Mr Woods said before any decision is made to close the business, it would be worthwhile for the receivers to talk to staff about the option of an employee buy-in.

“Research has shown that employee ownership tends to lead to better outcomes for productivity, profitability and longevity,” said Mr Woods.

“In a challenging global economic environment, employee ownership can provide a lifeline to businesses that need an injection of capital and fresh ideas.

“It can mean the difference between closure and unemployment, or successful and sustainable future,” he said.

Mr Woods said it would be critical that the company’s employees accessed expert advice to go through the company’s books to identify the company’s problems, and to identify a business case for taking the company forward.

“These decisions need to be taken carefully, and with access to all available information and advice,” said Mr Woods.

“But when you’re talking about the jobs and livelihoods of 250 people, every alternative needs to be considered.

“Employee ownership is a proven business model that has helped many companies turn around their performance.

“If an employee buy-in can provide a pathway through this company’s present difficulties, then that should be one of the options on the table.”

AEOA aims to create jobs by helping small to medium-sized enterprises to transition to employee ownership and has been awarded a $1.8m Federal Government grant to establish the Australian Employee Buy-out Centre, which is set to commence operation next week.