Grocers Give Reasons For Their Bankruptcy

Press, Volume XCVI, Issue 28322, 6 July 1957, Page 12

Grocers Give Reasons For Their Bankruptcy

An insufficient capital of £l6OO and the taking by customers of uncharged goods during rush hours were quoted as reasons for their bankruptcy by Charles Baldwin, a storekeeper, now employed by the City Council, and his wife, Beryl Iris Baldwin, at a creditors’ meeting yesterday. The debts were incurred in the running of Wroxton Stores, which was bought by the bankrupts on an overdraft of £l6OO guaranteed by men associated with Baldwin in local body affairs. The guarantors were Messrs J. E. Tait, L. G. Amos, H. S. Feast, R. M. Macfarlane, M.P., W. Percival, and J. L. Hay. Debts totalling £1986 5s 8d had been incurred and their assets totalled £892 Is lid, a deficit of £1094 3s 9d. Baldwin claimed that the bankruptcy was caused by lack of business experience, ill advice from two business firms regarding the purchase of the shop, the former owner of which, he said, owed one of the firms more than £lOOO. Insufficient capital, an overhead of £l7 17s 6d a week, 70 per cent, credit sales, goods sold at or below cost price, and goods taken and not charged, were other causes given. Bankrupts’ Statement

Baldwin had started business in February, 1955, against the advice of his wife, the Official Assignee (Mr G. W. Brown), who presided, read from a joint statement from the bankrupts. There was £473 worth of stock in the shop when Baldwin took over, and after a fortnight’s tuition from the retiring owner, a further £250 of goods was purchased. His capital had been insufficient, Baldwin said, for he had not realised that 30 per cent, of the customers would not pay their accounts promptly. Baldwin told Mr Brown that he had gone into business with no assets of his pwn, but his wife had owned a car, which was later sold to pay bills. Later some of the money from the car was used to repurchase stock and equipment which had been seized by the guarantors. “Helped Themselves”

During busy periods customers helped themselves, and it had been difficult to keep track of these purchases. Others took goods home, and when giving details of their purchases, later, forgot to list every item, he said.

“I began business at Wrrxton Stores on March 25, 1955,” Baldwin told Mr Brown. “I kept my own records as best I could, and these were checked occasionally by Nicholls, North, and Nicholls.” A profit and loss account prepared for March 31, 1956, showed a gross profit of £691 and a net profit of £B5. The bank overdraft was £1351 and Baldwin owed sundry creditors £1607. Drawings for the year totalled £553.

Baldwin said that the selling of some stock at cost had contributed to the loss of gross profit Prices had altered often, and without experience he and his wife had been unable to keep up with these. Assignee’s Questions Mr Brown asked Baldwin when he had begun to get into real financial difficulties. Baldwin replied that this had happened in 1956 when they could not pay their accounts because of a £3O monthly repayment of overdraft, to which they were committed. Mr Brown: What did you pay for the business?

Baldwin: £1372, including £5OO goodwill. What summonses were served against you?—Last February H. H. Wauchop, Ltd., W. D. and H. O. Wills, Nestles, Royds Bros., and Kirk, and George Atkinsons sued me. Nearly all my creditors sued. Distress warrants were issued by H. H. Wauchop, W. D. and H. O. Wills and Nestles. I paid Willi and Wauchop; Nestles took goods, an adding machine, and a cash register.

Has there been a private meeting of creditors?—Yes. I was bulldozed into a meeting on December 5 when they wished me to dispose of the business. At the time we were on a cash on delivery basis with all creditors, and I would not agree to the sale. Can you make an offer to the creditors now, personally.—No, only frox.i wages. Earlier during the meeting accounts covering the separate estates had shown that Beryl Baldwin owned furniture valued at £lOO, and Baldwin furniture valued at £BO. There were no liabilities in either case. Baldwin, aged 40, was earning £ll a week from the City Council. The couple had no children.

“You appear to blame everyone but yourself,” Mr Brown said. “No, I accept the responsibility,” Baldwin replied. Guarantors' Position “The guarantors were associated with Baldwin in political life,” said Mr R. P. Thompson. “They were of both sides and one, the Town Clerk, neutral. They acted entirely on good will to Baldwin, and I wish to say that there is nothing sinister in their approach,” he said. Since the Baldwins were adjudged bankrupts on June 21 the business had been conducted for Mr Brown. Accounts had reached £227 9s 7d and, as he was liable to pay bills, Mr Brown was anxious to know his position until the shop was sold. There was very little stock in the shop. Mr A. Amyes, for Royds Bros, and Kirk, suggested that a subcommittee of creditors be appointed to assist the Official Assignee with the conduct of the business. Representatives of two creditors were appointed.