The Imbibe Bar and Restaurant in Mount Maunganui has gone into receivership due to "ongoing trading and cash flow issues".
Monarch (2018) Limited - trading as Imbibe Bar and Restaurant - at 19 Girven Rd neighbouring the Bayfair Shopping Centre went into receivership on March 5.
A sign posted on the door reads: "Imbibe is currently closed due to receivership. The business is for sale."
One of the receivers appointed, Paul Manning from Tauranga BDO, said the business was placed into receivership due to "ongoing trading and cash flow issues".
"The business is closed and we are advertising it for sale as a going concern," he said.
The business includes the bar, restaurant and pokie machines. According to the company's Facebook page, it has been operating since 1999.
Geoffrey Davies and Patricia Roxburgh are listed on the New Zealand Companies Office as the company directors. Both directors have been approached for comment.
The Bay of Plenty Times visited the bar and restaurant todayand a passer-by said it was sad to hear the local pub had closed.
Hospitality New Zealand Bay of Plenty regional manager Alan Sciascia and Tauranga Chamber of Commerce chief executive Matt Cowley both said it would be inappropriate to comment on an individual business.
However, Sciascia said, in general, the hospitality sector was very competitive and operated with small margins.
"In such a market, businesses compete for customers who have choices as to where they spend their dollar," he said.
"In a market with rising costs (increase in the minimum wage), increasing competition (new businesses opening) and a relatively static population, it is difficult for all businesses in that sector."
Matt Cowley said the hospitality sector as a whole was facing increasing costs from suppliers and rents, a shortage of experienced staff and expanding competition.
"The sector is also coming into a difficult time with coronavirus and the anticipated downturn of the shoulder season."
Cowley's advice was to, "Know what you are good at and know your weaknesses".
"Business owners cannot be good at everything and try to do it on their own. There are a range of free or low-cost tools, advice and mentors available to help business owners think differently about their business."
He said it was important for business owners in any industry to remain vigilant with their finances through proper planning and processes, as well as staying aware of industry changes and potential competition.
"A number of successful businesspeople have been through a liquidation or receivership process during their careers," he said.
"Margins are very thin for small businesses and sometimes there is a period of bad luck. Most operators are stronger for the experience and they now know when they need to seek help."
Cowley said it was a nervous time for the hospitality sector that was facing increasing costs to the minimum wage, council rates and user charges, as well as their suppliers pushing up prices.
"The industry as a whole employs a large number of people," he said.