The business will now focus on a new e-Waste venture.

The Wool Factory's 43 supported employees will retain their jobs despite the change in direction.

People with disabilities who cannot gain mainstream employment make up a majority of The Wool Factory's workforce.

Wool Factory supported employee Darryll Laverty checks the quality of a fleece at the Wool Factory.

Community Axis and The Wool Factory officially amalgamated on April 11 last year to become Community Axis Enterprises.

General manager Colin Barnett said The Wool Factory started decreasing the number of sheep in its ultra fine wool production in November because it was no longer viable.

The following month Community Axis Enterprises decided to phase out wool production completely this year.

Mr Barnett said June 30 was the official finish date but production would cease before then.

"Our plans haven't changed. The last sheep will probably be shorn in April. We have 700 sheep now and we will shear 500 of them this week," he said.

"We don't have a set finish date. We have to contract a shearer. The sheep they are shearing now we planned to shear three weeks ago, but the shearers were held up so putting an exact date on it is not possible."

Mr Barnett said the business would also change its name.

"We have a few ideas and we are close to picking a new name," he said.

"It is a sad thing for wool to be going, particularly because it has been such a good business and provided supported employment.

"Wool was able to do that for a number of years but e-Waste will be able to do the same thing."

Mr Barnett said ultra fine wool was a market that had been in decline for many years.

He said the business began the new e-Waste section in December where workers separate waste components, including plastic, glass, steel and copper wire and sell it on to markets. The business is working with Horsham Rural City, Ararat Rural City, Northern Grampians Shire and Yarriambiack Shire councils on the new enterprise.

Mr Barnett said the e-Waste section included a supervisor and six other staff and had evolved into a strong business.

"We have adapted one of our workshops where we dismantle televisions and computer screens," he said. "Televisions are quite big business at the moment. Because of the change to digital TVs a lot of analogue sets are being dumped.

"We have plans to redevelop a 33-metre section of one of our existing wool sheds. We want to put in a concrete floor and roller doors. It will take at least a few months.

"We are working with Horsham Rural City Council and we have a contractor. We are starting to dismantle the floor and sheep pens."

Mr Barnett said the change in business could mean more workers are employed. "We are pretty confident it is going to be strong. We have received 35 tonnes of material since December,'' he said.

"Another area we are considering going into is mattresses.

''They are an issue for councils with landfill.

"We have also increased stock in our gift shop and encourage people to shop there.

''Hopefully that will grow for us as well."