Middlesbrough-based Riverside Bakery has gone into administration, leaving 35 jobs in the balance.
Accountant Baker Tilly has been appointed administrator and hopes to sell the business as a growing concern.
The firm has traded as a wholesale baker of bread buns for 25 years, supplying schools, colleges, sandwich shops and other food retailers.
Joint administrator Mark Ranson said the bakery had found the current economic conditions increasingly difficult.
"However, we are optimistic about selling the business as a going concern and safeguarding jobs." he added. "In addition to being well-established, the bakery has a strong reputation across the north east and, in recent years, has invested in modern production facilities.”