RadioShack
Careers at RadioShack
Mission
RadioShack’s mission is to help customers get the most from their technology products.
Business segments
RadioShack is a provider of wireless and electronics products. The company operates two reportable business segments:
- Mobility – Includes pre-paid and post-paid wireless handsets, pre-paid wireless airtime, residual income, commissions, tablets, e-readers, and wireless/tablet accessories.
- Retail - Includes consumer electronics and related accessories, battery and power products, and technical products.
History
In 1921 Boston brothers Milton and Theodore Deutschmann wanted to sell equipment for the amateur radio market, which was in its early stages. They opened a store and launched a mail-order operation for this purpose. They called their new business RadioShack, a reference to the wooden structure that holds a ship’s radio equipment. This was appropriate as much of the company’s merchandise would be sold to ship radio officers, in addition to amateur radio operators.
RadioShack entered the high-fidelity music market in 1939, and published its first catalog the same year. In 1954 it started selling its first private label products. By the early 1960s, the company offered numerous consumer electronics, including walkie-talkies, speakers, and antennas. After growing to nine locations, it experienced financial difficulties. Businessman Charles D. Tandy of the Tandy Corporation came to the rescue and purchased the chain for $300,000 in 1962.
RadioShack became profitable again within two years. Within ten years of the acquisition, it was opening two new stores every day. The chain’s success was due to a number of Tandy’s strategies. He refocused its inventory on private label items to reduce middleman costs and keep prices competitive. He also increased spending on advertising, and offered high bonuses to top salespeople.
In the 1970s RadioShack entered the computer market. Sales of the burgeoning sector offset declining sales of CB radios. In the 1980s, it dived into the market for cellular phones. In the 1990s the company focused on expansion, rapidly increasing its number of stores. Despite these positive signs, in the 2000s it faced significant competition from specialty chains such as Circuit City and Best Buy, as well as from mass merchandisers such as Wal-Mart and Kmart. This problem contributed to declining sales, numerous store closures, and the chain ultimately filing for bankruptcy in February 2015. Its remaining stores were purchased by General Wireless and leased to Sprint Corporation.
Business model of RadioShack
Customer Segments
RadioShack has a mass market business model, with no significant differentiation between its customers. Its customer base primarily consists of individual consumers.
Value Proposition
RadioShack offers three primary value propositions: accessibility, price, and brand/status.
The company offers accessibility through its wide distribution. It operates 1,743 physical outlets across the United States. While this figure is a far cry from its previous peak of over 4,000 stores, it still makes it one of the largest electronics retailers in the country.
The company offers benefits in terms of price. A significant portion of its lineup consists of private label items. These are typically less expensive than brand-name items, offering consumers a bargain. In addition, RadioShack’s website offers many opportunities for savings. These include free shipping for all online purchases over $40, and “weekly ads” with specials such as “buy one, get one 50% off”.
The company has a high-profile brand. It was one of the very first specialty electronics chains, making it well-known and established. In addition, it was one of the top electronics retailers for many years. Despite its current status, its name still gives it an advantage in terms of shopper awareness.
Channels
RadioShack’s main channels are its collection of company-owned stores, of which there are 1,743, and its nearly 500 independent dealer locations. The firm’s outlets are primarily located in major shopping malls, strip centers, and individual storefronts. RadioShack also sells items through its website. The company promotes its offerings through that site, its social media pages, and online and TV advertising.
Customer Relationships
RadioShack’s customer relationship is primarily of a self-service nature. Customers utilize its products while having limited interaction with employees. That said, there is a personal assistance component in the form of e-mail support through its website.
Key Activities
RadioShack’s business model entails developing and manufacturing its products for customers. The company operates eight manufacturing plants in the United States and China.
Key Partners
RadioShack’s main partners are the major retail chains and the network of independent dealers who distribute its products.
Key Resources
RadioShack’s main physical resources are its manufacturing plants, its three distribution centers that ship products to retailers and dealer outlets, and its network of service centers that repair personal computers and consumer electronics products.
Cost Structure
RadioShack has a cost-driven structure, aiming to minimize expenses through low-price value propositions. Its biggest cost driver is cost of sales, a variable expense. Other major drivers are in the areas of sales/marketing and administration, both fixed costs.
Revenue Streams
RadioShack has two revenue streams:
- Product Sales - The revenues it generates from sales of its name-brand and private label products within its stores and online.
- Service Commissions – The revenue it generates from wireless service providers through commissions they pay for obtaining new customers (or upgrading existing customers).
