11 jobs lost as Telford online bed giant closes after collapse of City Link

The company has blamed the collapse of courier firm City Link, which had a contract to deliver its beds, for the crisis.

Monsterbeds managing director Daniel King said that the company would fulfil its obligations to around 400 customers across Britain who had outstanding orders, saying they would either receive their beds or have their cash refunded.

The company is one of Britain's biggest online retailers of bedroom furniture.

Today, its head office at based at Queensway Business Park was locked up, although Mr King said customers would still be able to contact him by email.

Mr King, who founded the business with his father Donald seven years ago, said he was doing everything he could to save the business, but had been left with no choice but to stop taking new orders.

He said the collapse of City Link on Christmas Eve had left him unable to deliver his orders, causing customers to demand refunds through their bank.

He said a new contract has since been arranged with an alternative courier service, but the number of refunds led to his merchant bank freezing his account, and leaving him unable to access his funds.

He said: "I don't blame them for asking for their money back, I would probably do the same myself, but because the 'chargeback' levels went above one per cent, it meant that our merchant service terminated our account, saying it would be 118 days before we could access our funds."

Mr King said he had received abuse and threats from irate customers – including a message threatening to picket his daughter's school – and said a number of staff had left after suffering from intimidation.

However, he assured all customers that none of them would be left out of pocket as a result of the crash.

Mr King said he was "heartbroken" about the situation, adding: "When I heard the news about City Link on Christmas day, I thought it would be all right, we thought there would be a way around it.

"But it is very hard finding people to deliver beds these days.

"It took us two months to set up an arrangement with a different courier, and then, after all the deliveries had been labelled up, they said they no longer delivered beds. You would have thought the clue was in our name."

"We even hired a couple of Luton vans for a few days and ran those into the ground delivering the beds ourselves," he added.

But he said the cash flow crisis, caused by the withdrawal of his merchant banking service, had led to him losing the confidence of suppliers, giving him no alternative but to cease trading until the matter could be resolved.

"I'm doing all I can to save the company, but I don't know whether we will be able to get through this," Mr King added.

Mr King said his father had recently died at the age of 66, leaving him in sole charge. A statement posted on the company's website says: "Customers who have purchased goods which remain undelivered, the board would like to re-assure them that if the company remains unable to deliver goods, then they will be reimbursed in full.

"The office is currently unmanned while this is being dealt with but if you would like to contact us we have set up an emergency support email address support@monsterbeds.co.uk and this will be looked at daily.

"The board understands your frustration and undertakes everything which can be done is being done to resolve these issues."