A buyer is being sought for Humberside Optical which went into administration last week after the loss of a big customer.
Joint administrators Andrew MacKenzie and Bob Maxwell of Begbies Traynor said they had high hopes of finding a buyer and the company would continue trading.
Poor trading conditions had left the firm with unserviceable levels of debt which led to half of the firm's 40-strong workforce being made redundant.
A statement said the loss of a 'significant' customer had led to the redundancies and the appointment of the administrator. Twenty of the company's 40 employees were immediately made redundant in order to align the cost base with the current level of turnover.
'The poor recent trading of the business has left the firm with unserviceable debt, and forced the redundancies in order to give the business any chance of survival,' said joint administrator Andrew MacKenzie.
'The firm has a decent order book, some high quality plant and machinery and a very skilled and loyal workforce, and we are optimistic that a buyer will be found to ensure its long term survival and protect the remaining jobs,' he added.
Customers have been told that orders will not be affected, and it will be business as usual.
Humberside Optical was founded by Malcolm McCullagh and Ann Whelpton in 1987, and is described as a £1.5m turnover business. The administrators are continuing to trade and are confident of selling the business as a going concern.
Humberside operates from 4,500sq ft premises in Barton-on-Humber near Hull and supplies lenses to opticians across the UK.
Over the past 18 months it has experienced difficult trading conditions, with falling order levels following reduced consumer spending on eyewear as a result of the economic downturn.