Radio Shack Closing 1,100 Stores

Electronics retailer Radio Shack has announced they will be closing 1,100 of their stores.

The news came about after reports of a dismal quarterly sale, especially over the holidays. The loss is calculated to be about 19% due to weak customer traffic, which also contributed to the company’s stock dropping 23 points. The planned closures will leave the Fort Worth, Texas-based chain with over 4,000 stores, including over 900 dealer franchise locations.

This is just another notch on the belt of Radio Shack‘s troubles. The Chicago Tribune has reported that sales have been dropping amid executive departures, tough competition and an image problem. Despite its presence, analysts say the U.S. retailer has not done enough to transform itself into a destination for mobile shoppers or become cool enough to entice younger shoppers.

It isn’t like Radio Shack isn’t trying to be competitive. It just seems they can’t catch a break. The Inquisitr has reported on the numerous successes and failures of the electronics retail company. This includes their exclusive HTC Inspiring 4G Coloring, bringing back iPhone trade-in and Foursquare offers, and their big Nokia Android fail.

CNN Money did include something interesting in their report about the company’s troubles. First, they have the largest footprint in the United States. 5,200 stores are located in places where 90% of the United States population are within minutes of one of those locations. If you compare them to other major retailers, such as Wal-Mart with their 3,700 locations and Best Buy with their 1,400 locations, they are over-stored.

Radio Shack also admitted to being out-of-date and in need of a massive design overhaul. Even their Superbowl commercial this year recognized this issue.

Probably the biggest issue for the failing chain is that they are a brick-and-mortar store. What this means is their business comes primarily from the traffic and sales of people actually coming into their store. Going across the occupational landscape, any store that is considered brick-and-mortar is in dire danger due to online retailers like Amazon.

Many people actually practice “showrooming” where they go to a brick-and-mortar store, find something they like, make a mental note of it, then go home to purchase it online at a cheaper price. Even Best Buy, one of Radio Shack‘s biggest competitors in electronic retail, has suffered to this kind of shopping and are closing stores in an effort to cut costs.

The large electronics retailer may be closing 1,100 stores across the country, but that does not mean it is closing for good. This may be what they need to revamp and make themselves competitive in today’s economy, especially in one that is struggling.