A village shop once hailed by Prince Charles as a shining example of community partnership is facing closure unless new tenants can be found.

The Post Office and Village Stores at Blythburgh, near Southwold, has been run on the site of the White Hart Inn, beside the A12, for the past 10 years.

It was the first business to benefit from The Prince of Wales' Pub is the Hub initiative back in 2001 and the Prince visited the site in 2008 to celebrate its progress.

The pub took on the facilities after the village lost its previous post office and shop. But Sean Lofty, landlord of the White Hart, has served notice to pub owner Adnams on the running of the shop and post office.

He said the shop was 'losing money on a daily basis' and the situation could not continue. He is due to end his tenancy of the shop on September 1. 'When you run a business you provide x amount of stuff – and if people don't buy it it's not feasible,' he said. It's difficult for small shops to compete against the likes of Morrisons and Tesco. People tend to look for the cheapest option, and that's not the local shop.'

Mr Lofty, however, said the pub, which is popular with tourists, continued to do a good trade, with takings up 40pc on last year.

David Tytler, chairman of Blythburgh Parish Council, said: 'It will be a great loss to the village if it does close.

'It hasn't been as used as perhaps it could have been, but it remains very important to many. It has always attracted people from outside the village, from Walberswick and even Halesworth, especially after the closure of their post offices.

'The shop also provides a prescription service and holds prescriptions from Southwold Surgery for villagers to collect. That's an invaluable service and the parish council will, I'm sure, find a way to ensure it continues.'

The parish council, meanwhile, has asked for anyone interested in taking on the business as a community venture to get in contact.