Goodbye Radio Shack

[SpyderDen]

Having owned and operated a RadioShack franchise for over 20 years, I could tell some stories. Sold mine in 2002 before things started going downhill. Contrary to earlier comments, it was the cellular business that paid my bills. Trying to sell big name items (Apple etc) for less than 5% profit doesn't pay employees. Just my $.02 worth.

[2ndChildhood]

I just found out the Radio Shack by me is staying open. And it will be owned by Sprint they think. They're in the process of moving all their inventory back into the store.


ToM
SpyderFest '15

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[Joe T.]

Having owned and operated a RadioShack franchise for over 20 years, I could tell some stories. Sold mine in 2002 before things started going downhill. Contrary to earlier comments, it was the cellular business that paid my bills. Trying to sell big name items (Apple etc) for less than 5% profit doesn't pay employees. Just my $.02 worth.

Interesting point of view. Thanks for the post.

Den, if you would have been in charge of Radio Shack from 1982 until today, what would you have done differently?

Regards,
Joe T.

[Pennyrick]

Having owned and operated a RadioShack franchise for over 20 years, I could tell some stories. Sold mine in 2002 before things started going downhill. Contrary to earlier comments, it was the cellular business that paid my bills. Trying to sell big name items (Apple etc) for less than 5% profit doesn't pay employees. Just my $.02 worth.

This is a quote from an article this week in Bloomberg Business Week on Radio Shack. It's not that the cell phone business wasn't profitable... it was... but apparently to the detriment of the company overall.

Roberts negotiated deals with carriers that gave RadioShack not only a cut of the initial device sale but also payments from customers’ monthly wireless bills. A longtime executive who left the company in the mid-2000s compared the wireless business to a narcotic, with the company bingeing on phone sales while ignoring the other parts of its business. The addiction had consequences. Signing someone up for a mobile contract took about 45 minutes, and many stores were staffed for long stretches by a single employee. Customers in search of help regularly left in frustration, and foot traffic began dropping, says Claire Babrowski, who in 2005 and 2006 served in various executive roles at the company.
The decision to focus so heavily on mobile planted the seeds of what’s happened in recent years, according to Babrowski. “My guess is that, if you could go back to that era, maybe a different decision would have ended up a little differently for RadioShack,” she says.

[SpyderDen]

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Interesting point of view. Thanks for the post.

Den, if you would have been in charge of Radio Shack from 1982 until today, what would you have done differently?

Regards,
Joe T.

That's a tough one Joe. Being on the franchise side vs corp stores, we had different options. We could purchase the same inventory factory direct and cut out RS cut on the inventory. We had the RadioShack sign to give us credibility so kind of had the best of both worlds. When we sold our store there were about 7500 stores total. About 1/3 were franchise. At our peak we outsold 4 corporate stores combined in Madison WI on computers and cell phones and in a town of 10K. I can't think of anyway we could do that now. Our built from scratch store has now expanded to 3 locations and is doing very well. We did everything from installing TV antennas, towers, car stereos, computer networks in schools, two way radio systems in fire departments, ambulance services, agriculture equipment, satellite systems (even the old 10' dishes). Times are changing and if I had the answers, Radio Shack would pay me big bucks to fix it. OK, I'm done.