There are a lot of convenience stores on the market at the moment, and buyers aren’t always convinced that the business is worth the time and labour. If you’re selling up, it’s essential to understand the key factors buyers are looking for when considering purchasing a convenience store, off-license or newsagents.
Running a local shop as a family can be rewarding, but entrepreneurs are usually more interested in profit margins. That said, all buyers are looking for something different and a slower pace of life could be more attractive to some buyers than a busy location and high turnover. Let’s take a look at some important considerations which make a convenience store worth buying.
- Location and local area
As with all businesses, the location of an off-license of convenience store is probably the most significant factor in the decision making process. Physically where the shop is located is important – is it close to where the buyer lives now, are they willing to move – or are they actually looking for a change of location? Secondly, the immediate area around the shop is equally vital. How many residents live in the neighbourhood, how much footfall does the store get? Is there a school, college or community centre nearby which attracts children and parents? Buyers may also want to check out the safety of the neighbourhood too, to see if they would be happy living and working there.
- Potential for profit
The current turnover and financial figures are important, but it’s just as essential for buyers to consider adding extra revenue streams. For example, opening for seven days a week rather than six could boost profits, but it might not be worth the labour costs. Buyers need to assess the potential for introducing different products and services or adding a Post Office counter – things which could bring more people into the store and widen profit margins.
- Regular customer base
Convenience stores are regularly under threat by local supermarket branches and bigger stores which can afford bigger discounts. However, by offering a friendly service and quality products, many people are willing to support local businesses rather than shop elsewhere for a cheaper basket. A dedicated customer base is essential for convenience stores, so this is something buyers may want to witness themselves.
It’s often helpful when selling a business to put yourself in a buyer’s shoes. What would you be looking for before deciding to invest? What future improvements could possibly be made to boost revenue?