Around 100 hundred people are to lose their jobs at Royal Worcester's porcelain factory.
The company announced the job losses on Friday and said the cuts would come before June 2004.
The Royal Worcester and Spode Group said it was a result of increased completion from abroad.
But the company said the job losses would not affect its other operations in Worcester or its plants in Stoke and Scotland.
In a statement the company said the "extremely difficult" decision had been brought about by depressed market conditions and competition from abroad.
The company said that although it will now source porcelain products from overseas manufacturers it would retain the same "exacting Royal Worcester standards".
A company spokesman added: "This is a tough issue for the company.
"The trend to outsourcing product has affected nearly every other ceramic manufacturer in the UK.
"We cannot remain immune to what are global trends".
The management has now entered into consultations with its workforce to discuss how the job cuts will be implemented.