The move would put around 15,000 jobs at risk from across the firm’s portfolio, which includes other high street favourites including Burton and Miss Selfrige.
It follows speculation that Mike Ashley's Frasers Group could offer a 50 million lifeline to Sir Philip’s once vaunted multinational.
But this was reportedly dismissed by the BBC’s source who suggested such an amount would not even come close to plugging the hole in Arcadia’s finances.
They told the corporation’s business editor Simon Jack: "If this was about £50 million we could find that in five minutes.
"This is obviously a sad day, we tried to save it a year ago when £200m was put into the business and the pension fund, but it's impossible to operate now.
"You don't when you'll be open, you don't know what stock to buy."
The group, which had been in emergency talks with lenders in a bid to secure a £30 million loan to help shore up its finances, is expected to to appoint Deloitte as administrators in the coming days.
If the insolvency is confirmed, it is expected to trigger a scramble among creditors to get control of company assets.
It is the latest retailer to have been hammered by the closure of stores in the face of coronavirus, with rivals including Debenhams, Edinburgh Woollen Mill Group and Oasis Warehouse all sliding into insolvency since the pandemic struck in March.
The group has more than 500 retail stores across the UK with the majority of these currently shut as a result of England’s second national lockdown, which will end next week.
Earlier this year, Arcadia revealed plans to cut around 500 of its 2,500 head office jobs amid a restructure in the face of the Covid-19 crisis.
For the thousands of Arcadia staff that remain, there is also the matter of a £350 million hole in the company's pension fund.
Chair of the Work and Pensions Committee Stephen Timms has called on the Green family to step up and fill the whole.
Sir Philip is chairman of group, while his wife Cristina is the majority owner of its parent company Taveta Investments.
The couple are worth £930 million, according to the Sunday Times Rich List.
The Labour MP said: "This is a dreadful time for Arcadia staff to be worrying about their jobs and their pensions."
"Whatever happens to the group, the Green family must make good the deficit in the Arcadia pension fund," he said.
Mr Timms said he would raise the matter with the Pensions Regulator on Monday.