More than two years after the business closed, new owners Peter and Wendy Langridge have reported a major turnaround in fortunes.

The facility shut in late 2007 after owners Joshua and Mary Pila, of Victoria, failed to sell it.

Declining sales and mounting losses were blamed for the closure, more than 56 years after James Nelson started operating.

Mr and Mrs Langridge led a management buy-out and have gradually ramped up production, while staff levels have also increased from 15 to 35.

"We started with seven looms and lots of enthusiasm and we are now operating with about 50 looms which is about 85 per cent capacity," Mr Langridge said.

"With the new order and a lot of ongoing inquiries we are hoping to get to 68 looms, which is full capacity, in another six months."

Mr Langridge said the latest multimillion-dollar order from the Specialty Group of Melbourne for interstate and overseas customers had gone against the trend of companies importing fabric from Asia.

The polyester-base cloth is aimed at customers in the window furnishings sector.

Mrs Langridge said they felt vindicated by their decision to keep James Nelson operational.

"I always knew it was a good business and our old customers are now coming back after the previous uncertainty," she said.

"Everyone was behind us - you can't do it without your employees who are pretty happy.

"But it was a big challenge."

If the business continues to improve, another production line could be added to capture a greater export market.