Mr B – Hartlepool

The company was incorporated in 2016 by the director and the start-up costs were self-funded by the Director. The Company ran a public house in the town centre of Hartlepool and relied on the Directors contacts within the industry such event management companies and the local media to grow custom.

The business was turning over in excess of £3,000 per week in the first year and not being tied to any brewery allowed the company to change its lines as and when necessary. The company made vital links with the local college and envisaged them using the bar as an unofficial students Union to hold events however a formal agreement was never reached.

There were certain clauses within the license that added additional overheads that were not required which reduced profit. The council had also begun a regeneration project in the area which significantly reduced footfall. In addition to this, the lease of the unit was assigned to the company when they incorporated and it was identified that a rent review was due to have taken place the previous year. The Director felt that the rent was high but after liaising with the landlord has been unable to reduce this cost.

The high overheads and reduced footfall had an exceptional effect on turnover so the Director reduced the staffing hours significantly, covering most of the shifts himself. The Director did not take any remuneration throughout the 19 months of trading and the long hours were having a drastic effect on his health. The director then suffered a minor heart attack which made him realise that he couldn’t continue and he sought our advice.

Following a review of the company, it was clear that it could not continue as it could not afford to pay the bills as and when they fell due. The company entered liquidation in December 2017 after which the Director took three months off work. The administration of the liquidation was swift and the company was brought to an end. With the liquidation now close, the director is back to full health and currently enjoying his new role within an entertainment company.

If your business is suffering similar problems then we can help. Our professional team are on hand to offer free help and guidance. Enquire today for more information.