Bells ring with sound of profit

FOR SALE: Partly-completed bell tower, asking price $7 million (or near offer), apply R Court, 24th Floor, 197 St George’s Terrace, or phone (08) 9222 9888.

Sound silly? Not really, because over the past few weeks a number of Perth entrepreneurs have spotted a business opportunity which has already led to at least one cash offer being put to the WA Government for its bell tower.

The government is saying nothing about the offer – but it must be interested.

A quick sale before the next election would not only get a political monkey off its back, it would be an astonishingly good deal, potentially returning a neat profit.

A measure of the growing interest in the tower is coming from the tourist industry with visitors demanding a trip to see the bells.

Inclusion of a trip up the tower, or the tug of a bell rope, will become a must when the project is complete.

As someone once said, build it and they will come, creating with the bell tower some very interesting financial calculations.

Start with a similar, but far grander, public structure which sucks in paying guests. The Sydney Harbour Bridge walk.

When first proposed, many laughed. Who would want to walk across the bridge? Answer, thousands.

Today, a walk across the bridge is not only a compulsory part of a Sydney tour, it is a goldmine.

A single mid-week daytime ticket costs $108, nighttime $130. A daytime weekend walk costs $130, at night $150. And they’re paying months in advance.

The bell tower is the bridge, in miniature. A unique modern structure, with history in the form of the bells which for 250 years rang in the New Year from the church of St Martin-in-the-Fields in London’s Trafalgar Square.

Let’s crunch some numbers. Assume a trip up the tower costs $10. At that price it is easy to see 500 visitors a day (about thirty an hour if open day and night) which generates a cash flow of $5,000 a day, or $1.8 million a year from ticket sales alone.

Toss in souvenirs (especially tacky bell tower models), coffee and cake and the $2 million mark is easily reached.

If the true cost of building the tower is $5.5 million then the payback period from cash flow at 500 visitors a day is three years – not bad for a new business.

Be a bit more generous. Toss in a tug of the bells, sign up foreign tour groups, do a bit of promotion, keep the price at $10 and lift the daily visitor numbers to 750.

Annual ticket sales cash flow hits $2.7 million, add a bit for sideline sales to reach $3 million a year and the payback drops to just twenty-two months.

Imagine what happens to numbers if 1,000 a day turn up.

The key to success with the bell tower as a business will lie in the marketing, and an ability to run a business, not the strong points of government.

Sale, or long-term lease, to the private sector is the answer and that sort of deal might not be too far away, unless the Opposition objects to the sale of a State asset (which it didn’t want built in the first place).

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