RadioShack’s Reckless Abandon
Damian is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
RadioShack Repositioning Itself
I ventured into my local RadioShack (NYSE: RSH) today. I was immediately hit with a wall of mobile phone options from all the major carriers. I also witnessed a resetting of display which enhanced Apple’s iPad, and iPhone displays although the iPads are behind glass so you can’t touch them. All of this is additional evidence the company is persistently moving away from the Shack which served transistor tinkerers of years past and trying to capture any remaining mobile market share in an already saturated market. Sure, you can still find various soldering tools and drawers of capacitors if that activity amuses you, but the company is desperate to reposition itself as a mobile product franchise not unlike Best Buy’s (NYSE: BBY) smaller, more profitable mobile-only stores. But at what cost does this desperate change come?
You Are Going to Replace What?
Ironically I was in RadioShack to replace several bulging capacitors inside my LG plasma screen TV which currently won’t power on. This all started because my local TV salesperson told me they might be able to replace the failing circuit board for about $900 (including labor) if it was even possible or the implied option of course was I could buy a new TV for $1,500-$1,800. This unexpected possible expenditure led me to research online and discover that by replacing just the capacitors, not the entire circuit board, I could restore my plasma TV to its original working condition. Better yet, these capacitors, were a little more than $1 a piece plus about 30 minutes of my own labor time. Not a bad option for someone who can follow video directions found all over the internet. The good news, I thought of going to RadioShack first, the bad news, they didn’t carry the exact capacitor I needed. To make matters worse, my now disassembled TV lay waiting in my family room for repair. Not only did they not carry the part, but the employee offered the 'helpful' suggestion that if I wasn't able to find the item on RadioShack's website at first, to keep digging a little bit once I get there and keep looking. So it was back to the internet for me.
I understand perfectly why RadioShack might not stock the exact 3300 uf 10v radial electrolytic high temperature capacitor I was looking for, but I don’t understand why it couldn’t be ordered for me while in the store. Homeward bound, a quick Google search and within 30 seconds, I had located the exact capacitor on Amazon (NASDAQ: AMZN). Amazon through its many partnerships was able to provide the exact product I needed, and have it shipped to my home within 3 business days. Although RadioShack is one of Amazon's partner stores, my web search did not produce that result. Perhaps another nail in the coffin of this former transistor retailer. Instead of abandoning formerly niche products, why wouldn’t RadioShack continue to promote these products online? I wasn’t surprised they didn’t stock the item. However the ability to place an order for me, and have the items shipped to my home, albeit old-school, should have been a no-brainer. Even struggling bricks-and-mortar bookstores offer this simple convenience. As I had mentioned in an earlier blog, retailers need to combine the online and in-store experience for the customer if you expect them to walk through your door. ‘Yes,’ has to be the only answer when a customer asks, “Can you order that for me?”
Dead Man Walking
It is painfully obvious to me why RadioShack and other retailers are finding it increasingly difficult to pull consumers into their stores. They must exceed the expectations of the tech-savvy consumer who believes he can fix his own plasma TV (thanks to 20 minutes of research online). I don't believe the saturated mobile market is going to allow this company to turn itself around. If retailers leave it up to the consumer to find the answer on their own, rather than give them the answer they want, then don’t expect them to keep coming back. Customers will easily figure out how to do it themselves, and maybe even save a little money too!
Dubbles has no positions in the stocks mentioned above. The Motley Fool owns shares of Amazon.com, Best Buy, and RadioShack. Motley Fool newsletter services recommend Amazon.com. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.If you have questions about this post or the Fool’s blog network, click here for information.