After being de-listed by the New York Stock Exchange and told they had defaulted on a note payable to Salus Capital, one of its larger creditors, RadioShack, a known, trusted brand in computers, electronics, radio and everything in between; will be known as one more thing in what is likely its final days: debtor-in-possession.
While filing for a reorganization bankruptcy [Chapter 11] as opposed to a straight liquidation [e.g., Chapter 7], it IS possible that RadioShack could emerge from bankruptcy with new owners and a new mission statement; but it’s just as likely the chain will be liquidated, and the property taken over for other business interests.
Entering into an agreement with Sprint and Standard General, RadioShack plans to sell upwards of 1500 of its stores to the Sprint/Standard General venture; and the fate of the remaining stores and operations, as of yet, remain anyone’s guess — and likely, left up to the Court or RadioShack’s major creditors.
Founded nearly 100 years ago as Tandy Leather, its expansion into Radio and electronics in the early 20th century caused Tandy to take off. Becoming a trusted source for information and components for the consumer in an age where it wasn’t very feasible otherwise. While the United States was in the midst of the Great Depression, Tandy was listed on the New York Stock Exchange, with the ticker ‘TAN.’
Selling it’s first consumer-grade radio telephone in the mid 80s, and then reorganizing as a company of its own [spinning off the name ‘Tandy’ that it was formerly a division of], RadioShack entered into the publicly traded arena in its own right, gaining the NYSE ticker ‘RSH’ in 2000.
The 2000s were a time of great flux for RadioShack, changing its business model to what it thought consumers wanted, but unfortunately, it wasn’t able to do so. Often viewed as an “overpriced cell phone store,” after RadioShack made its business model depend on cell phone sales, and shifted away from having Sales Associates who were more knowledge-based to sales-based — as well as taking much of the responsibility of running day-to-day operations from the local stores and centralizing them in Fort Worth; what seems like a bunch of little decisions were seemingly a death sentence for the nearly century-old retailer.
Admittedly, this is personal for me — because I grew up in RadioShacks, particularly Store 6776 in Plainfield… it was one of the delights of my trip to be able to be in the back room, seeing how the back office of RadioShack worked, read the training manuals, the geek courses that Associates took [before they got rid of that…] and feel like I actually worked there as a kid in a lot of ways. It’s kinda like seeing the clubhouse you played in as a kid being torn down…
So… here we are. Does RadioShack live on… or die after a long, anemic spiral downward post-Bankruptcy? We’ll see.