Devon town Axminster was hammered by a blow today when its historic carpet maker hit cash trouble threatening hundreds of jobs.
Axminster Carpets, which has been in business since 1755, said it continued to trade while it explored "all potential rescue/restructuring options."
It confirmed a "notice of intention to appoint administrators has been filed" to provide the company and creditors with a moratorium during which "various rescue options being explored can continue."
Many locals say the manufacturer is the heart of the town with one local businessperson describing the news as an "earthquake."
There are 400 workers at the Axminster plant but the company also owns and runs Buckfast Spinning Company and the Buckfast Mill Carpet Centre in Buckfastleigh where there are scores of workers.
Director Joshua Dutfield said: "Trading has been difficult and the management has been working with key suppliers, creditors and the lenders in an attempt to resolve the company's financial difficulties.
"We continue to be committed to working to achieve the best possible outcome for all concerned and most importantly the staff and suppliers."
Chairman of the South West Local Enterprise Partnership Tim Jones said local people hoped a "white knight" might ride to the firm's rescue - "this is earthquake territory in terms of the shock on the local area."
The company's carpets can be found in large residences, hotels and even train carriages and aircraft.
It began when weaver Thomas Whitty decided to give a midsummer event a miss and try his hand at making a carpet instead.