The boss of a Sheffield city centre restaurant, bar and brewery declared insolvent with debts of £1 million has taken to Facebook to explain the venue's "severe difficulties" in a frank video.
Alex Barlow, owner and founder of the Sentinel Brewhouse in Shoreham Street, has revealed that unexpected building costs and a batch of stolen beer had contributed to the bar entering into a Company Voluntary Agreement - which means the venue will stay open and continue trading while talks are held with creditors in a bid to sort out its finances.
In the clip, posted on the bar's Facebook page and which you can see HERE Mr Barlow said: "We find ourselves in a really difficult situation, a situation that none of us ever thought we'd be in or wanted to be in.
"Everyone who has ever founded a business of their own will know that it's not easy. It's not easy getting through your first year of trading. We found that first year very stretching - more so than we'd ever imagined."
Sentinel has called in city accountants Graywoods to sort out the situation after the bar, which only opened in a former carpet showroom last summer, revealed the extent of its financial problems.
Added Mr Barlow in the clip: "Our budget for building the place was significantly exceeded - three times the initial quotations. And we had other difficulties - 80% of our first batches of bottled beers were stolen, causing massive interruption to our sales plans and cash flows, all of which has given us some severe difficulties."
Mr Barlow said that the venue, which brews its own beer on the premises, had created 20 jobs and he said: "That's why we are trying to continue. We believe we've got the core of a really, really good business here.
"I don't want to let my team down, I want to keep them employed. We hope you really believe in us and thanks for all our customers for standing by us.
""With your support, we have a positive future. We hope to be seeing you soon."
A spokesman for Graywoods said: "It was decided that a Company Voluntary Arrangement would be the most appropriate option to allow the company to continue trading whilst addressing their debts.
"A CVA is a formal procedure which enables a company which is insolvent, yet has a good underlying business, to make a proposal to its creditors that they accept a distribution in full and final satisfaction of their debts, so as to secure the company’s continued survival."
In order for the CVA to become binding on creditors, it must be approved by 75 per cent or more of creditors, voting on the resolution to accept or reject the CVA.
A virtual meeting of creditors has been called for 10am on June 27 to consider the proposal.
Creditors requiring further details should contact Danielle Lockwood of Graywoods on 0114 2859500.