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RadioShack to close up to 1,100 stores as earnings dip well below expectations

post #1 of 40
Thread Starter 
RadioShack on Tuesday announced it will be closing up to 1,100 stores after reporting a $400 million operating loss for 2013, highlighting the Apple retail partner's struggle with adapting to the fast-changing consumer electronics market.

RadioShack
RadioShack's online store locator shows an abundance of New York locations. | Source: RadioShack


According to The Wall Street Journal, RadioShack made the announcement alongside lower-than-expected quarter four financial results. The company logged a loss of $191.4 million for the quarter, up from the $63.3 million lost a year earlier.

Analysts polled by Thomson Reuters expected RadioShack to announce a per-share loss of 14 cents, but the final tally came out to a much higher $1.46 per unit. The retailer was also figured to hit $1.12 billion in sales for the December quarter, but ended up with $935.4 million, a 28-percent year-over-year drop.

Well known for having a near-critical mass of stores spread across the country, RadioShack will close up to 1,100 under-performing locations. The number accounts for approximately 26 percent of company-owned outlets.

"Within five miles of my home, I have eight RadioShack locations," said RadioShack CEO Joe Magnacca, referring to the overcrowded distribution of stores.

RadioShack reported slow sales of phones, tablets and accessories, which usually account for half of the company's business. The retail chain once catered primarily to DIY enthusiasts and was slow to adopt mainstream consumer electronics.

In recent years, the company has made efforts to offer smartphones and tablets at low prices, including regular discounts on Apple's iPhone. In 2010, for example, the Apple retail partner was the nation's second-largest iPhone seller in terms of brick-and-mortar stores that carried the device.

It appears the aggressive price cuts and limited-time-only discounts were not enough to buoy revenue, and in fact may be to blame for the poor quarterly performance.

"Simply put, we exceeded our organization's capabilities by trying to do too much too quickly," Magnacca said.
post #2 of 40
Radioshack started failing the moment they went into the cellphone business. Now, none of the employees know anything about cables or stuff like that. And they're rude. I knew it was coming. They need to change their strategy!
post #3 of 40
'Apple retail partner'?! You guys make them sound like they were Best Buy.

Lol. I thought that RS was the scraping of the bottom of the barrel for Apple, after every other conceivable retailer had been tapped.
post #4 of 40
Quote:
Originally Posted by iNosey View Post
 
They need to change their strategy!

The only 'strategy' left for them is to go quietly into a corner and die.

post #5 of 40
Quote:
Originally Posted by iNosey View Post

Radioshack started failing the moment they went into the cellphone business. Now, none of the employees know anything about cables or stuff like that. And they're rude. I knew it was coming. They need to change their strategy!

Radio Shack employees and managers are listed as one of the ten most underpaid and overworked group of employees in the country. Right down there with Dollar Store and others. It's a shame really, as they sell stuff you can't find anywhere else.

Besides selling Apple iDevices, they carried every conceivable brand of touch phones in the world. Waaay too many... it was a joke go in and see so many.
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"That (the) world is moving so quickly that iOS is already amongst the older mobile operating systems in active development today." — The Verge
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post #6 of 40
Originally Posted by AppleInsider View Post
The retail chain once catered primarily to DIY enthusiasts and was slow to adopt mainstream consumer electronics.

 

And when you get into "mainstream consumer electronics" you're up against Best Buy and Target and Wal-Mart.

 

Oh, and there are 6 Radio Shacks within 5 miles of my house.  2 are directly across the street from each other.

The first thing I saw when I went in to get batteries was a Porsche 918 radio controlled car for $34.95.

It looked like an AT&T store but with more toys and tiny little Bluetooth speakers.

I used to get 47K Ohm resistors there when I was a kid.

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post #7 of 40

Man I feel guilty...

 

...Is this b/c last weekend I went to RS to get a replacement pwr brick for my Ext. HD and they wanted $22 for it. I went home and got it on Amazon for $6.

 

Sorry.

post #8 of 40
Quote:
Originally Posted by anantksundaram View Post

The only 'strategy' left for them is to go quietly into a corner and die.
And take take away a revenue source for Apple. Makes "perfect" sense. Smh....
post #9 of 40

The end of an era long overdue. Even the name . . . c'mon. Bye, bye.

Daniel Swanson

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Daniel Swanson

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post #10 of 40
Quote:
Originally Posted by Lord Amhran View Post

And take take away a revenue source for Apple. Makes "perfect" sense. Smh....

I guess you must know the answer to this question, then: How much revenue do they generate for Apple? $1000? $1,0000,0000? $1,000,000,000? More? Less?

If you don't know, move along.
post #11 of 40
Quote:
Originally Posted by anantksundaram View Post

I guess you must know the answer to this question, then: How much revenue do they generate for Apple? $1000? $1,0000,0000? $1,000,000,000? More? Less?

If you don't know, move along.
Doesn't make a difference. A closed revenue source is a closed revenue source nomatter if it's 1¢ or $1,000,000,000.

If you can't see that, move along.
post #12 of 40

Two questions:

 

What's a radio? And, what's a shack?

post #13 of 40

I need a 1100 microfarad capacitor at 25 volts.  Huh?  Bad Boys rape our young girls but violet gives willingly.  HUH!!?!?!?!?!?

An Apple man since 1977
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An Apple man since 1977
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post #14 of 40
Quote:
Originally Posted by Lord Amhran View Post

Doesn't make a difference. A closed revenue source is a closed revenue source nomatter if it's 1¢ or $1,000,000,000.

If you can't see that, move along.

The catch is that there are likely very very few places where there isn't a carrier store, best buy, Walmart, Apple store in the same area plus being so out in ten docks that someone can't just order online.
Making it not so much a closed source but a shifting one.

A non tech's thoughts on Apple stuff 

(She's family so I'm a little biased)

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A non tech's thoughts on Apple stuff 

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post #15 of 40
I think we've all seen the onion article%u2026
post #16 of 40
post #17 of 40
Well, if we haven't before, we have now!
post #18 of 40

They should turn themselves into mini Apple stores. There are plenty of Apple products they could sell.

post #19 of 40
Quote:
Originally Posted by DanielSW View Post
 

The end of an era long overdue. Even the name . . . c'mon. Bye, bye.

They have changed their name a few times before but mostly their problems stem from decades of horrible mismanagement. Incompetent CEOs, awful customer service and terrible working conditions make it one of the worst companies ever. At this point they would probably do better if they became a fast food chain and take advantage of all those locations. Perhaps Taco Shack.

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Life is too short to drink bad coffee.

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post #20 of 40
Originally Posted by christopher126 View Post

...Is this b/c last weekend I went to RS to get a replacement pwr brick for my Ext. HD and they wanted $22 for it. I went home and got it on Amazon for $6.

 

I had to get a voltmeter from my local Radio Shack not too long ago.

 

I kept looking at the prices and thinking to myself, “Okay, there’s something I’m missing here. There has to be some aspect of this that I’m just not getting…”

Originally posted by Marvin

Even if [the 5.5” iPhone exists], it doesn’t deserve to.
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Originally posted by Marvin

Even if [the 5.5” iPhone exists], it doesn’t deserve to.
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post #21 of 40
RS always seemed like the Woolworth of electronics to me. That's not meant as a complement by the way.
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Been using Apple since Apple ][ - Long on AAPL so biased
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post #22 of 40
Quote:
Originally Posted by NotScott View Post

Two questions:

What's a radio? And, what's a shack?

I think they are both from 1950.
Been using Apple since Apple ][ - Long on AAPL so biased
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Been using Apple since Apple ][ - Long on AAPL so biased
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post #23 of 40

According to Minority Report RadioShack is still around in 2054.

post #24 of 40
I'm surprised RS continued reasonably successful as long as they did. The electronics market has changed, the DIY repair market is gone. I still used RS a bit for cables plus nuts and bolts, but now there are several other big and little PC shops here where I can get PC components at a lower price.

So goodbye RS, it was nice knowing you for a long time.
post #25 of 40
I'm surprised RS continued reasonably successful as long as they did. The electronics market has changed, the DIY repair market is gone. I still used RS a bit for cables plus nuts and bolts, but now there are several other big and little PC shops here where I can get PC components at a lower price.

So goodbye RS, it was nice knowing you for a long time.
post #26 of 40
Having more than 15x the number of stores Apple has worldwide when you aren't making enough profits isn't a good way to go - 1,100 is just the ones they are closing, they will still have 4,000 after the closures. They do sales online but the problem online is they compete with Amazon and very few companies can. That's where the retail stores work better because they can push higher margins. Although a lot of people are well informed about online prices, for some items it's easier to get them in a store as you can see physical dimensions, weight, you don't have to wait for a delivery etc. They are nowhere near going out of business with another 4,000 stores so we'll see if the closures help turn their profits round.
post #27 of 40

This is what happens when a store abandons its loyal customer base.

 

Radio Shack used to be a store that catered to electronic hobbyists with a wide selection of stocked parts, cases, and kits.  Over the years, they've turned their back on that market, discontinuing most of the items that serve those customers.  And when you can't get everything you need for a project, there is no reason to order some parts from Mouser, DigiKey, etc. and then pay a premium to Radio Shack for the small number of parts that they do have in stock.

 

I don't want an overpriced cell phone case.  I don't want a low-end digital camera.  I don't want an outdated car GPS.  I don't want a bad remote controlled car.  I want parts for the projects I'm building and the electronics that I'm repairing/upgrading.

 

Their web site is everything that's wrong with brick and mortar web sites.  It's primarily items that they don't carry in the store and that have nothing to do with electronics.  Really, Radio Shack, you thought I was coming to your web site to order a Ladies Bikini Trimmer (Catalog #: 55075265), Double-Sided Lighted Make-Up Mirror (Catalog #: 55075322), or a hand-cranked Manual Wheat Grass Juicer (Catalog #: 55074041)?  Maybe they figure that there's a big untapped market of people who are offended by Amazon's wider selection, lower prices, and much better search and ordering systems?

 

They need to get back to what made them successful and quit trying to be an Amazon ultra-lite.

post #28 of 40
Quote:
Originally Posted by Tallest Skil View Post
 

 

I had to get a voltmeter from my local Radio Shack not too long ago.

 

I kept looking at the prices and thinking to myself, “Okay, there’s something I’m missing here. There has to be some aspect of this that I’m just not getting…”

Yep, I guess it has served it's purpose.

 

It always felt like walking into a "Hobby" store. And then most recently, walking into a cellphone store (as people have lamented above).

 

I get a similar ill-feeling when I walk into a BestBuy (which I rarely do anymore). All the blue/black, plasticky, crap products bring me down.

 

I guess, I've been spoiled by the experience of shopping at the Apple Stores! For some reason, It's just a very pleasant experience and I don't mind spending $99 for ATV at the Apple store, as opposed to $93 on Amazon! :)

 

Best.

post #29 of 40
Who didn't see the writing on the wall.
RS is a played out business model. With ebay and Amazon who the hell needs them. They suck anyhow with their sorry ass employees. Hahahaha!
Take the middle fingers clowns.
post #30 of 40
Quote:
Originally Posted by fmaxwell View Post
 

This is what happens when a store abandons its loyal customer base.

 

Radio Shack used to be a store that catered to electronic hobbyists with a wide selection of stocked parts, cases, and kits.  Over the years, they've turned their back on that market, discontinuing most of the items that serve those customers.  And when you can't get everything you need for a project, there is no reason to order some parts from Mouser, DigiKey, etc. and then pay a premium to Radio Shack for the small number of parts that they do have in stock.

 

I don't want an overpriced cell phone case.  I don't want a low-end digital camera.  I don't want an outdated car GPS.  I don't want a bad remote controlled car.  I want parts for the projects I'm building and the electronics that I'm repairing/upgrading.

 

Their web site is everything that's wrong with brick and mortar web sites.  It's primarily items that they don't carry in the store and that have nothing to do with electronics.  Really, Radio Shack, you thought I was coming to your web site to order a Ladies Bikini Trimmer (Catalog #: 55075265), Double-Sided Lighted Make-Up Mirror (Catalog #: 55075322), or a hand-cranked Manual Wheat Grass Juicer (Catalog #: 55074041)?  Maybe they figure that there's a big untapped market of people who are offended by Amazon's wider selection, lower prices, and much better search and ordering systems?

 

They need to get back to what made them successful and quit trying to be an Amazon ultra-lite.

All great points! And well presented. :)

 

Perhaps, the market you speak of was dwindling and they saw the writing on the wall. And didn't have many options except to panic and become the a crappy store you describe.

 

Maybe they just have to go away, like Wards, Woolworths, Circuit City, CompUSA, Sears/Kmart, etc., etc.

post #31 of 40

They really need to stop selling all of those el-cheapo Android phones.  The people who get those just want them for free.  If Radio Shack was known for selling only iPhones, they would make a lot more money.  Get rid of that low-profit crap and deal exclusively with Apple.

post #32 of 40
Where am I going to buy my next Tandy Computer at? Dang!
post #33 of 40
Quote:
Originally Posted by NotScott View Post

Two questions:

What's a radio? And, what's a shack?

One answer:

The two words that make up the name 'Radio Shack.'
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post #34 of 40
Quote:
Originally Posted by digitalclips View Post

RS always seemed like the Woolworth of electronics to me. That's not meant as a complement by the way.

Complement to what? Or, maybe, a compliment. 😉
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post #35 of 40
Quote:
Originally Posted by christopher126 View Post

All great points! And well presented. 1smile.gif

Perhaps, the market you speak of was dwindling and they saw the writing on the wall. And didn't have many options except to panic and become the a crappy store you describe.

Maybe they just have to go away, like Wards, Woolworths, Circuit City, CompUSA, Sears/Kmart, etc., etc.

Thanks for not finishing a post with 'Best.' I know you mean to be polite, but it annoys me.
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post #36 of 40
Quote:
Originally Posted by Benjamin Frost View Post

Thanks for not finishing a post with 'Best.' I know you mean to be polite, but it annoys me.

Wow. You must get up off the wrong side of the bed a lot.

 

Best.

 

Add: I realize that I am being somewhat nasty, but that was an incredibly annoying thing on your part to say. It also does to take into account the fact that C123 may not be posting just for you, but for people in the Forum in general, many of whom might actually like the way he signs off.

post #37 of 40
Quote:
Originally Posted by anantksundaram View Post

Wow. You must get up off the wrong side of the bed a lot.

Best.

Add: I realize that I am being somewhat nasty, but that was an incredibly annoying thing on your part to say. It also does to take into account the fact that C123 may not be posting just for you, but for people in the Forum in general, many of whom might actually like the way he signs off.

I think if everyone signed off 'Best,' you'd see what I mean.
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post #38 of 40
Sure, they had some cool misc. electronic supplies but other than that, every store I walked into was filled with ridiculously over-priced stuff sold by over-geeked out salesman.  No offense.  :-)
post #39 of 40
Quote:
Originally Posted by anantksundaram View Post

The only 'strategy' left for them is to go quietly into a corner and die.
That's true
post #40 of 40
Quote:
Originally Posted by fmaxwell View Post

This is what happens when a store abandons its loyal customer base.

Radio Shack used to be a store that catered to electronic hobbyists with a wide selection of stocked parts, cases, and kits.  Over the years, they've turned their back on that market, discontinuing most of the items that serve those customers.  And when you can't get everything you need for a project, there is no reason to order some parts from Mouser, DigiKey, etc. and then pay a premium to Radio Shack for the small number of parts that they do have in stock.

I don't want an overpriced cell phone case.  I don't want a low-end digital camera.  I don't want an outdated car GPS.  I don't want a bad remote controlled car.  I want parts for the projects I'm building and the electronics that I'm repairing/upgrading.

Their web site is everything that's wrong with brick and mortar web sites.  It's primarily items that they don't carry in the store and that have nothing to do with electronics.  Really, Radio Shack, you thought I was coming to your web site to order a Ladies Bikini Trimmer (Catalog #: 55075265), Double-Sided Lighted Make-Up Mirror (Catalog #: 55075322), or a hand-cranked Manual Wheat Grass Juicer (Catalog #: 55074041)?  Maybe they figure that there's a big untapped market of people who are offended by Amazon's wider selection, lower prices, and much better search and ordering systems?

They need to get back to what made them successful and quit trying to be an Amazon ultra-lite.
Yeah they need to tap into the new DIY wave ei. MakerBots, arduino, raspberryPI, cell phone repair, desktop laser cutters & wire benders, home made circuit boards etc. they could catch it and ride it with the right vision and implementation.
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