a businessman nicknamed "Tinsel Tommy" after manufacturing tinsel for nearly 30 years has closed his factory because of competition from the Far East.

Just before Christmas, Tom Baker made 17 of his remaining 20 staff at the Creative Christmas Company factory in Langley Park, Durham, redundant.

At the peak of its success three years ago, the company employed 40 people, had a £2m turnover and supplied 7.5 million metres of festive tinsel a year to high street stores, including Matalan, Woolworths and Poundstretcher.

Creative Christmas made a quarter of the £25m of tinsel sold in shops each year in the UK, and was the only large-scale tinsel manufacturer in England.

It has stopped manufacturing and will become an importing operation.

The company has been importing festive Santa and elf outfits, and from now on will import tinsel instead of making it.

Mr Baker said: "It is very disappointing for us.

"It actually costs the same to make tinsel in this country and supply it to major retailers as it does to make tinsel in China and ship it over here.

"But the exchange rate is in favour of the Chinese, meaning it is cheaper for retailers to buy from them.

"This is the reason we have had to stop manufacturing.

"Many of the staff have worked with me for years and it was difficult having to let them go."

Mr Baker started in the tinsel business in 1978 at his family company in Bedfordshire. In 1990, the company moved to County Durham, but shortly after the move, it went out of business.

He bought the company's assets and started the Creative Christmas Company ten years ago.

Despite success in the past few years, turnover began to fall.

Mr Baker said: "We couldn't even get appointments with national retailers to put our case, because they just assumed China was always cheaper."

The company, which now has only three staff, is moving from a 30,000sq ft factory on the Riverside industrial estate to a smaller unit on the same estate.

In November, the Daily Mail reported that tinsel was falling out of fashion, with sales at Woolworths plummeting by more than 75 per cent in the past five years.