Forecourt Trader - 30 years at the heart of the fuel retailing community

Money Talk: Getting into the festive spirit - in the right way

Although we're in the middle of an (unseasonal) election campaign, and there's so much else going on news wise, it's here again Christmas a season that raises a few business issues.

Stock, cash and insurance

First up, stock, cash and insurance. Many forecourts today sell alcohol; some sell lots of it and may not realise just how valuable is the alcohol stock they're carrying at this time of year. It tends to be the big-ticket items whisky, gin, vodka and brandy, not forgetting the sherry, port and more-posh bottles of wine. Even at wholesale prices some of these can be rather expensive, and most retailers will be buying cases, not individual bottles! Remember that this stuff is far more attractive to the criminal element than motor oil or antifreeze. Apart from tasting better, it's easier to sell on, especially at this time of year.

Given the seasonal sales mix, you may well be carrying several thousands of pounds more alcohol stock than at any other time and it's quite likely that there'll still be some of that in store between Christmas and New Year's Eve. Very much the same applies to tobacco. It's no accident that at many times in the past 100 years or so, cigarettes have been more valuable as a currency than bank notes. Even today they're still immensely exchangeable in all sorts of criminal activity and there's no shortage of demand. Two questions that need to be addressed then: is that valuable, attractive stock securely under control? And does your insurance policy cover how much of it you have on the premises?

Of course, if you've got the supply and demand balance right, you'll be converting that stock into sales. Great, well done! Just remember that there are several Bank Holidays coming up and even today you may end up with rather a lot of old-fashioned cash.

Some retailers deal with this by taking their 'banking' home for Christmas or New Year, others leave it on site in the safe.

In either case you need to be sure that the amounts and locations are covered by your insurance policy it's quite probable that any off-site cash may be subject to very restricted cover indeed.

Find your insurance policy schedule; somewhere in the small print will be quite specific limits on the value of tobacco, alcohol and cash that it will cover and the required secure storage conditions for each. The values may come as a bit of a surprise. If they look a bit on the low side, contact your broker to try and raise them to cover what you expect to be carrying before the holiday period.

Staffing and pay rates

The question of who is expected to work during the festive period causes problems on many sites every year. Even where staff are willing to work what, for many, will be unsocial hours, the thorny question of pay rates can still crop up. Quite simply, experienced site operators know that it's usually worth paying a little bit extra ie above normal and even overtime rates if they're asking employees to work Bank Holidays at this time of year. Apart from the fact that some customers can be even more stressed at this time of year, on some forecourts trade can be exceptionally heavy when they are the only places for miles around that are still open.

Yes, it will cost more, but if you manage to staff the place with sufficient numbers of happy employees you may well find that you sell a lot more.

The staff Christmas party

Even though we're used to 'austerity' and many employers have cut back on staff parties and the like, others still like to reward their hard-working staff with an annual bash 'on the company' sometime around now.

We're often asked about the tax and VAT implications of this expenditure (usually after the event) and as with everything related to tax, the detailed rules can be complex.

To keep it as simple as possible, what is 'tax allowable' and 'VAT reclaimable' has to be considered from each angle separately:

To be an 'allowable business expense' the event has to be for your staff NOT suppliers or customers.

To avoid liability as a benefit to individual staff, the entertainment has to be calculated annually ie the total value of events is calculated over the whole year. It has to be open to all employees, although not all have to come; and cost less than £150 per head including VAT (per year).

For the VAT to be reclaimable, the entertainment has to be open to ALL employees. VAT is only re-claimable on costs for staff members not any of their partners who may attend, or other guests.

Want more stories like this in your inbox?

Sign up for our FREE email newsletter

My Account

You are not logged in.
  • Weekly
    Retail
  • Weekly
    wholesale
  • Daily
    Average
Weekly retail fuel prices: 24 February 2020
RegionDieselLPGSuper ULUL
East127.9462.00136.58124.72
East Midlands127.70137.72124.65
London128.12137.79125.20
North East125.92136.20122.89
North West126.8567.57135.95124.01
Northern Ireland124.76130.73121.98
Scotland126.97133.86123.39
South East128.6564.90139.38125.39
South West127.77135.04124.41
Wales126.67135.28123.28
West Midlands127.58140.14124.60
Yorkshire & Humber126.87137.50123.73

Most read

Has the Government's shock announcement to bring forward the ban on the sale of new petrol and diesel-powered vehicles - as well as hybrids - to 2035 or even earlier caused concern and disruption to your future forecourt development plans?

Digital Edition