CD and DVD retailer Music Zone has gone into administration.
Music Zone has struggled against online competition
The chain, which has 104 stores across the UK and 1,100 staff, had been struggling against competition from online retailers and the supermarkets.
Music Zone said it had no alternative to administration after its banks decided to recover debts without notice and with immediate effect.
Administrators said they would continue trading at the firm while seeking a buyer to run it as a going concern.
Music Zone was bought in a £12m management buy-out in 2005, backed by private equity firm Lloyds Development Capital.
A company spokesman said the firm was not alone in experiencing "challenging trading conditions" on the High Street.
He added that pre-Christmas spending was also poorer than expected.
Stockport-based Music Zone said in January last year that it was "optimistic about future growth".
It made the comments after it bought 43 former stores from the MVC chain, which had itself gone into administration.
Music Zone was founded by Russ Grainger from a market stall in Longsight, Manchester, in 1984.