tag:blogger.com,1999:blog-1527840491496268397.post8038588829926447901..comments2024-03-08T11:20:30.095-07:00Comments on Credit Bubble Stocks: "Even CEO Can't Figure Out How RadioShack Still In Business" $RSHUnknownnoreply@blogger.comBlogger3125tag:blogger.com,1999:blog-1527840491496268397.post-77751235744028346402014-04-21T11:53:22.311-07:002014-04-21T11:53:22.311-07:00The business has declined precipitously just in th...The business has declined precipitously just in the past few years. (It had a billion dollar market cap two years ago!)<br /><br />According to the financials, the business is half third-party cellphone sales and half electronics business. However based on store visits, it's like going to a cell phone store - people standing around waiting for help with their cell phone or cell phone plan.<br /><br />You can see the problem with that from the income statement though: revenue of $125k per employee, only 40% of what a BBY employee achieves. <br /><br />At the RSH average profit margin, that's only $42,500 in gross profit per employee. Even with really cheap employees you don't have much for rent, marketing, and other expenses.<br /><br />If this is like most retailers, there are unprofitable stores that they need to close.<br /><br />The other thing they need to do is reduce the interest burn rate by converting into equity. CPhttps://www.blogger.com/profile/12701174164478027499noreply@blogger.comtag:blogger.com,1999:blog-1527840491496268397.post-76723092850907506402014-04-21T02:53:55.332-07:002014-04-21T02:53:55.332-07:00When my 92-year-old father lost his hearing aid, t...When my 92-year-old father lost his hearing aid, the custom hearing aid outlet inside Sears quoted him $5,500 to replace. So he went into a Radio Shack and bought himself an iPod sized amplifier and headphones for $45, which worked surprisingly fine. When he lost that, I tried to get him a replacement at Best Buy, but they only had a much more complicated device for $90.Steve Sailerhttps://www.blogger.com/profile/11920109042402850214noreply@blogger.comtag:blogger.com,1999:blog-1527840491496268397.post-84754995820131772482014-04-18T07:25:01.897-07:002014-04-18T07:25:01.897-07:00I went to my local RadioShack for the first time i...I went to my local RadioShack for the first time in years last week. The purpose of/conditions surrounding my visit may give you some insight into the typical customer type.<br /><br />1) Proximity - there are literally zero electronics retailers within a 20 minutes drive of my house, with the exception of this small RadioShack, which is 5 minutes away. I am 20 minutes from a Target, which has a rather limited selection. I am at least a 30 minute drive to the nearest BestBuy, and I don't care to go there anyway since the store is located in one of those outdoor mall type places that is constantly a mob scene.<br /><br />2) I had just spent over an hour on the phone after work with Comcast trying to diagnose an internet issue. Finally, they determined I needed a new cable modem. Normally I would just order one from Amazon Prime and wait two days, but my kids and wife enjoy Netflix during the day. Where am I going to find a cable modem at 8:30pm? You guessed it. I called and they had two models that would work with Comcast. <br /><br />Long story short, I can't imagine a RadioShack store can survive if it isn't significantly more convenient to shop at than another retailer. <br /><br />Full disclosure: I owned the 7.375 notes that matured in 2011. Have not be involved since.Jasonnoreply@blogger.com