Plans to flatten the former Plough Inn, at the junction of Pope Lane and Cop Lane - which operated as the Shampan Restaurant for its final decade - have been recommended for approval by South Ribble Council after being deferred last month.
Councillors sent the application back for more talks between the owners and planning officers over deliveries, parking and an exrtaction system for a proposed hot food takeaway.
The matter will go before the planning committee again on Thursday with the outstanding issues resolved.
But nearby residents are still unhappy with the scheme, even though it removes a building which is considered to be an eyesore and a fire risk.
The 64-year-old property, built in 1957 on the site of an earlier Plough Inn dating back to at least the 1840s, has been empty since the Shampan shut its doors in May 2019.
At that time the manager Alam Hussain said he had wanted to buy the building to continue as a restaurant, but was told it was not for sale. Seven months later it was sold for £395,000.
New owner Dharmesh Chandarama has applied to bulldoze the property and replace it with a single storey building to house a convenience store, a takeaway and two more retail units.
The plans raised concerns by residents over deliveries on Sundays and the size of delivery vehicles negotiating the site. After talks between the owner and the council the size of wagons permitted has been reduced to a maximum of 26 tonnes.
On the issue of Sunday deliveries residents objected but were told shops had to be able to take delivery of goods to maintain stocks. The proposed delivery hours on Sundays have now been scaled back from 9am-7pm to 9am-5pm.
The hours of use for the extractor system at the proposed takeaway have similarly been reduced from 7am-11pm to 10am-11pm.
And on customer parking, LCC's highways department has said it does not object to a reduction in the number of spaces from when it was a pub and a restaurant.
Letters of opposition by neighbours cited the building being "out of scale" with its surroundings and the proposed metal cladding on the new building being "out of character" with the area. Penwortham Town Council also objected.
There were also issues of overlooking and a loss of privacy, insufficient off-street parking, the potential for noise and odours and the possibility of anti-social behaviour associated with the takeaway.
Letters received in favour of the new development said it would remove a "dirty, badly-lit site attracting crime," an eyesore and a fire risk.