News July 12, 2024
Direct-to-Embroidery Dye Company Coloreel Declares Bankruptcy
The Swedish manufacturer was known for its innovative thread-dyeing system, but operating costs and lack of new funding became too much.
Coloreel Group AB, a Swedish company that specializes in thread-dyeing technology for embroidery, has filed for bankruptcy this week citing “an inability to develop its business volume quickly enough and, related to this, secure the necessary financing.”
Serving customers in more than 20 countries, Coloreel seeks to make the embroidery process more efficient while reducing environmental impact – something realized, in part, by providing solutions that use recycled thread and that help embroidery producers reduce water consumption by 97% compared to traditional dyeing methods, the company has said.
Still, the offerings were not enough to keep the firm from experiencing financial distress.
“We have been working very hard to introduce new technology and new ways of working on the global textile market,” Coloreel Board Chairman Anders Persson said in a statement, according to Sourcing Journal. “Despite relentless efforts to grow the business, minimize operational costs, and secure additional funding, the challenges are too great.”
Persson did not confirm whether this would be the end of the company, saying that it was “too early to evaluate the consequences for the organization.” Coloreel CEO Torbjörn Bäck indicated that there are currently discussions with other companies within the sector about a sale/acquisition.
I love seeing new technologies being developed for old systems!
— Igor Blumberg (@igorblumberg) March 20, 2024
Embroidery's been around for years, but Coloreel's new machine dyes thread as needed, fixing the big color limitation issue and opening up new design options. pic.twitter.com/TCK5hmZMCZ
Coloreel is the 2018 recipient of Sweden’s SKAPA innovation award and was known as having the only instant direct-to-embroidery thread-dyeing technology. The company claims it has more than 120 patents and, after raising more than $8 million in 2021, was in discussions with potential new customers and investment partners.
Coloreel has an existing partnership with Ricoh (asi/308556), and has worked with well-known brands worldwide, including an shop in Berlin with H&M.
Graham Kennedy, general manager of Industrial Solutions for Ricoh told Printweek that Ricoh has been a supporter and supplier of Coloreel from the beginning.
“Coloreel clearly has a unique and potentially transformative technology, but as they say, operationally the challenges to achieve growth have been significant,” Kennedy says. “We wish Torbjörn and his team all the best.”