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Is it Impossible To Make An Original Observation?

December 12, 2007, 9:40 pm

A couple of posts ago, I wondered how Radio Shack still survives when CompUSA is now dead.  Thanks to a reader, I find that the Onion has already plowed this ground:

Despite having been on the job for nine months, RadioShack CEO Julian
Day said Monday that he still has "no idea" how the home electronics
store manages to stay open.

"There must be some sort of business model that enables this company
to make money, but I'll be damned if I know what it is," Day said. "You
wouldn't think that people still buy enough strobe lights and extension
cords to support an entire nationwide chain, but I guess they must, or
I wouldn't have this desk to sit behind all day."

The retail outlet boasts more than 6,000 locations in the United
States, and is known best for its wall-sized displays of
obscure-looking analog electronics components and its notoriously
desperate, high-pressure sales staff. Nevertheless, it ranks as a
Fortune 500 company, with gross revenues of over $4.5 billion and
fiscal quarter earnings averaging tens of millions of dollars.

"Have you even been inside of a RadioShack recently?" Day asked.
"Just walking into the place makes you feel vaguely depressed and
alienated. Maybe our customers are at the mall anyway and don't feel
like driving to Best Buy? I suppose that's possible, but still, it's
just...weird."

I give up.  But the whole Onion article is very funny and worth reading.

Tags: , ,
Category: General Business
  • Don Lloyd

    IMO, the primary Radio Shack competitive advantage is that all of the products in a RS branch are available within half an hour with no shipping costs.

    In addition, you can walk by every stocked product all the way to the back of the store in about the same linear distance that would only get you to the checkout counters of a Best Buy.

    But the key is that virtually every new electronic product has connectors that are incompatible with whatever you presently own. Every $100 you spend on a new electronic gadget needs $15 to $25 worth of RS cables and adapters to make it useful.

    Regards, Don

  • http://alfin2100.blogspot.com Al Fin

    Careful that you do not fall so thoroughly into the "trendy me" mindset that you lose touch with the mundane reality that runs the world.

    The old saying that he who invents a better mousetrap will find a path beaten to his door is still apt. Core business is dull. Oil? Operating systems? Glass products? Aluminum cans and plastic bottles? Cardboard boxes, foam and plastic packing materials. Nothing trendy about how Warren Buffett made money. Have you read Peter Lynch's books? Dull products, dull businesses.

    US Democrats can't understand why middle america could keep electing a republican president, either. The center is dull and stolid or it cannot hold.

  • Donald

    After reading these so called "news" blogs, I need to question if the quotes are really coming from Julian Day. It's hard to believe any CEO would say such thngs.

    I've worked for RadioShack for the past 10 years. The huge problem we have in our district is no advertising in the local papers.

    We do have many great deals. but no one knows. For black Friday, we had 500 dollar GPS's for 149 w/ a 50 dollar rebate, final cost 99 dollars. Many other items that we had cheaper than other retailers.

    Currently, RadioShack has free all-in-one printers w/ camera costing at least 100 dollars.

    4 GD thumb drives for 35 dollars, usually 99 dollars. These are just two examples, there are many more.

    If no one knows, how can we survive ? Our marketing department needs to wake up and realize the word needs to get out. You need to spend money to make money.

    As an employee and a stock holder, I am ashamed over the way the company is being handled internally. The employees are working very hard at our level.

    If the customers don't know about the deals, how can we go on ?

    - Donald

  • tsiroth

    Don, you sound so sad, I just have to let you in on the secret.
    Julian Day did not make the quoted statements that so concern you.
    The Onion is a humor publication, and the quotes are complete fabrications. They aren't writing news about Radio Shack, they are mocking Radio Shack.

  • Dan

    As a former Radio Shack employee (one of the larval forms of the systems adminstrator), I can say that a number of people have gotten things partly right.

    1. RS is the "Quickie-Mart" of the electronics industry. We were where the engineers at the local electronics company would go if they needed one of something today, rather than a case next week, like the catalogs provide.

    2. We were located between two big box electronics stores. It never seemed to occur to the big box salesdroids that people would actually want to connect the dvd player they were buying to the TV and stero that the already owned. Thus every time they moved a big screen, we picked up a $25 ticket for cables and connectors.

    3. RS has been in the industry long enough that people know that if they need some kind of gizmo, RS probably carries it. Our running joke was that a good RS salesperson should be able to adapt a K-band satellite antenna to connect to a 3/4" water pipe.

    4. For the last 15 years, the emphasis has shifted to such things as satellite TV systems and cell phones (formerly pagers) that generate an income stream for the retailer over the life of the service agreement, rather than just at the time of sale.

  • Larry

    A war story to make the point that Dan makes:

    Eons ago I was on a team of techs and engineers installing a (for the the times) huge voice network for a huge "Aerospace" company--I work for the telephone company that had the contract.

    The network connected a lot of places and was in fact a "miniature" version of the POTS network of the day. but there were oddities.

    For the war story the relevant oddity was that the design used #5 Crossbar switches to handle Class 2 and 3 traffic (they were designed to handle class 5 traffic) so the engineers had produced a gadget to allow the machine to dial numbers on it's terminating ("local") loop.

    The problem (as I and others in the trenches concluded from the evidence presented) with large-scale engineering is that the Switching Engineers would design the item to do the job that needed to be done. And handed their work off to the Transmission Engineers (never to see it again).

    The Transmission Engineers looked at the design and said "well, that is is all well and good, you may well be able to set up the connections they way you want to do, but people will not get the voice quality we are used to providing (things like that used to be Important to telephone companies), so they made the needed changes to the design and handed it off to the Packaging Engineers. (Again, with no expectation of ever seeing the design again.)

    The Packaging ... you can see where this train goes. Suffice to say they insured a design that would fit in the bays of a #5 office and handed off to the Maintenance Engineers who insured that the Master Test Frame would be able to do its thing, and handed the design off to the Manufacturing Engineers who could actually get the flipping things built and the Installation Engineers who did what was needed to get in the bays in the central offices and so on.

    Which brings me and others into the picture--testing and turn-up to the customer. The %#$@# things are in the bays, and all that, and if you can get a call setup, you can talk over them--but they won't switch calls which is, you may recall, what they were invented for.

    Cutting now to the chase, knowledgeable on-site engineers and technicians (of the latter which I was one although I'm not sure that term had been invented yet) were able to work out what was wrong and how to fix it.

    Several trips to Radio Shacks in the San Fernando Valley (and 4 other locations around the country) collecting .01 mfd (I think they were) Mylar capacitors later, the %#$@# not only were Manufactured and Installed (and could be controlled by the Master Test Frame), you could switch calls and talk over them.

  • http://wavewitch.com Hunt Johnsen

    Radio Shack is the one place I can walk into and find a soldering iron and some rosin core solder when I need it.
    Not to mention some of the more esoteric components like speaker wire.