THE entire workforce at Scotland's oldest carpet manufacturer was made redundant yesterday after the receiver conceded defeat in his attempts to secure a buyer.

Stoddard International said 179 production staff would lose their jobs. The company blamed the fall in demand on customers moving towards cheaper, less patterned products and the growing popularity of wooden and laminate flooring.

The 168-year-old Kilmarnock company, which made the red carpet on which the Queen walked down the aisle on her wedding day, employed a total of 479 people, 266 of whom were made redundant in mid January.

It is thought the company collapsed with debts of about pounds-9m while it was said to be losing pounds-100,000 a week.

A small number of sales and finishing staff will remain at the factory for four weeks to complete orders from current stocks.

The announcement followed a period of intensive negotiations during which the receiver tried to secure a viable future for the business.

However, discussions ended when levels of funding required to acquire and trade the business in the long term could not be secured. A previous preferred bidder withdrew its interest two weeks ago.

Tom Burton, of the receivers Ernst & Young, said that "no stone was left unturned" as they sought to secure the future of the company. He added: "A lot of people have put a great deal of time and effort into trying to save this business.

"There is a lot of goodwill towards Stoddard in the community and the industry but other major economic factors such as the chronic overcapacity in the UK carpet manufacturing sector, exacerbated by severe competitive pressure from overseas manufacturers, inhibited the possibility of a viable long-term survival plan.

"Despite our best efforts and the support of creditors and customers, we have been unable to find a buyer for Stoddard."

He added that with the business losing money week by week it was not economic to continue trading.

"We have no option other than to wind down operations and cease manufacturing here in Kilmarnock. We must now focus on realising the maximum return for creditors of the business through the sale of the company's assets."

Staff were notified yesterday that they were no longer required with immediate effect.

Des Browne, the local MP, said: "It is extremely disappointing and sad, especially at a time when we have otherwise seen a real improvement in the local economy generally. We will now turn our attention to providing what support we can to the employees who now must be very worried about the future."

Margaret Jamieson MSP added: "We are calling on the minister for enterprise and lifelong learning to come to Kilmarnock and meet us to find a way of ensuring that, locally, we recover from this devastating blow."

Stoddard was granted the royal warrant in 1966 and sold its carpets to the Scottish Parliament, stately homes, embassies, royal palaces, the White House and the Kremlin.

It also made three carpet designs for the film Titanic.

It closed a weaving factory and its headquarters in Elderslie in the past year in a move that consolidated operations at one site in Kilmarnock. It was, however, forced into receivership in January.

The closure comes two weeks after the textiles firm Victoria blamed cheap foreign imports and changing consumer tastes for its decision to stop making Axminster carpets at its base in Kidderminster, Worcestershire.