“The majority” of the company’s workforce is to be made redundant, it has been announced, after administrators were called in to the Townsley Street premises last week.
Managing director Michael Flynn said that, with nothing substantial in the order book, there was no other choice than to take this action.
He said the situation was brought about due to the introduction of the 5p bag charge, introduced in England last October, and overseas competition.
Nelson had been operating in the recycled LDPE (polyethylene) re-usable carrier bags sector. It has been making carrier bags for more than 30 years. The company was acquired by Intelipac, a UK producer and distributer of retail bags, in 2013.
Flynn said: “We had thought we were ready for the bag tax but it has been far, far more challenging than we expected.
“We wanted to bring the manufacturing back to Britain and we wanted to generate support of British retailers to jump on board with that.
“While the Co-op, Asda and Pets at Home did that, for many others it is still all about price, and I’m afraid we just couldn’t compete with overseas imports.
Forty workers have reportedly been made redundant.