During the Superbowl on Feb. 2, Radio Shack aired and eerily prophetic television commercial during the game when they had actors, athletes, and icons from the 1980's coming into the store and ransacking everything, including the displays and store shelves. The theme of the commercial was of a reconstituting of the old store format into a new modern and technologically friendly experience.
However, it appears that the commercial prophetically forecast Radio Shack's first move when it completely emptied the store during the first segment of the advertisement. On Feb. 4, Radio Shack announced they were permanently closing 500 stores in the coming months as a restructure of its corporate model appears to be occurring long before the restructure of their store layouts.
If it seems like it was exactly a year ago that turmoiling retailer Radioshack shut down 500 stores due to lack of consumer interest in its wares (and or consumer disposable cash), it is because it was. So how does Radioshack demonstrate its morbid sense of humor on the one year anniversary of said announcement? Well, by closing another 500, or about 12% of the retailer's total 4500 outlets currently in existence.
The WSJ reports that the company which once was the butt of all LBO-rumor jokes (and still is, only this time in the context of an M&A-rumor with JCPenney and/or the Joseph A. Wearhouse joint venture), is "planning to close around 500 stores in the coming months as the electronics retailer continues working with advisers to restructure the company." - Zerohedge
Part of Radio Shack's slow demise over the past 20 years has been its inability to adapt to financial trends which now allow customers to simply replace broken electronics equipment much cheaper than by attempting to fix individual components on older models. Coupled with industry and manufacturing being off-shored to locations like China and India, the retail concept has receded into a store front for cheap imported goods like radio controlled (RC) toys and obsolete hardware components.
What Radio Shack used to provide as a one stop shop for batteries, cables, and other electronics has now become specialized elsewhere with retailers such as Batteries Plus, Cell Phone outlets, and Apple stores. And of course, much of what Radio Shack provided local consumers can be found cheaper on the internet through online retailers such as Tiger Direct and Newegg.
It may be too little too late for Radio Shack, even as they spend millions of dollars on a cute Superbowl commercial to remind Americans of their relevance. And to both Wall Street and Main Street, the closing of another 500 stores around the country at the same time they hope to reveal a fresh and new store outlay is not a great start during a time of economic recession, and less consumer spending.