I haven't set foot in a radioshack since I was in college many years ago and even then the mentioned that they would have to have the part ordered online and delivered to the store. I walked out thinking that I could've done that without the high mark up. I think Amazon and other online distributors have killed their business
RadioShack has given themself a year to achieve a turnaround. The company's total liquidity decreased from $554.3 million at the end of 2013 to $ 423.7 million at the end of the quarter. But its Chief Financial Officer John Feray assured investors that the liquidity they hold was enough to fund its turnaround for the next 12 months.
To make the turnaround feasible, RadioShack has planned or already enacted several changes. First, to decrease expenses, RadioShack plans to reduce rent costs, cut customer compensation expenses, consolidate to fewer freight carriers to reduce rates, buy more store fixtures from Asia, and examine utility bills and rate plans. Like Office Depot (ODP), RadioShack plans to do more with less and shutter 200 stores per year over a three-year period.
Second, the company launched RadioShack Labs with PCH on June 5 to support startups and inventors to boost new product innovation. RadioShack plans to use a "direct-to-store" model for select products by reducing inventory requirements and increasing inventory turn in stores. The “RadioShack labs” is built to mainly stimulate innovation and raise consumer awareness to save its mounting losses in dropped sales. This could be an opportunity to fight against the industry-wide decline in electronics sales and low mobile phone demand due to few new models.
The 2014 Q1 report posted on June 10 marked RadioShack’s ninth consecutive quarterly loss. The company lost $ 98.3 million, or $0.97 a share, compared to a loss of $28 million, or 28 cents a share in the year-ago period. Its revenue dropped 13 percent from $848.4 million to $736.7 million. Sales fell 14 percent for stores open over a year.
Shares were down over 10 percent on the day it came out, and continued to drop 7.25 percent the second day when B. Riley’s analyst cut the price target to zero. The continuous stream of disappointing earnings in the past several years could indicate that time may soon run out for this once prominent player in the electronics retail business.
Radio Shack is not going out of business. Radio shack is a very popular store to shop and purchase a variety of objects that are becoming even more popular every day. As more and more items are invented and updated radio shack will have more products to sell. So they are not going out of business.