For a company synonymous with the American electronics industry and RadioShack himself-owner Tandy Corporation, the rise of RadioShack was not expected by many. In 2015 the company filed for bankruptcy, and it seemed as if its legacy had disappeared. But in 2016, they resurfaced unexpectedly: as Amazon’s new smart home hub. In 2018 they began partnering with Sprint to sell electronic phones (at a lower price than Amazon), but also to sell products at some of their retail outlets. Now, as of 2019, RadioShack has decided to not just re-brand but return to its roots by opening its retail stores.
Scott Birnbaum, a former RadioShack CEO, said that the idea for Amazon’s smart home hub originated when it became apparent that the company needed to modernize. Birnbaum was not the only one who noticed the need for modernization in 2017; Tandy Corporation realized that changes were imminent and put RadioShack up for sale. Purchased by General Wireless in April 2018, the company announced an update of their stores in August 2018, when they reopened 9 test locations: three in Texas and six in Florida. “Tandy came to us and gave us a note saying they would close all the stores. They didn’t give us a lot of notice, and it was entirely up to us how we would close them,” said Birnbaum. “We had customers who were not happy. They need their retail store.” The company has yet to determine how many stores will open or when the first one will open, but several RadioShack locations have already received permits for new signage.
According to the New York Times Magazine article, RadioShack struggles with rising competition from electronics giants like Best Buy and Amazon, especially after several years of poor performance in sales and profits. Now, after changing its strategy and re-entering the electronic market, it will be able to stand out again. On March 19, 2017, RadioShack announced it would close 1,100 underperforming stores. The company has also announced plans to open an online marketplace and sell online orders in-store. This is a bold move for the company that just closed 1,000 stores and is bringing back some of its trademark colors: blue and yellow. “I put my foot down when they asked if I wanted to close them down, and they said yes…I said I’m not going to do it. It was a moral thing,” said Birnbaum.
After closing all of its stores in 2017, RadioShack has re-emerged as a new company focused on customer experience and product customer service. Birnbaum said that the company is trying to bring back the “fun” element for shoppers. “We’re not going to be a customer-service store; we want to take care of them and help them pick out what they need. We want to do that best in class. It’s got to be fun.” However, the question remains whether or not this new business model will succeed. Despite the less-than-stellar reputation of RadioShack, customers are still enamored by their products. In 2016, when RadioShack struggled to stay afloat and was under pressure to close its stores, fans flocked to their last-ever store party in Fort Worth, Texas. “People were coming out of the woodwork,” recalled Birnbaum. “They saw it as a last hurrah…customers knew they were going away, and they wanted one more chance to go in and say goodbye.”
After closing 1,000 stores and going bankrupt, the company has yet again opened stores. They have also started a partnership with Sprint to sell mobile phones, and as of 2019, they are opening retail stores. After closing all of its stores in 2017, RadioShack plans to open new ones. In 2018 they were able to get funding from several companies, including ABRY Partners, Golden Gate Capital, and Great American Group (TAG), to help them get back on their feet. Before their comeback, many people doubted their success and even called the return of RadioShack hopeless. Now, in 2019 they have already opened up two retail stores in Atlanta and Chicago. The other stores are in-store locations.
The relationship between RadioShack’s corporate headquarters and the retail stores is tense. Many stores do not have an official contract with Tandy Corporation, making it difficult to get things like new merchandise or technology.
