After 38 years in business, Fashion Star Inc., a Carroll County maker of women’s apparel, has filed Chapter 7 bankruptcy, forcing it to lay off all 70 of its employees and liquidate its assets.

“We just lost business over the years,” Fashion Star Chairman Robert Loftin said. “It was my family’s business so it was a tough decision to make because we put a lot of money into it. I did everything I could do but it just wasn’t enough.”

Loftin said the company, which provided high-end uniforms and business suits for women, trimmed its work force in early 2009 in an effort to cut costs.

“We had a cutback at the beginning of 2009 to save the business and keep moving forward,” he said. “After May there were no major layoffs. If an employee retired or found another job, we simply didn’t replace them.”

During the past year, the company eliminated more than 30 jobs including many executive positions, but scaling back couldn’t save the business, Loftin said, since Fashion Star was losing clients too quickly.

“It had been slow for a while,” Becky Mashburn, a Fashion Star employee for 38 years, said. “Everybody there knew how bad the textile business had gotten.”

The company, located in the Lowell community, had employed about 150 people and had sales of approximately $8 million in 2000. But business began a slow decline and by 2009 the company saw its sales plummet to $2.2 million, Loftin said.

“For the past five to seven years we’ve seen a decline,” Loftin said. “Especially the last two years we really struggled.”

Fashion Star’s primary customer base was small independent banks, according to Loftin, who ordered the suits for their employees.

“The larger banks started buying the smaller banks,” Loftin said. “And the clothing was a benefit to employees so it was one of the first things to go.”

Loftin said those companies who still use the upscale uniforms now turn to larger department stores for the clothing. “It’s going to be a tough industry. We had a couple of competitors but they were always smaller than we were,” Loftin said. “Now employers are buying more casual apparel from places like JC Penney.”

Daniel Jackson, the president and CEO of Carroll Tomorrow and head of the Carroll County Chamber of Commerce, said the job losses will be felt by the community.

“Any number is a big number,” Jackson said. “Certainly 70 jobs is significant.”

Mashburn, who was the operations manager, said employees were not angry with the company when it announced its closing.

“When the employees came by to get their last checks we all shed some tears and promised to stay in touch,” Mashburn said. “Nobody had any hard feelings, we know they did everything they could to keep from having to close.”

Loftin took over the chairmanship of the company in 1990 when Fashion Star was supplying more than 3,000 companies with women’s suits.

In 1998, the company purchased one of its smaller competitors and experienced a short-lived growth spurt, but by 2000, the client list had dropped to 2,800 companies.

The amount of business Fashion Star generated steadily decreased, hitting the 2,500 mark in 2003 and by the time the company filed bankruptcy on Jan. 8, less than 800 of the original 3,000 clients remained, according to Loftin.

Since the January closing, Mashburn said she has seen a number of fellow ex-employees at the Department of Labor seeking jobs.

“A lot of us were at the unemployment office at the same time,” she said. “I’ll be drawing unemployment for the first time. It’s really strange. There were a number of people who worked there for 30 plus years and some from the sewing room were there for over 25 years.”

Loftin said there is a possibility part of the company could survive, but any plans will be put on hold until after the bankruptcy hearing in early March.

“You have to do what you have to do,” Loftin said.