Bargain Booze owner Conviviality plans to appoint administrators within the next 10 business days "unless circumstances change", putting 2,500 jobs at risk.
The company said it will continue trading over that period in the hope of preserving "as much value as possible" for its stakeholders.
It will keep working alongside advisers and said it is exploring "a number of inbound enquiries regarding a potential sale of all or parts of the business".
"Following discussions with its lending banks, the board has resolved to file notice of intention to appoint administrators to the company," Conviviality said in a market announcement.
"Unless circumstances change, and in accordance with statutory requirements, the board intend to appoint administrators within 10 business days."
As well as running a network of stores, including a number in Sheffield, the firm is a key part of the supply chain to the UK drinks industry.
The firm supplies to more than 23,000 pubs an restaurants, including the JD Wetherspoon chain.
Over the past few weeks, the firm has seen its chief executive Dianna Hunter step down after issuing a string of profit warnings and revealing a £30 million tax bill.
Conviviality was forced to go cap in hand to investors to raise £125 million as a result, but it has been unable to convince them of its long-term future.
Ms Hunter, a former Waitrose director, had been chief executive since 2013 and led the group through its stock market flotation in the same year.
She also oversaw a number of acquisitions, including Wine Rack, Matthew Clark and Bibendum.
Non-executive chairman David Adams has taken her place until further notice.
The company's collapse would cap a nightmare quarter for the retail sector.
Since January, Toys R Us and Maplin have filed for administration, while fashion retailers such as New Look and Select have embarked on radical store closure programmes.
Piling on the misery has been the under-pressure casual dining sector, with Prezzo, Byron and Jamie's Italian all shutting restaurants and culling hundreds of jobs.