Provence pub company goes under
Controversial pub company Provence has closed down after its managed division, Countrywide Inns, racked up huge losses.
Provence failed in a last-minute appeal to its banks to provide cash to pay rent to investors that is due tomorrow.
On Tuesday nobody was answering the 'phones at Provence.
Some Provence lessees have reported visits from bailiffs looking to recover money after the company missed payments to landlords last month.
Sources report that Provence has returned company cars and laid off most of its senior staff.
Some observers believe that when it ceased trading Provence had as many as 90 of its pubs closed - which was making finding the money to pay investors even harder.
The situation just did not stack up. It was just so unprofessional Morning Advertiser source.
Provence's managed arm has been running an estimated 60 former tenanted pubs as managed pubs this year. Countrywide Inns, which is run by Provence founder Paul Kiely's brother Peter, is rumoured to have been losing around £360,000 per month.
Provence decided to run some of its pubs as managed houses after it was unable to find lessees for them.
Trade observers thought the move was ill-advised in the extreme since takings were often low at many of the outlets.
One source told the Morning Advertiser: "A lot of the managed pubs were taking just £1,000 or £1,500 per week - a number were losing in the region of £8,000 or £9,000 a month and one was losing £15,000 a month.
"The situation just did not stack up. It was just so unprofessional. Managers were being paid between £200 and £250 a week.
"They wanted to succeed but didn't have a chance. Many people will be on the street."
The source added: "I think Provence tried to run a managed division for reasons of ego. The management's know-ledge of the industry wasn't good enough.
"Management wanted instant results but you can't make a pub take £10,000-a-week just like that.
"Some of the stock results were unbelievably bad - pubs could lose up to £1,500 in some months. It was impossible to know whether it was down to theft, drinks being given away or what.
"The main reason was there were no management systems or control."
Clare Grice, who was running the Queen Victoria in Thorpe St Peter, near Wain-fleet, Lincolnshire, which was taking just £800 a week, said: "The pub was in a terrible state when I arrived after the previous tenant left in a hurry."
Paul Newsham is running the Rose and Crown near Sandbach, Cheshire.
He said: "We've got kids and we'll staying here until there is court action to force us out - or we find another pub.
"This is the strangest company I've ever worked for - I've had six area managers since Easter."
Provence was founded in 2000 and specialises in selling freehold pubs at auction.
A survey in the MA last week revealed that Provence has raised around £70m at the auction market.
For more on the collapse of Provence see this week's Morning Advertiser.
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