trading as Nickel and Dime.
It will be carefully refitted as an attraction for citizens and visitors alike, with a primary focus on local food and an emphasis on good value. The project will provide real local employment, with volunteer and training opportunities and important links with local schools, local traders, and community organisations. It is intended to use renewable energy from the Lost Garden and woodlands around Penicuik for part of the Storehouse heating and baking.
£150,000 has been made available to the Storehouse Project for capital works from the Scottish Government's Town Centre Communiies Capital Fund to be used alongside money raised from this community share issue. This share issue will also provide working capital.
More details are set out in the Shares Invitation to buy. The project and its supporters are outlined in the Shares Leaflet and fuller details of the operations are given in the Business Plan, all can be seen and downloaded from here.
Risk Warning Funding pitches through Crowdfunder.co.uk carries some risk. There is no guarantee for members making donations that any reward offered will be delivered. Equally, when members invest in community shares the capital they invest is at risk and they may not get back what they put in. Rewards based crowdfunding and the sale of community shares are not regulated by the Financial Conduct Authority, nor covered by the Financial Services Compensation Scheme. Click here to read more about the risks.