NEW YORK CITY—Can a new prototype save RadioShack?
This week, the company opened 23 remodeled stores in the Washington, DC area, after opening 21 in the San Francisco area last week, adding to the more than 40 concept stores opened since July 2013. The prototypes are highly interactive, featuring a mobile device repair program with same-day service for many smartphones, tablets, etc., an interactive speaker wall and headphone demo stations that allow shoppers to compare products with music installed in in-store tablets, and touchscreens and apps that explain products.
"As we've opened more than 40 concept stores over the past year, customers have expressed their desire to interact with products before they buy, find personalized technology solutions and, of course, gain access to top brands. These interactive remodel stores represent what consumers should expect to see from the RadioShack brand,” said Mike DeFazio, senior vice president of store operations at RadioShack in the press release.
In RadioShack's first quarter conference call in June, CEO Joseph Magnacca reported that the 38 concept stores open at that time were performing well, with double-digit sales growth. The company also has introduced programs to help it find unique merchandise, including an invention challenge with Quirky to find new toy ideas. The company also is targeting the DIY electronics customer with new partnerships with parts makers.
That should be the sign of a healthy, growing retailer, but RadioShack is anything but. The company is hemorrhaging money, losing $98 million in the first quarter, following losses over the last two years. (The company reports second quarter results next week.) Plans to close more than 1,100 of its 5,000 stores were delayed because they can't reach agreements with lenders. Instead, some 200 stores will be shuttered annually for the next three years, forcing the company to spend what little cash it has to keep them operational. And RadioShack recently received a continued listing standards notice from the New York Stock Exchange because its stock had traded below $1.00 per share for more than 30 consecutive trading days.
Yet some analysts think they company can be saved. Are a new design and new merchandise enough to revitalize RadioShack?
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