Radio Shack Goes BankruptDamien Moye
Since the 1920s, the Radio Shack franchise has led the way in technology and tech based products. Today, that era is all but over as Radio Shack goes bankrupt.
Radio Shack filed for Chapter 11 bankruptcy on Thursday, February 5, 2014. Part of the deal is they will sell up to 2,400 of their stores, as many as 60% of their physical shops to Standard General and many of these shops will be run by telecom giant Sprint Corporation. The bankruptcy has been months, if not years in the making. In 2014, there was talk of closing 1,100 stores (imagine the potential job loss), but lenders stopped that from happening. In December 2014, Radio Shack warned lenders if it didn’t get more support, it would be forced to file bankruptcy. In the past year, they lost over 66% of their stock.
Radio Shack was founded in 1921 as a mail order and small retail business specializing in radio equipment to the shipping community. It was founded in Boston, MA. In the decades that followed, it became one of the first franchises to sell many things technology. For instance, in 1947, they had the first showroom to sell speakers and turntables and other new items for the times. In 1959, they began selling CB radios, radios that weren’t really popular until the mid 1970s. In 1977, they sold their first personal computer, backed by BASIC operating systems, created by a young, little known techie named Bill Gates. It began selling cellular phones in 1984. The year before that, they sold and introduced the first laptop in history. So what I’m getting at is Radio Shack has been on the cutting edge of technology again and again. But ironically, it’s cutting edge technology that’s putting Radio Shack into bankruptcy. With the rise of Apple and Microsoft stores, online shopping, and other technology franchises, not too many people have the need for this long running franchise anymore. What will become of Radio Shack now?