Music Retailer Zavvi Falls Into Administration

High street music and DVD retailer Zavvi has been placed into administration.

The company, which employees more than 2,000 people in the UK, has suffered since the demise of Woolworths.

The store relied on Woolworths' distribution branch Entertainment UK (EUK) to deliver its CDs, DVDs and video games.

The company, formerly Virgin Megastore, stopped deliveries and online trading last month after the long-established high street store collapsed.

In a statement, Administrator Ernst & Young said “dire trading conditions” meant the Zavvi group had “seen a material fall in sales”.

It said it would try to keep the music retailer running while it searches to find a buyer. The chain's stores are due to open as normal for traditional Boxing Day sales.

Zavvi is the latest high profile victim of the global financial crisis.

Two other popular high street names - Tea and coffee specialist Whittards and menswear store The Officers Club – have both been taken into administration during the Christmas period.

Woolworths, which would have celebrated its 100th year of trading in 2009, is due to close on January 5th, unless a last minute buyer can be found.

Click here to read Jason Gregory’s look at the affect the digital world has had on stores like Woolworths and Zavvi.