High-street fashion chains Oasis and Warehouse have entered administration, with 200 staff losing their jobs immediately.
Business services firm Deloitte, which is handling a collapse that was first reported by Sky News, said a further 1,800 workers were being furloughed as a buyer is sought.
The move comes three weeks after The Oasis and Warehouse Group, which has 92 branches and 437 concessions and is owned by the failed Icelandic lender Kaupthing, began discussions with prospective buyers.
Although there is understood to have been strong interest in a deal, the uncertainty caused by the coronavirus pandemic is thought to have made a solvent sale impossible to conclude, though talks are expected to continue.
It marks the latest high street failure as the retail sector, already struggling before the COVID-19 crisis, adapts to the shutdown of non-essential stores.
Debenhams, Laura Ashley and BrightHouse are among the other names to have entered administration in recent weeks.
Rob Harding, joint administrator at Deloitte, said: “COVID-19 has had a devastating effect on the entire retail industry and not least the Oasis Warehouse group.
“Despite management’s best efforts over recent weeks, and significant interest from potential buyers, it has not been possible to save the business in its current form.”
The statement added: “The group employed over 2,000 people in total in the UK at the time of the appointment and today’s announcement will result in 202 redundancies.
“A total of 41 head office roles will be retained to assist the administrators and 1,801 employees will be furloughed across head office, stores and concessions.”
It said online trading would continue in the “short term”.
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