Transformation to Artisan Bakery - St Michael & All Angels Church Brampton Abbotts, Herefordshire
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St Michael & All Angels Church Brampton Abbotts, Herefordshire Transformation to Artisan Bakery BUSINESS PLAN 2017
The Daily Bread
THE PROJECT HISTORY
• To transform St Michaels Church Brampton Abbotts (Grade 2* listed) into a Year Events
multi-use building to create:
2011 Church closes due to lack of a congregation
• An artisan bakery and coffee shop: “The Daily Bread” (“the Business”)
• A community area that can be used by local residents and visitors 2012 Brampton Abbotts Church Regeneration Group (“BACRG”) formed to
investigate potential uses for the church, develop support for the project
• A place with regular public access for personal meditation and prayer with and promote the regeneration of the village of Brampton Abbotts
public worship taking place at least six times a year
2013 Options appraisal led by BACRG setting out a range of uses for the church:
• Option 1: Microbrewery
• St Michaels has been closed to the public since 2011. The condition of the
church is deteriorating. The project will: • Option 2: Artisan bakery
• Option 3: Restaurant
• Save this medieval church from falling into a non-recoverable state of • Option 4: Events venue
disrepair • Option 5: Biomass Facility
• Option 6: Accommodation pods
• To breathe life into a rural community by creating a hub to the village
2015 Two consultation events held with key stakeholders (the local community,
Diocese of Hereford, the Church Commissioners, The Churches
Conservation Trust) which result in Artisan Bakery being selected
2015 Business plan and financial model developed by BACRG
2016 Circa £250k funding secured from Heritage Lottery
2016 RRA architects appointed and project planning initiated
THE DAILY BREAD 2
The Daily Bread
OBJECTIVES Church objectives
Commercial Objectives • Access will be available for members of the public to the chancel for prayer
and contemplation
• The key objective is to create a viable space that can be used by businesses
who will pay rent to BACRG. BACRG will use this income to maintain the • The church will hold at least six services a year, and these will be planned in
church, thus saving this valuable medieval church advance and consented by the incumbent and the Bishop
• Any surplus income that BACRG receives will be used for community events • Design should allow for use of the community as well as the commercial
and initiatives enterprise
The main business that will use the space is an artisan wholesale bakery: Community Objectives
The Daily Bread. The church renovation must therefore be able to be used
to:
• To provide a much needed hub for the village and surrounding area
• To enable a staff of circa 5 operate the bakery on full and/ or part time
basis
• To host coffee mornings and evening events i.e. pizza evenings that could
• The bakery is predominantly wholesale i.e. delivering finished goods to potentially by paired up with music/ cultural events
local businesses, plus a retail element of a coffee shop for community
events and for customers to use when collecting their bread/ cakes
and to attract tourists/ walkers to the church • To be play a role within the wider community by (for example) working with
local schools to run baking sessions, to act as a hub for artisan, food-based
• To enable the bakery to run baking courses of up to 10 delegates markets, to promote the region’s reputation for quality food and drink
• To be able to seat up to 30 in the coffee shop
• That the bakery can be used for wider commercial kitchen uses i.e. • To save an important and much loved building
pop-up restaurant
• To provide a venue that could be used for regional events and festivals
such as the Borderline Film Festival and h.Art (Herefordshire Art) week
THE DAILY BREAD 3
The Daily Bread
CORPORATE STRUCTURE
maintenance and community
All profit used for building
BACRG
• BACRG is a Community Interest Company. It is limited by guarantee
initiatives
• The directors of BACRG are all local residents – summary biographies are
overleaf
• BACRG’s objectives are to generate income which will be used to preserve
and maintain the church and to create a social hub for the village. BACRG’s
Articles of Association state: ‘The Company is not established or conducted
for private gain: any surplus or assets are used principally for the benefit of
the community.’
Lease for bakery & option for
• Income will be generated through leasing the church to businesses. It is BACRG
other businesses
Income for BACRG
envisaged that the anchor tenant will be the company that runs the bakery,
but BACRG will retain the option to rent space to other businesses on a
flexible basis i.e. ‘pop-up’ restaurants, food/ drink/ craft retailers etc.
• BACRG is effectively, therefore, a landlord that will lease the church to
businesses that are viable and that meet the social and operating
requirements of BACRG (see later in this document) Optional: other
Anchor Tenant –
businesses renting
The Daily Bread
on flexible basis
THE DAILY BREAD 4
The Daily Bread
BACRG DIRECTORS
Who is responsible for the running of BACRG?
• The directors are local residents who have a vested interest in saving the church and making the project a success. They are summarised below:
Stuart Fraser Jo Pilkington Tom McCarthy Janet Fraser Oliver Marshall Sue Marshall
• Founder and owner of • Founder and co-owner • Director and co-owner • Janet is retired and • Director and co-owner • Founder and co-owner
Avail Vehicle Contracts of Mad Dogs & Vintage of Odyssey Corporate was previously of the Woodlands of the Woodlands
Ltd, a vehicle leasing Vans, a glamping site Finance registrar of births, Nursery Group Nursery Group
business based in Brampton • Tom advises on marriages and deaths • Oli is responsible for • Sue founded this
• Stuart has run the Abbots mergers, acquisitions, for the local area the running of the successful childcare
business for 40 years, • Jo leads the business management buy-outs • Janet’s expertise is in group’s nurseries with business over 30 years
leading a team of up to with a particular and fundraising information a particular focus on ago and has been
35 people strength in marketing • Tom’s skills include management and building development responsible form
• Stuart has strong and public relations financial modelling, accounts and project making it the leading
leadership and sales structuring and management independent nursery
experience negotiating deals business in
Herefordshire
Combined expertise in: strategy, sales, marketing, finance, project management, property, negotiation and purchasing built over years
of running successful businesses
THE DAILY BREAD 5
The Daily Bread
OWNERSHIP How will the Owners of The Daily Bread be identified? (continued)
Who will run The Daily Bread? • BACRG will provide information packs to interested parties summarising
the opportunity including:
• The Daily Bread will be owned and operated by a third party: BACRG
envisage a single entrepreneur or group of entrepreneurs running the
Business • Details on the local area
• Financial commitments including rent
• It is envisaged that The Daily Bread will be a limited company although
other trading entities will be considered • Key ‘Code of Conduct’ of operation i.e. to comply with low noise/
disruption to the village and that usage of the building is sympathetic
How will the Owners of The Daily Bread be identified? to its historical and cultural importance
• BACRG will run a national tender with the winning bidder being selected to • Based on the above, BACRG will request initial plans and financial details
run The Daily Bread (“the Owner”) from interested applicants
• The artisan bread community is strong with good communication, • A shortlist of applicants will be made by BACRG and the successful shortlist
particularly through social media. Key organisations such as the will be interviewed by the BACRG committee
www.realbreadcampaign.org will be used to market the opportunity to run
The Daily Bread • A winner will be selected
• Local and national press will also be contacted to help generate interest in • Heads of Terms will be agreed between BACRG and the winning applicant
the project with full legal documentation to be agreed between the parties before the
winning applicant takes over the running of the Business
• It is envisaged that the winning applicant will initially take ownership of The
Daily Bread for a 3 year period with an opportunity to extend the
agreement at the end of this period subject to agreement between the
parties
THE DAILY BREAD 6
The Daily Bread
FUNDING
• The project to transform St Michaels is subject to securing grant funding
• BACRG have applied for initial funding through the Heritage Lottery Fund Grants for Places of Worship (“G-Pow”) scheme: https://www.hlf.org.uk/looking-
funding/our-grant-programmes/grants-places-worship-england
• There are two elements to the project which are summarised in the table, below:
Project Name Notes Estimated Budget Status
Structural Repairs To make the church £262k Initial approval with further assessments to be
structurally sound made through 2017
The Daily Bread To transform the ‘shell’ of BACRG aim to raise circa £300k through further BACRG to raise funds following on from expected
the church into The Daily funding applications positive response to the G-Pow application
Bread
THE DAILY BREAD 7
The Daily Bread
INITIAL DESIGNS
• Based on the initial assessment and planning by RRA Architects, BACRG are proceeding on the basis of
the designs, right and below:
• The bakery will be placed at the Western end of the nave along with storage accessed via steps to
mezzanine level
• A presentation/ display area will be in front of the baking area. This will be used for displaying retail
items and for demonstrations during baking courses
• The remainder of the nave will be for mixed use: seating for the café when the bakery hosts coffee
mornings/ evening events, space for worship/ seminars/ community events
• The Chancel at the Eastern end of the church will be used for occasional worship
• The Vestry will house the toilets with additional seating space
THE DAILY BREAD 8
The Daily Bread
INITIAL DESIGNS
• The diagram, right, summarises the intended usage of the
church and surrounding grounds
• The car park is owned by the Herefordshire Diocese. This area
is critical to the success of The Daily Bread for both logistics
purpose (goods in/ goods out) and for occasional use for
revenue generating exercises such as food / craft markets
• BACRG are working with the Diocese to agree the transfer of
ownership of the car park to BACRG so that it can be included in
The Daily Bread project
THE DAILY BREAD 9
The Daily Bread
The Market
Nationally Craft Bakery Association Locally • There are circa 23,500 residents in the Ross-on-Wye locality
UK Forecast sales for
2014-2019: • The table below shows the number of businesses with local primary
trading addresses that are potential customers of The Daily Bread
Artisanal bread: £683- (Source: FAME database, Bureau van Dijk using UK SIC Codes to identify
£781m the chosen sectors)
Artisanal cakes: £786m -
£823m Herefordshire Worcestershire Gloucestershire Monmouthshire
Artisanal pastries: £179m
- £205m Bread & Cake Retailers 10 16 29 3
Circa 4,500 craft bakeries Accommodation * 90 162 235 26
nationwide Pubs 71 197 217 39
Between 2009 and 2013, Restaurants 102 428 522 76
more than 10,000
children in over 120 273 803 1003 144
schools in England
learned to bake thanks to • Accommodation includes Hotels, Holiday & Other Short Stay
the Real Bread’s businesses, Camping Sites and Other Accommodation as defined by UK
Campaign's Lessons in SIC Codes
Loaf™
THE DAILY BREAD 10The Daily Bread
The Market
• In addition to the businesses listed on the previous page,
there are regular farmers’ markets, with Herefordshire’s Location Frequency
Locally events listed in the table, right: Hereford Weekly on a Thursday, monthly on 1st Saturday
• Ledbury Food Group, a local organization that ‘helps you Ross-on-Wye Monthly
discover the local ‘heroes’ who produce our food’, identify 15
bakers across Herefordshire as shown in the diagram, below Leominster Monthly
right
Belmont Monthly
• The businesses are small scale independents with just one
based within 5 miles of Brampton Abbotts Ledbury Monthly
• Details of the individual bakers can be seen at:
http://www.ledburyfoodgroup.org/bakers-baked-goods/
• Based on the above research, BACRG believe that the local
businesses and residents provide ample opportunity to
create a successful, thriving artisan bakery
THE DAILY BREAD 11The Daily Bread
Risks
• The table below summarises the key risks to the Project along with mitigation of those risks:
Risk Mitigation
The Daily Bread Fails • A rigorous selection process will be used to try to ensure that only top quality candidates are granted the
opportunity to run The Daily Bread
• Food, drink and hospitality are a key part of Herefordshire’s economy. There are a large number of customers for
the owners of The Daily Bread to target with few artisan bakeries in the immediate region
• The Daily Bread is assumed to be the anchor tenant but the lease agreement will be drafted so that BACRG has the
right to rent the space to other businesses when not being used by The Daily Bread
• If the Business does fail, the pod design ensures that the church can be used for other uses which widens the
market for new tenants
Disruption to Brampton Abbotts • The Daily Bread is not a large-scale business. Traffic in the village is envisaged to be impacted but only to the extent
of additional Transit/ Sprinter type vans using the roads, not articulated lorries. The vans used will be significantly
smaller than the farm machinery that currently uses the roads around Brampton Abbotts
• BACRG will work with the wider community to define a Code of Conduct (including, for example, noise levels,
environmental practice, hours of operation etc.) which will be a key part of the legal agreement between BACRG
and the tenants. Drafting will be such that tenants will face penalties and ultimately termination of the lease if they
do not comply with the Code of Conduct.
No suitable Owners are found to run The • The space is deliberately designed to be multi-purpose. Alternative uses will be proposed, thus widening the pool
Daily Bread for potential candidates/ types of business
The church is not structurally viable • BACRG have taken professional advice from RRA and are undertaking all of the necessary surveys and assessments
THE DAILY BREAD 12The Daily Bread
REQUIREMENTS
The Bakery Items
• The Bakery will be fitted out as part of the internal works of The Daily Bread Mixer Coffee Machine
project. The fit out will include items, as listed in the Appendices:
Architect’s Summary, so that the space can be used for commercial baking
and cooking Ovens Small items
• The owners of The Daily Bread will be required to purchase their own Provers Contingency
specific baking machinery. We assume that the items listed in the table,
right, will be required. These items are included in The Daily Bread financial
model later in this document
• The estimated cost of the items above is circa £20k and is excluded from the total
• As with the overall design, a key element is flexibility: it is intended that fundraise package
the bakery will be the main user of the space but care must be taken to
ensure that: • Contingency costs are built into the financial model summarised later in this
document
• If the Bakery were to fail that the equipment provided can be used for
other food-based businesses
• That if the Bakery tenant does not want to renew at the end of the
lease, and a suitable successor cannot be found that the equipment
provided can be used for other food-based businesses
• That the space can be used for other food-based businesses during the
tenure of anchor tenant. This will enable the church to be used for
other revenue generating projects which could include: pizza evenings,
pop-up restaurants, films or concerts
THE DAILY BREAD 13The Daily Bread
Summary of the BACRG Financial Model (continued)
FINANCIALS
• It is assumed that the Owner of The Daily Bread will work in the Business
Summary of the BACRG Financial Model and will initially employ one other person
• BACRG’s responsibility is to ensure that the church is maintained and • The investment that the Owner will need to make is in funding the
preserved operation of the Business in its early phase in terms of acquiring the
necessary equipment and providing working capital
• As such, BACRG aims to create a workspace that allows entrepreneurs to
run a commercially viable business which will pay rent to BACRG • The financial model assumes that the Owner will invest £25k into the
business and will secure hire purchase facilities for the necessary
equipment
• BACRG have produced a financial model which assesses the:
• These funds will be used to pay trade creditors, salaries and taxes until the
• Potential revenues and type of revenues Business itself is cash generative
• Forecast costs, both direct and indirect • The model assumes three main forms of revenue:
• Ongoing capital expenditure • Bread sales based on a wholesale model
• It should be noted that BACRG is not responsible for how the Owners of • Bread making courses
The Daily Bread (or additional tenants) will run their business, nor is it
responsible for the success of failure of the business • Events
• The forecasts summarised in this document are therefore indicative only • Cost of Sales has been assumed at 15% based on comparative research of
other small scale bakeries
and should not be interpreted as being the definitive forecasts or
performance of The Daily Bread • Rent payable to BACRG is assumed to be £12k per annum
THE DAILY BREAD 14The Daily Bread
Summary of the BACRG Financial Profit and Loss Year 1 Year 2 Year 3 Wholesale Retail Courses
£ £ £
Model (continued) Revenue
Sales 83,100 126,911 156,814
• The tables, right, summarise the Balance Sheet Year 1 Year 2 Year 3
Profit and Loss and Balance Sheet 83,100 126,911 156,814 £ £ £
for the first three years of trading Cost of sales Fixed assets
along with a breakdown of revenue Gross purchases 12,153 17,734 22,224 15,120 Tangible fixed assets 21,363 17,425 13,188
streams Current assets
Trade debtors 7,524 7,926 10,159
Gross profit 70,947 109,177 134,590
Cash at bank 4,503 17,512 41,841
85% 86% 86%
• The figures used as assumptions i.e. Overheads 12,027 25,438 52,000
insurance, IT expenses etc. are Wages 36,000 46,350 57,289
14,280 40,102
Current liabilities
Trade creditors 5,631 5,871 6,543
indicative: it will be the Rent 12,000 12,000 12,000 PAYE/NIC 900 1,159 1,432
responsibility of the Daily Bread’s Rates 6,000 6,000 6,000 VAT
Corporation tax
2,451
(2,459)
2,884
(122)
3,663
4,115
Owner to create their own business Utilities 5,000 5,150 5,305
6,523 9,792 15,752
Insurance 1,500 1,545 1,591
plan and to manage the finances of Maintenance (Machinery) 1,000 1,030 1,061
33,372
the Business Telephone 500 515 530
Net current assets 5,504 15,646 36,248
IT Expenses 750 773 796 4,500 Total assets less current liabilities 26,866 33,071 49,435
• Rent is assumed to be £12k per Distribution 5,000 6,750 8,400
Long term liabilities
annum: there is some flexibility in Marketing 5,000 5,150 5,305
21,600 Hire Purchase 13,000 9,750 6,500
Accountancy 1,000 1,030 1,061
this figure in that BACRG understand Sundry expenses 5,000 5,150 5,305 13,000 9,750 6,500
the maintenance costs for the Depreciation 5,138 5,438 5,738 101,59
Church to be somewhere between 2
Net assets 13,866 23,321 42,935
78,750 91,443 104,641
£7k and £12k per annum 79,259 Capital and reserves
Ordinary Shares 25,000 25,000 25,000
• No dividends are assumed in the EBT (7,803)
-9%
17,734
14%
29,948
19%
57,000 Profit and loss account (11,134) (1,679) 17,935
first three years but, again, this will Shareholders' funds 13,866 23,321 42,935
be the decision of the Owner. The HP Interest 652 506 360
financial model indicates that there
would be surplus cash available for Dividends - - -
dividend payments Corporation Tax 2,459 (2,336) (4,237) YEAR 1 YEAR 2 YEAR 3
Post Tax Profits (4,692) 15,904 26,071
THE DAILY BREAD 15The Daily Bread
Summary of the BACRG Financial Model (continued) Summary of the BACRG Financial Model
(continued)
• Cashflow is summarised in the chart below. The cash balance is at its lowest point is June 2020 – assuming a January
2020 start to the Business • Cashflow could be eased by a number of
measures:
• The cash balance is prior to any dividend that the Owner may choose to make
• It is assumed that the Owner will pay
themselves an £18k per annum salary
Monthly Closing Cash Forecast and that they will draw this from the
start of trading. It could be that the
50,000 Owner delays these payments initially
45,000 and then makes catch up payments
40,000 • BACRG could allow a rent holiday
35,000 during the initial phases of the
30,000
Business’ development
25,000 • An additional member of staff is
assumed to be employed from the
20,000
start of the Business: this position
15,000 could be phased in at a later date
10,000 • Assuming that the Business generates
5,000 good quality wholesale customers, the
- Owner could secure invoice
Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov discounting to assist with cashflow
2020 2020 2020 2020 2020 2020 2021 2021 2021 2021 2021 2021 2022 2022 2022 2022 2022 2022
THE DAILY BREAD 16The Daily Bread
APPENDICES
Architect’s Costings Summary
£ £ 300,000.00 Contract Value 100% £ / sqm Rates £ £ 300,000.00 Contract Value 100% £ / sqm Rates
1 Enabling Works 7 External Works
Opening up and removal £ 1,000.00 item Signage £ 750.00 item
Scaffold hoarding £ 3,000.00 item Footway lighting £ 2,500.00 item
Clearance of debris £ 500.00 item Landscaping £ 4,500.00 item
Temporary works onsite £ 500.00 item Carpark surface and marking £ 30,000.00 item
Enabling Sub Total £ 5,000.00 Sewer connections £ 6,500.00 item
2 Sub Structural BWCW £ 4,500.00 10%
Archaeology £ 3,500.00 item External Works Sub Total £ 48,750.00
Services Trenches £ 5,500.00 item 8 Prelims Overheads £ 30,000.00 10.0%
Foundations / lintels £ 2,500.00 item
BWCW £ 1,150.00 10% 9 Sub Total 1 to 9 £ 223,340.00
Structure Sub Total £ 12,650.00
3 Super Structure 10 Fees / All Consultants £ 32,700.00 Architect, Struct.Eng, QS
Structural Framing £ 11,000.00 £ 45.00
Ceiling structure £ 2,500.00 £ 45.00 11 Sub Total 9 to 10 £ 256,040.00
Floor structure £ 6,500.00 £ 65.00
Internal walls / Doors £ 1,400.00 item 12 VAT £ 51,208.00 20%
Staircase £ 4,500.00 item
External Doors / Gates £ 1,500.00 item 13 Project Total £ 307,248.00
BWCW £ 2,740.00 10%
Structure Sub Total £ 30,140.00 14 Quinnquennial Works £ 262,000.00 Grant Funding
4 Internal Finishes
Wall finishes £ 23,000.00 £ 350.00 15 Grand Total £ 569,248.00
Floor Finishes £ 8,500.00 £ 85.00
Ceiling Finishes £ 1,000.00 £ 65.00
Trims and edgings £ 1,500.00 item
BWCW £ 3,400.00 10%
Finishes Sub Total £ 37,400.00
5 Fittings & Furnishings
Ironmongery £ 750.00 item
Light fittings £ 3,500.00 item
Bakery fitout £ 10,000.00 item
Alarm / door counter system £ 2,000.00 item
WC sanitary access pack £ 3,000.00 item
Signage £ 750.00 item
Furniture £ 8,000.00 item
BWCW £ 2,800.00 10%
Fittings Sub Total £ 30,800.00
6 Services
M&E £ 7,500.00 item
Plumbing £ 2,500.00 item
Underfloor Heating £ 4,500.00 item
Trading Services Systems £ 1,500.00 item
Utilities connections £ 6,500.00 item
Gas boiler £ 3,500.00 item
BWCW £ 2,600.00 10%
Services Sub Total £ 28,600.00
THE DAILY BREAD 17The Daily Bread
APPENDICES
BACRG Financial Summary
• The tables summarise BACRG’s income and expenditure based on rent received from The Daily Bread and expected maintenance costs of £8k per annum which
increases with inflation
• It is assumed that in addition to the annual maintenance charge, capital expenditure will be needed in Year 3. An assumed £2.5k is used in this example, but as shown
from the Cashflow table, BACRG will have surplus cash at this stage which could either be used for further capital expenditure/ repairs or using for community events/
projects
Profit & Loss Year 1 Year 2 Year 3 Cashflow Year 1 Year 2 Year 3
Income
Receipts 12,000 12,000 12,000
The Daily Bread 12,000 12,000 12,000
Others
Total Income 12,000 12,000 12,000
Payments
Suppliers 8,750 9,013 9,283
Repairs & Maintenance 8,000 8,240 8,487 VAT 1,750 1,803 1,857
Accountancy & Professional 750 773 796 VAT Recovery - (1,750) (1,803)
Grant Income - Property (15,929) (15,929) (15,929) Capital expenditure - - 2,500
Grant Income - Plant (6,810) (6,810) (6,810) Corporation Tax - 618 1,129
Depreciation 22,739 19,784 17,261
Cash inflow/(outflow) 1,500 2,318 (966)
EBT 3,250 5,942 8,195
Opening bank 6 1,506 3,824
Tax 618 1,129 1,434
Post Tax Profits 2,633 4,813 6,761 Closing bank 1,506 3,824 2,857
THE DAILY BREAD 18The Daily Bread
APPENDICES
Balance Sheet Opening Balances Year 1 Year 2 Year 3
BACRG Financial Summary
Fixed Assets
• The fixed assets are calculated using the architect’s costings as summarised Property Depreciation (15,929) (14,336) (12,902)
Plant & Equipment Depreciation (6,810) (5,448) (4,358)
earlier in the Appendices
Additions - - 2,500
Fixed Asset Value Property 159,290 143,361 129,025 116,122
Fixed Asset Value Plant & Equipment 34,050 27,240 21,792 17,434
193,340 170,601 150,817 136,056
Current Assets
Trade Debtors - - - -
Grant - Property 159,290 159,290 159,290 159,290
Grant - Plant 34,050 34,050 34,050 34,050
Cash 6 1,506 3,824 2,857
Current Liabilities
Trade Creditors - - - -
VAT (1,750) (1,803) (1,857)
Deferred Income - Property 159,290 143,361 127,432 111,503
Deferred Income - Plant 34,050 27,240 20,430 13,620
Corporation tax 618 1,129 1,434
Net Current Assets 6 25,378 49,975 71,497
Net Assets 193,346 195,979 200,792 207,553
Capital and reserves
Ordinary Shares 6 6 6 6
Revaluation Reserve 193,340 193,340 193,340 193,340
Profit and loss account - 2,633 7,446 14,207
Shareholders' funds 193,346 195,979 200,792 207,553
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