Is Radio Shack Bankrupt?
http://www.stockwisedaily.com/radioshack-corporation-rsh-says-its-running-out-of-cash/235550/
RadioShack seems to be running out of funds fast to fully stock their store and pay their employees. The company claimed their sales went down by a whole 20% making them rethink their strategy and to hopefully find better ways to bounce back.
The company may have to get rid of some stores and let off some of their employers to focus on some of the main stores that bring in the most revenue. They may even consider the fact that they will have to sell out. These 4,500 stores only brought in about 30 million worth of sales which is roughly six grand per store, thats no where near enough money to keep a business running.
Now with its investors, a lot are either selling stock or waiting for the perfect moment to sell because their is no confidence that the company is going to bounce back. The stock price has dropped nearly 96% with the stocks costing no more than 55 cents.
I personally have been to Radio shack whether its for iPhone chargers or batteries or little electronic devices that I don't want to have to purchase at a massive store like a Best Buy, yet It's rare that one will visit the store frequently unlike a grocery store or a pharmacy. When I am purchasing an item at radio shack there is no one ever there and theres about three personal on staff. Not every company can survive and we will see if Radio Shack will be revived.
I feel that Radio Shack simply has lost its appeal to the American consuming public. Personally, I think the stores are a bit outdated; they are something that I associate with the 90s. The shops appear tired and antiquated compared to those of their top competitors such as Best Buy, Wal-Mart and Verizon Wireless. The few times that I have shopped there, I also noticed that I was the only customer, outnumbered by staff. I think that in order to survive, Radio Shack must rebrand itself, creating an entirely new and updated image for the consuming public.
ReplyDeleteI knew Radio Shack was not performing well in recent years, but did not realize it had got this bad. In another article I read that Radio Shack was about to run out of cash and would be forced to liquidate or plan for bankruptcy. The company employees more than 27,000 people, which would be a lot of people to lay off. Radio Shack has plans to shut down at least 1,000 of its stores this year alone. Right now, Radio Shack is considering a nearly $585 million financing package from Standard General LP and invest bank UBS AG.
ReplyDeleteRadio Shack has had a difficult time competing with online "catalog" retailers. At least for me, its main function as a store was to sell highly specific parts to electronics or hobby-related items, people wouldn't go to Radio Shack just to browse. When people already have in mind what they want to buy, it has become exceedingly easier to order it online. Unless Radio Shack provides a unique and valuable service, it will be outclassed.
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ReplyDeleteI agree with Ally. I think Radio Shack is going to have to rebrand itself if it wants to compete. I think a good place for Radio Shack to start is with its name. Few people consistently listen to the radio when they're in their car, at work, or working out. Most people have an iPod. I think somehow incorporating the technological advances that have occurred in the past 10 years in a new name would be a smart first step.
ReplyDeleteI can see why Radio Shack is down in sales when looking at other entities who deliver the same goods plus more. Like you mentioned, Best Buy is exceptionally above and beyond radio shack and from personal experience, cheaper. I believe when people go to stores for one specific item, they also like to view whats out there on the market even without the intentions to buy. The layout of Best Buy compared to Radio Shack just doesn't compare. Best Buy has the enormous television displays, several computers for consumers to try personally, home appliances, and Radio Shack can't compete with that. Radio Shack thrived at one point but companies have exceeded them much beyond their measures.
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