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A struggling RadioShack will permanently close the doors on 1,100 US stores as the result
of a weak holiday season.
The company broke the news in a statement Tuesday claiming a fifth of its stores would
fold. Executives cited lower store traffic, intense promotional competition, and logistics
issues as the roots of the problem.
The New York Times reports RadioShack's yearly losses continued to slip exponentially in
2013.
The chain ended last year $400 million lighter, while in 2012, its total losses were only
$139 million. Not to mention, revenues shrank to $935.4 million in the fourth quarter, down
from $1.17 billion during the same time last year.
This is the second time this year the electronics retailer has threatened to close stores. CBS
news reports back in the beginning of February,
"The Journal also says RadioShack is going to close 500 stores. The retail chain has
more than 4,000 stores nationwide, but has been struggling for two years." (Via CBS)
The leader trying to patch the holes in this RadioShack is recently-hired CEO Joseph C.
Magnacca. In the statement, he remained optimistic and confident the Shack was headed into 2014
with a new image.
"Our brand equity remains strong, reflected in the sales growth we're seeing in our new
Concept Stores which redefine the RadioShack store experience." (Via RadioShack)
Under Magnacca's leadership, part of that "experience" was reflected in a new Super
Bowl ad, which aired this year -- and probably cost it a good chunk of change.
"The 80s called. They want their store back." (Via RadioShack)
Even though it's notably missing Howie Long, The Shack designed the ad to shed its tired,
beige storefront and introduce customers to a new shopping experience.
Under its new mantra, "Do It Together", RadioShack is betting a refreshed store and instant,
in-store help will keep consumers coming back.