A two-year campaign by volunteers to save their village store and post office looks set to end in failure.

Residents of Farnhill and Kildwick had hoped to buy the combined shop and post office when owner Michael Hilton announced his plans to sell up and retire, fearing the business was not viable.

A group of villagers decided to 'save' the business by raising enough cash to buy and run it themselves.

They formed a co-operative - the Farnhill and Kildwick Post Office and Village Shop Association - which raised money and received cash pledges from residents of both villages.

The Association made an offer in the summer of 2000 for the property, based on their own independent valuation.

But Mr Hilton, who had said he would sell for £100,000 in November 1999, turned it down saying it was "£20,000 below" what he had asked for.

He now feels the business is no longer viable because of increasing competition from supermarkets and petrol stations in Cross Hills and the surrounding area. He said: "It's like everything else. If people don't use it they lose it.

"I've had a lot of very loyal customers but people who come into the village now don't support the shop at all. We just can't go on anymore."

He said he felt the property would sell better as two houses and has submitted plans to Craven District Council. But Gary McHugh, of the Association, believes the business will be an immense loss to the villages and particularly elderly residents. He said: "We've been inundated by people wondering what we're going to do. We feel very aggrieved after doing an awful lot of work to raise funds."

But Craven District planning officer Richard Preston said there was evidence the business had lost a lot of trade over the years and was no longer viable.

He felt the only thing likely to hamper planning permission would be a lack of off-street parking.