Australia's struggling retail sector has been battered in a day that saw major players suffer heavy share prices losses and administrators look to the United Kingdom for a saviour for the collapsed local arm of Topshop.

Ferrier Hodgson partner James Stewart said on Thursday he was in talks with high-profile British retail identity Philip Green about whether his Arcadia Group, which owns the Topshop and Topman brands, could rescue the fast-fashion chain in Australia.

"We are reviewing a potential structure that would see Arcadia Group take a controlling interest in the Australian business," Mr Stewart said.

"Our priority is to develop an appropriate operating model and structure that will continue the Topshop/Topman brand in Australia."

Mr Stewart said the talks were preliminary but there were hopes of finding a structure that would suit all parties.

Topshop's Australian franchisee, Austradia, which opened Topshop and its spinoff Topman locally in 2011, went into voluntary administration on Wednesday night.

Topshop and Topman ran at a $3 million loss in Australia in the first half of this financial year, exposing Myer to a $600,000 loss through its 20 per cent stake.

Austradia has since opened nine standalone stores, including on premier retail strips in Melbourne and Sydney. Insiders have said this repaid expansion was not supported by sales growth.

Myer bought a stake in Austradia in 2015, has rolled out Topshop and Topman concessions to 17 stores, and has said it was "pleased" with how the brands have performed.

One retail analyst said that, while Myer had flagged losses in Topshop, the extent of the deterioration was surprising. The analyst's faith in the "New Myer" strategy, which includes attracting "wanted brands" like Topshop to the store, had not been shaken, however.

"I don't think it's a terrible thing for them," the analyst said, calling the situation with Topshop a "hiccup".

It is understood Myer was exploring the possibility of becoming Topshop's local franchisee.

JP Morgan sounded a warning for retailers in a note released on Thursday, saying that consumer conditions were deteriorating, with heavily-indebted shoppers sensitive to interest rate hikes, rising energy prices and low wage growth and concerning levels of underemployment.

Meanwhile, ecommerce juggernaut Amazon's imminent arrival on Australian shores would drive deflation, hurting the earnings of incumbent retailers.

"The outlook for the Australian consumer is deteriorating, in our view, while the pending entry of Amazon is a negative for multiples and EPS forecasts," the JP Morgan note said.

JP Morgan said that by the 2019 financial year those headwinds would cut earnings per share by 12 per cent at Harvey Norman, 20 per cent at JB Hi-Fi, 30 per cent at Myer and 16.5 per cent at the Super Retail Group, which owns Rebel Sports, Supercheap Auto and other brands.

JP Morgan cut its share price target for each of the retailers drastically, lowering Harvey Norman from $4.60 to $3.50, JB Hi-Fi from $32 to $20.50, Myer from $1.15 to 80?? and Super Retail from $11.50 to $7.25.

Myer shares closed down 4.3 per cent, Harvey Norman down 2.1 per cent, JB Hi-Fi down 1.6 per cent and Super Retail down 5.9 per cent.