It appointed Ian Brown and Neil Matthews of Deloitte as administrators on Monday (5 January).
NSL is currently being traded as a going concern. Two potential buyers have been shown around its 6900sqm factory on the New York Industrial Estate, North Tyneside, as the administrators consider more offers.
Brown told PrintWeek: "From what I understand, Woolworths was a reasonably large client for NSL, but the problems started 18 months ago when the company lost work following Morrisons' acquisition of Safeway.
"Like most print businesses, there's always a fixed cost and once the top line erodes, difficulties are faced. It is a victim of the current retail drop."
Late last year, the £10m-turnover company failed to land a £1m contract with electrical retailer Dixons/Currys, he added.
Billy Green, national officer for Unite, said: "It's believed that the business can still recover if there is a restructure.
"There are obviously problems in the retail sector but we are waiting to hear from our representatives at NSL to find out more but we only have a handful of members at the site."
The 22 affected staff are understood to be awaiting a 30-day consultation period.
NSL was founded by chairman Bill Hesse in 1972. In 1998 it moved into its current site. Duncan Hesse, Bill's son, is NSL's managing director.
In April 2007, NSL purchased a KBA Rapida 205 after winning a pan-European deal with footwear giant Foot Locker.
NSL becomes latest victim of retail downturn
Norscreen, the Newcastle-based large-format company trading as NSL Integrated Print Solutions, has fallen into administration with the immediate loss of 22 jobs after losing work from Woolworths and other major retailers.
