Toys R Us and electronics chain Maplin are on the brink of calling in the administrators, putting 5,500 jobs at risk.
Online news reports say Britain’s biggest toy shop chain is desperately trying to find the cash for a £15 million VAT bill after failing to secure a rescue deal, while talks with a potential buyer over the sale of Maplin are understood to have broken down.
Both companies have stores on Chester's Greyhound Retail Park, and there is another Maplin on the Coliseum Shopping Park.
Toys R Us , whose US owner filed for bankruptcy protection last September, managed to stave off collapse in December by agreeing a rescue plan to allow it to restructure its operations, including the closure of at least 26 stores planned for this spring.
But the new year has seen poor sales and with the VAT bill looming, the only route left for the firm to continue trading was to find a buyer which according to national media, now seems unlikely - and 3,200 jobs face an uncertain future.
Meanwhile, 2,500 jobs hang in the balance at consumer electronics chain Maplin who had been in talks with the owner of Edinburgh Woollen Mill over a possible rescue deal after experiencing falling profits.
But discussions between Maplin and Philip Day, who also owns fashion chain Peacocks, are said to have broken down, meaning that administration is now the most likely outcome for the firm.
Toys R Us and Maplin are the latest of a string of high street retailers to run into into financial problems in recent months thanks to the increase of online shopping.
A collapse of the two companies could see almost 6,000 retail jobs disappear from the UK’s High Streets.