More high profile industry casualties are likely, warn experts

Insolvency experts are predicting a sharp rise in the number of pub and bar operators going under in the coming months.

The warning comes as trading across much of the licensed sector continues to suffer under the pressures of rising energy, employment and raw material costs, and as consumers rein in their spending in an economy which shows little sign of improvement.

Craig Livesey, who was part of the team at accountants PricewaterhouseCoopers (PwC) which dealt with the recent Cains Beer Company administration, said it was an unfortunate fact his firm was seeing more work as companies foundered.

"What is surprising us is the speed with which things for some companies are turning sour," he said.

Meanwhile, concerns that some companies which went into administration were being bought back by former management were understandable, said Clive Lewis, head of Small & Medium Enterprises at the Institute of Chartered Accountants of England & Wales.

"It can seem like rough justice to some, but a lot of genuine businesses get caught up in bad times and deserve a second chance," he said.

The pub industry fears the potential for yet more high profile casualties in the wake of the collapse of operators such as Bar Sport, Sports Café and most recently Liverpool brewer Cains. Although such businesses are often picked up by privately-funded companies looking for opportunities to buy at the bottom of the market, observers fear there is more to come.

One high-end bar operator said last week he thought there was "no cause for optimism in the high street at the moment". He predicted that January next year would be a make or break month for many in the sector.

Shares in listed pubcos continued to be rocked by fears of further bad news. Punch Taverns' shares fell 15 per cent at the start of last week before rallying briefly, while Enterprise Inns' stock fell eight per cent, before also seeing a slight uplift.