Industry observers have warned that the games market may be irreparably damaged by the loss of almost 300 Game Group stores.

While the UK business was bought out of administration this week and will operate as a 333-store estate under new owner OpCapita, as much as half the turnover of the 277 sites that have ceased trading could be lost.

Based on Game Group’s 2011 revenue of £935m - about 40% of the games market - the games industry’s loss could exceed £200m.

Observers have drawn parallels with the demise of Woolworths, when markets struggled to recover all the sales lost after its collapse in 2008.

“There is likely to be an effect on sales,” said a spokeswoman for the Entertainment Retailer’s Association, adding that the true impact would be felt at the end of year when the biggest games launch. “There is a risk the trade will lose from the Christmas impulse and gifting market.”

Retailers have reported increased sales of titles Game Group hadn’t been able to supply, and last week Tesco ran a full-page national newspaper ad headlined ‘Tesco: The Home of Gaming’.