More than 850 jobs have been axed at failed retail chain Allied Carpets after administrators were forced to close 142 stores, it was revealed today.

BDO Stoy Hayward said it had been unable to sell on the bulk of the flooring firm's branches amid fears over tough trading.

The stores were all closed by yesterday, but the future of around another 120 jobs still hangs in the balance as BDO seeks to offload the remaining 20 outlets remaining in administration.

BDO has already sold 55 stores to a new firm set up by former Allied chief executive Clive Hutchings, having recently struck a deal to offload another four to the firm, called Allied Carpets Retail Limited.

Allied Carpets went into administration last month, with 21,000 orders still outstanding.

BDO said it was making good progress finishing the orders, with 16,000 fulfilled so far, and aims to ensure all are completed eventually.

It remains hopeful of selling on the remaining stores that are still trading and said it was also in negotiations over deals for the premises of those stores included in the recent wave of closures.

Dermot Power, BDO Stoy Hayward business restructuring partner, said: "Although we have had a strong level of initial interest in the portfolio, the common concern has been around the lack of visibility of future turnover.

"In addition, many of those who operate in the same industry haven't been comfortable taking the step to extend their current portfolio in such a tough trading climate."

Allied Carpets fell victim to the housing market slump as fewer home sales dented demand for flooring and carpets.

But ex-boss Mr Hutchings is hoping to revive the brand after his deal to buy 55 of the stores and the insurance inspection arm.

He said on completing the purchase in mid-July: "Allied Carpets is a good business and, through this sale and additional funding, both the retail and inspections businesses now have the opportunity to strengthen their respective market positions, build on the Allied brand and ensure an ongoing commitment to unrivalled customer service."

His efforts to buy up stores have helped protect around 425 jobs and BDO said it was "likely" more outlets and jobs would be transferred to the new outfit within the next two weeks.

However, those jobs saved so far account for less than a third of the original 1,500-strong workforce employed by Allied Carpets.

The chain had 217 stores when it went into administration, a headquarters in Kent and a distribution centre in Lancashire.