Retailer Toys R Us has fallen into administration, putting 3,200 jobs at risk.

All its stores are continuing to trade for now but administrator Moorfields Advisory has started an "orderly wind-down" of the company's stores.

The firm failed to find a last-minute buyer to save the business.

The company, which has a branch in Poole, is understood to have struggled with cash flow pressures after sales were squeezed by worse-than-expected trading over the crucial Christmas period.

It comes after the beleaguered firm announced a Company Voluntary Arrangement (CVA) at the end of last year in an attempt to shore up its financial position by allowing it to shut loss-making stores and secure deep discounts on rental costs.

Under that plan, the Poole branch escaped a list of 26 stores earmarked for closure but was due to be 'downsized'.

The branch, at Nuffield Road, was said then to be "marginally profitable" but "underperforming". It was in line for a revamp as one of a new breed of smaller stores.

The restructuring plan won the approval of 98 per cent of creditors in December, and had the backing of the Pension Protection Fund (PPF).

Jeff Bray, senior lecturer in marketing and retail management at Bournemouth University, said of the news: “It’s absolutely no surprise at all unfortunately. I think it’s part of the radical changes that we’re seeing in the retail market.

"They’ve made their name on the basis of having the widest possible range of toys but that point of difference, that competitive edge, has been completely lost due to the internet.

“They simply couldn’t’ compete with Amazon or other online retailers in terms of depth of range so the only way they could compete is by offering  better service or a more enjoyable shopping experience and sadly they’ve been under increasing pressure due to the ownership structure and the fact that it’s heavily debt-laden. They haven't been able to invest in refurbishing stores, bringing in nice experiential displays and service so the customer would have a reason to go there.

“Quite how anybody could manage to make a toy shop boring, I don’t know."

He said the recovery plan had been "too little, too late".

He added: "The writing, in my view, was already on the wall and while they might have had a credible plan in place, they didn’t have enough money to put back for that to gain traction."

But Dr Bray added: “I think this is a great news in terms of the opportunity for independent or local toy shops because there’s still absolutely demand for a physical store where you can see things and get some advice.

"There’s a great opportjnity for a nice high street independent toy shop.”

Toys R Us was grappling with a £15million tax bill as well as money owed to lenders.

Simon Thomas, Moorfields partner and joint administrator, said: "We will be conducting an orderly wind-down of the store portfolio over the coming weeks.

"All stores remain open until further notice and stock will be subject to clearance and special promotions. We're encouraging customers to redeem their gift cards and vouchers as soon as possible.

"We will make every effort to secure a buyer for all or part of the business."

The conmpany's pension fund is set to be taken over by the PPF.

Mr Thomas said: "Whilst this process is likely to affect many Toys R Us staff, whether some or all of the stores will close remains to be decided.

"We have informed employees about the process this morning and will continue to keep them updated on developments.

"We are grateful for the commitment and hard work of employees as the business continues to trade."

No more gift cards will be sold from today.