RadioShack Reports Poor 2013 Holiday Season, Closing 1,100 Stores
March 4, 2014 2:55 PM
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These 1,100 stores represent about a fifth of its total
After a harsh holiday season with deeper cuts than expected, RadioShack is
closing 1,100 stores
across the U.S.
These 1,100 stores represent about a fifth of its total, with about 4,000 stores remaining once the closings are complete.
RadioShack originally planned to only close about 500 stores after a disappointing holiday season in 2013, but the now that the numbers are in, the electronics chain more than doubled that number to match its losses.
The drop in holiday sales for 2013 left RadioShack with a loss of $400 million USD for that year.
For Q4 2013 specifically, RadioShack reported a $191.4 million loss, which was much worse than the $63.3 million loss a year earlier. Revenue also fell 20 percent to $935.4 million.
[SOURCE: Seeking Alpha]
To top it off, RadioShack shares dropped 28 percent in early trading after the company reported that store sales decreased by 19 percent over the holiday quarter.
"Our brand equity remains strong, reflected in the sales growth we're seeing in our new Concept Stores which redefine the
store experience," said
Joseph C. Magnacca
, chief executive officer. "We have also been encouraged by the positive response to our new brand positioning around 'Do It Together,' which we kicked off with our award winning Super Bowl commercial. Importantly, our key hires during the fourth quarter in merchandising, global sourcing, planning and allocation and, more recently, our new chief financial officer, round out our new leadership team as we continue to re-build the business."
The company said that causes for the poor holiday season was better deals from rivals, reduced shopping traffic and weak sales in smartphones and tablets, which accounts for about half of the company's sales.
Radio Shack isn't the only electronics chain suffering from weak sales due to better deals from online competitors. In 2012, the chain gave a list of
50 store closings
in the U.S. and also
closed its UK stores
earlier that year.
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The grand irony
3/4/2014 4:04:02 PM
The grand irony of all of this is that they were right on with their Superbowl commercial: The '80s called and they want their store back! Back in the '80s and early '90s The Shack was a great place to pick up capacitors and other odds and ends. It was like a Lowes or Home Depot for electronics repair, and it was awesome!
With the rise of the Maker Movement you would think that a place like Radio Shack could really make a comeback... but no, it is all about overpriced 5 year old RC cars and cell phones. They still have components, but they are crammed away in the back, with no intelligent staff to help you out, and priced so prohibitively that even a nun would give it up for less.
If they are not going to give us our '80s store back, then they can get what they deserve.
"If you can find a PS3 anywhere in North America that's been on shelves for more than five minutes, I'll give you 1,200 bucks for it." -- SCEA President Jack Tretton
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