Help save unit3sixty skatepark

by Gav Pardoe in Stourbridge, England, United Kingdom

Not quite
Unfortunately this project was not successful.

Let us raise enough funds to relocate unit3sixty and thus future proof this amazing facility

by Gav Pardoe in Stourbridge, England, United Kingdom

unit3sixty is a 22000sqft indoor skatepark located in Stourbridge DY8

unit3sixty has created 7 jobs for the area and is open 7 days a week

Operating as a social enterprise and constituted as a Community Interest Company we work to provide a safe and secure indoor environment where the freestyle sports of BMX, skateboarding, scooter riding and both inline and quad skating can take place.

All of the capital build costs have thus far been raised through grant funding applications but unfortunately we are now facing closure due to the local authorities allowing multi-national fast food outlets to open directly opposite.

We need to future proof this amazing community facility and so we are working with local MPs and Councillors to put pressure on Dudley council to find unit3sixty an alternative venue.

One of our recent posts on FB had a reach of over 60k - imagine if every one of those people donated just £1 then unit3sixty would be able to continue at its current location during the forthcoming autumn and winter and well into spring of 2019 giving us time to find and secure an alternative premise in which to rehouse the majority of our amazing skatepark and continue providing You with a decent local !

  • It was in 2006 when working in a senior position in the fire service that you came up with the idea of opening a skate park in your local community after seeing the demise of the only one in your area (fundamentally due to the development of the Tesco’s superstore in Stourbridge who have built on the old site).
  • Having written a business plan and having this fully reviewed you set about raising the funds to make this a reality.
  • After several successful funding rounds and achieving substantial assistance from people who shared your vision, you secured premises and the funding.
  • Since then, you have overcome significant setbacks including but not exclusive to –
    • You wisely put the building and installation of the ramps to tender to choose the provider who you felt you could work with, that would do a good job and stick to time scales.
    • Charity bank also insisted that they had an input into who you used for the build as they were partially funding this part of the project. They encouraged you to use the installations company you eventually partnered with.
    • At the same time, you negotiated a 6-month rent free period on your new lease. This should have given you a full 2-month trading period where rent would not be due.
    • However, the build went well over the time allowed and originally agreed. To add to your distress the contractor walked off site, sighting that you had mis-led them in respect to the size of the project, leaving the project ¾ finished.
    • Not to be perturbed, you opened the facility two months late and started to gain a good client base and a great local following.
    • Before long, it became apparent that you would need to complete the build as the remaining site was both dangerous and your reputation was at risk.
    • You therefore set about on a further funding round to facilitate this.
    • In the meantime, your ramp fitters felt that they had a case to start legal action against you although they had reneged on their contract. Defending this cost you a further £10,000 in excess of the start-up budget with a 50%/50% blame/liability eventually decided.
  • On top of this, you received some very poor advice and financial reporting from your first accountant Folkes Worton who you later learned was inappropriately qualified to deal with you correctly. This led to another large and unpredicted financial outlay when you were suddenly presented with a large VAT and PAYE bill of over £38k that you were not expecting.
    • In retrospect, you should have been advised to delay VAT registration until you hit the threshold as much of the work you were having done was partially exempt and your income would be similar.
    • You immediately switched to work with Adrian Grainger from Griffiths and Pegg who had to go back to your start date to untangle all the errors and re-do the accounts to date. Although the charges for this work were kept as low as possible and Adrian offered a generous discount due to your C.I.C status and relationship, this was also money not forecasted for.
    • It is apparent from our conversation with Adrian that due to partial exclusion your VAT situation is complicated and he’s ongoing advice is to deregister.
  • Both you and Serena have worked extremely hard, overcome significant set-backs, taken the bare minimum out of the business and invested both personally and through family.

You currently find yourselves in the following situation-

  • Cashflow is eroded.
  • The seasonality of the business is causing further strain.
  • You are struggling to meet your current obligations as they become due.
  • You have run out of cash.
  • Online computer gaming has seen a lot of your once loyal young customer base selling their equipment to help fund their addiction.
  • Your minibus has been written off by an unknown person in a stolen vehicle meaning you can no longer provide roardtrips to other UK skateparks.
    • It is clear from what we discussed that the main reason for the erosion of your cash-flow is due to the recent arrival of large multi-national corporates in the area, mainly KFC and McDonalds who have severely hampered your trade on the food and drinks side of your business.
    • Serena has reported a reduction in taking from £15k per month to £4k per month over the last 15-months. This is evidenced by the fact that many families turn up with cartons and wrappers from these outlets and try to eat them on the premises.
    • You were also a handy location for many truck and delivery drivers in the area who used your facilities for various meals throughout the day, this trade has also been transferred to these multi-national corporate outlets.
    • You are constantly burdened with picking up and disposing of litter from these outlets in your carparking area.
    • You are concerned about your young people going across to these outlets as you are aware of a high level of violence around the locations.
    • It is noted that your rent for the unit is extremely high and is over ¼ of your total income per annum.
  • However, with all this said you are currently –
    • Maintaining your loan repayments.
    • Up to date with your rent.
    • Up to date with the Time to Pay agreement with HMRC, which is nearly cleared.
    • Maintaining a high service level and providing a quality experience for all your clients.

The immediate issue for the business –

  • Due to all the issues already mentioned, the business is struggling to raise adequate funds to maintain the above.
  • You are in your quiet season and expect to remain so until September when the nights start to draw in and the weather deteriorates.
  • You have approached the Landlord and asked them if you could use the some of the original deposit (bond) to cover the rent over this period.

In summary

The business was proceeding well within its natural life-cycle with anticipated losses in the first year massively reducing in the second. Your third year of trading was forecasted to make a profit and would have done if the trade through the café had remained the same. This is largely due to the arrival of the large Multi-national food outlets in the area.

You provide a vital service to the children and young people in the area, not to mention their parents. You keep them off the streets, mentored and safe.

Small wheeled sports are recognised as an Olympic Sport and will feature in the next games, therefore facilities such as yours are vital to the success of these in the coming years as natural talent is found and nurtured.

Children are encouraged to get active and have a hobby. You provide an opportunity for them to do this in a safe environment.

Young people will continue to skateboard and skate. Should the opportunity to do this in a safe environment disappear, they are likely to take to the street and do this activity in a dangerous area and manner.

Over and above the actions you have already taken, it is apparent that you need urgent assistance from the Local Authority to compensate you for the decision to allow the multi-national to establish in the area. You originally had a loan of £40k from Dudley CEF to pay for the bond on the premises. This is fully repaid. It would help greatly if they were to lend the same sum again on the same or similar terms.

Although there could be business finance available for you, these lenders would be in the sub-prime market and security would be expected. This would significantly increase your personal liabilities under this arrangement and potentially cause you more financial stress should the business struggle further or fail, I would therefore advise that you consider this very carefully before embarking up on it.

Once secure, you will need to revisit your business plan and work out details of how you are going to have a viable future considering the trade to the café is probably permanently reduced. The plans you have to make your premises a more flexible and attractive location for non-skaters will assist with this. Either a crowdfund or fundraiser to raise funds to convert the foam pit to a rubber lined starter ramp to allow beginners, physically disabled or team builds for corporate customers is planned growth area and should give you another dimension. I am very happy to sit down with you again soon and build on this.

I acknowledge your note to the council, sent by email after our meeting yesterday and would like to be kept in the loop in respect to their response. It is worth noting at this point that failure to assist may result in some considerable negative press for them.


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