Workers at York's two Sweater Shop stores in Stonegate were today facing an uncertain future after the collapse of the retail firm.

The Leicester-based textile company called in the receivers after a slump in sales which saw losses of £15 million and is now looking for a buyer for its 78 shops. The York shops employ 15 people.

Meanwhile another chain, Racing Green, opened its largest store in the country today in Coney Street, York, and will be taking on 16 permanent staff.

Richard Rees, from Price Waterhouse, the Sweater Shop's receivers, said the shops would continue to trade while a buyer was found and there would be a series of sale promotions to sell off the stock.

"At the moment all of the shops will continue to operate and we have told the retail employees that we have a lot of stock to dispose of," he said.

"The shops will continue to trade while we find a buyer and there will be no redundancies." He said the management at the Sweater Shop had been struggling with a difficult market place for their product for some time and had worked hard to restructure it to put it on a sound footing.

The future of its manufacturing operations in Leicester, Nottingham and Cumnock in Ayrshire is more uncertain.

The Sweater Shop was founded in 1973 and extended into high street retailing in the late 1980s.

Racing Green was set up seven years ago as a mail order company and, with the opening of the Coney Street shop, now has eight branches across the country.A spokeswoman said the York store, formerly Burton's Menswear, was on three floors with an area of 3,600 square feet.

"We think York is a perfect location for Racing Green and we will have a bigger selection here than anywhere else in the country," she said.

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