Ted Baker needs a saviour. Could that be its founder?

Ted Baker investors are hoping for a change in trends at the fashion brand this week as the company marks the end of a year of bad news.

Since the company’s founder, Ray Kelvin, was forced out at the end of last year after being accused of a regime of “forced hugs” and harassment – allegations he has denied – the company’s share price has dived nearly 80%.

After three profit warnings in a year, the latest blow came last week with the admission that the fashion brand had overestimated the value of its stock by as much as £25m and had called in forensic accountants from Deloitte and law firm Freshfields Bruckhaus Deringer to investigate.

The appointments came after advisers from AlixPartners were also brought in to help make improvements in the group’s supply chain. It all gives the impression that Ted Baker is now awash with expensive spreadsheet-wielding consultants having lost guiding light Kelvin.

Investors will be hoping that a strong Black Friday and cooler October and November weather will have delivered better sales for the brand. However, the signs are not great, given that the company which once prided itself on minimal discounting was offering 40% off last week.

The accounting issues, which relate to a period before this year, are particularly uncomfortable for Lindsay Page, the man who took over from Kelvin as chief executive. Before his promotion, Page had been joint chief operations officer and chief financial officer for more than four years and finance director for 17 years before that. It had been his job to formally oversee the work of finance head Charles Anderson, who left for Mulberry in October.

With retail giants such as Debenhams and Arcadia in trouble, bankers are unlikely to be lining up to back a white-knight bid

“For an average listed business, this would be a bump in the road, but for Ted Baker, it is the latest in a line of setbacks that continue to damage investor confidence,” analysts at Peel Hunt wrote. They suggest the problem may relate to glitches in automated accounting systems rather than human error, although, if so, they question why the problem has not continued this year.

They reckon the brand still “resonates with consumers” and that there have been improvements in ranges and pricing. There have also been moves to deal with other problems, including the signing of a new childrenswear deal with Next to replace an agreement with ailing Debenhams.

With the share price at its lowest for nearly a decade, there are now rumours that Kelvin, who still owns nearly 35% of the company, might try to take it private.

But the fashion industry is in the midst of a massive shakeout. Low consumer confidence, online rivals, concerns about sustainability and a trend among younger people for spending on experiences rather than “stuff” have all put a dampener on fashion shopping.

With retail giants such as Debenhams and Arcadia in trouble, as well as mid-market brands such as Karen Millen and LK Bennett, bankers are unlikely to be lining up to back a white-knight bid from Kelvin even if he is motivated to make one. The allegations of ear-kissing and shoulder-massaging are unlikely to help.

But Kelvin, who styles himself as “the man closest to Ted” – and has had a penchant for half-hiding his face in photographs – may yet find a way. When he stepped back from the business a year ago, Kelvin said he couldn’t bear to see the brand harmed in any way as it had been “my life and soul for 30 years”.

Now may be the time to back that commitment with cash.