North East Bakery has folded with "nearly all" its 120 staff made redundant only days before Christmas.
The Newcastle-based firm, run by entrepreneur Greg Phillips, went into administration on 22 December after costly rebranding plans and "a disappointing trading performance" in recent months saw the firm’s liquidity hit hard. Phillips was unavailable for comment.
The administrator Pricewater-houseCoopers (PWC) said it is looking to sell the business and assets of the company, comprising a 20,000sq ft bakery in Newburn, Newcastle upon Tyne and 13 retail units, for the benefit of creditors. "On appointment almost all of the company’s 120 employees were made redundant," said the administrators, with a limited number kept on to assist PWC realise the sale.
The firm was established by Phillips former North East Young Business Person of the Year and former director Andrew Cotterell in 2004, from the buy-out of Chapel Bakery and Patisserie. It later acquired assets from Milligans Bakery of 15 shops and its Newburn bakery in 2007.
In August 2009, British Baker reported on North East Bakery’s plans to grow its Nichols brand, with the opening of two new shops by 2010. At this time it had a turnover of approximately £3.4m a year and around 30% of its business was wholesale. As British Baker went to press it had been reported that bakery and coffee shop firm Milligans, which leased a number of outlets to North East Bakery, has safeguarded the jobs of its 200 staff by transferring its business to a new holding company. The Milligans business currently comprises 13 coffee shops, three bakeries and a butcher’s.
MD Stephen Milligan was quoted on nebusiness.co.uk as saying, "Sites that were originally leased from us, have now reverted back to us as fixed overheads. We have had to transfer the assets of the business to a new vehicle to protect us from liabilities." Liabilities were said to be in the region of £300,000 a year.