Companies are warning it will have a Tsunami-like effect across the trade as the withdrawal of credit meant many were forced to trade without insurance.
One said: "They reassured us on Wednesday that we would all be paid, but today is pay day for suppliers, which is why they made the decision last night. The Christmas push is going to kick off in the trade next week, so FQR had built up a lot of stock."
"It's a dark day for the trade and a watershed moment for drinks retailing," said Steve Barton, joint director at Brand Phoenix.
"This is like Woolworths. First Quench had the same problem, it was asset-stripped and doesn't own any stores. I can't see anyone buying it lock stock and barrel. Although FQR was clearly operating in tough market conditions, its demise sends a clear message about the government's ludicrously high taxation system and the burden this places on business during the deepest recession.
"The Parliamentary Select Committee asked us earlier this year what the impact of further increases would be and we warned them then, but they didn't listen."
FQR owner Vision Capital said it hoped to sell the business as a going concern. It operates 1,300 stores with 6,500 staff.