RadioShack Shuttering 20% of its Outlets -- 1,100 Stores to Close
Published on: 4th Mar 2014
Note -- this news article is more than a year old.
Struggling US consumer electronics retailer, RadioShack has announced that it is closing 1,100 of its just over 5,000 retail stores. Following the closures, the company aims to have over 4,000 stores including over 900 dealer franchise locations.
The company blamed the decision on lower store traffic, intense promotional activity particularly in consumer electronics, a very soft mobility marketplace and a few operational issues.
The company therefore posted a decline in its quarterly revenues of USD935 million, compared to USD1.17 billion a year earlier.
The operating loss for the fourth quarter was $166.1 million compared to operating income of $16 million a year earlier. As a result, the net loss deepened to $191.4 million ,compared to net loss of $63.3 million in the fourth quarter of 2012.
Joseph C. Magnacca , chief executive officer, said "Without minimizing the challenges ahead, we have a detailed strategic path to profitability based upon the five pillars of our turnaround,"
The company did not say when the store closures would take place, nor how many staff are likely to be made redundant as a result.
RadioShack has struggled against the twin forces of larger stores offering wider product ranges, and online shopping taking the hardened core customers away. The firm has traditionally aimed at charging a small premium for superior customer service, but that model is looking dated in the US retail market now.