Liquidation advice for pubs and breweries

When there’s an economic downturn, pubs and other hospitality businesses tend to be among the hardest hit. People have less disposable income, so meals and drinks out become takeaways and entertaining at home, and that does nothing for your bottom line. 

If your pub is struggling financially and you’re considering calling last orders for good, you must seek advice. Our licensed Insolvency Practitioners will assess your financial position and explore every avenue for rescuing your public house. If we find that it’s time to call it a night, we can help you liquidate your business while meeting your legal duties as a company director and protecting your creditors’ rights.  

Why are pubs struggling to survive?

Pubs and breweries are disappearing at an alarming rate. Soaring energy costs, the cost of living crisis and low consumer confidence are all taking their toll. The pandemic was also devastating for the industry, and many pubs have never been able to get properly back on track. 

While some publicans are moving to smaller venues to escape the rising costs or reducing the variety of drinks they offer, for many, it’s simply not enough. Spiralling costs are driving the pint of beer to over £7 in some cities, but at the same time, customers are tightening their belts. The inevitable result is that pubs are closing, communities are without hubs and meeting places, and rural areas are losing vital employers.

If your pub is struggling to make ends meet, seeking professional advice early on is vital. It might be possible to restructure or streamline your business or negotiate an agreement with your creditors about the repayment of your debts. Alternatively, if your pub is no longer viable, Company Liquidation could be in the best interests of you and your creditors.  

Liquidation advice for pubs and breweries

If your pub has debts it cannot pay, it’s insolvent. Once your pub is insolvent, you cannot simply continue trading in the hope that the situation will resolve itself. If you do, you risk creating larger debts and leaving your creditors (the parties you owe money to) further out of pocket, and that could give rise to accusations of wrongful trading.  

Instead, you should contact a licensed insolvency practitioner immediately. They will explore options to save your business. However, if your pub is no longer profitable, closing it via a Creditors’ Voluntary Liquidation (CVL) could be the best option. 

An Insolvency Practitioner will act as the liquidator and take control of the business. They will sell the assets of the pub and use the money they raise to repay your creditors. They will then strike the pub off the Companies House register any debts it cannot repay will be written off. Under normal circumstances, you will not be personally liable for any of the pub’s debts.   

One of the main benefits of a Creditors’ Voluntary Liquidation is that as a company director, you could be entitled to claim redundancy pay. That can be a five-figure sum that provides financial security while you get back on your feet. 

Business rescue options for your pub

Just because your business is struggling financially, it doesn’t necessarily mean you have to liquidate. Pub owners are certainly no strangers to a downturn, and with the right help and a sound business model, it could be possible to turn your situation around.  

We might be able to help you secure short-term funding to give you the cash boost you need. Alternatively, if you’re facing relentless pressure from your creditors and threats of legal action, a Company Voluntary Arrangement (CVA) could give you more time to pay what you owe. Another avenue to explore is Company Administration, which would give you the breathing space to restructure your business so you can continue with the profitable parts.  

Need advice?

If your pub is struggling, you don’t need to go through it alone. We provide free initial advice so you can better understand your options and start to take back control. Contact our team for a free, same-day consultation or arrange an in-person meeting at one of our offices throughout the UK.