The End is Nigh for RadioShack
Rumors are circulating today that RadioShack is (finally) going to go out of business. Sources say that the retailer is working out a bankruptcy deal which would close half of the remaining stores and sell the store leases for the rest to Sprint.
Bloomberg reports that the deal is still under negotiation, and it could fall through at any time. Should that I happen i would expect that this retailer will file for bankruptcy within days, and start liquidating stock and firing staff within weeks.
That would be a sad end to a nearly 100 year old company which at one time was a leading electronics retailer with thousands of locations across the US. But given that RS had been slowly choking to death over the past couple decades, it’s also not in any way a surprise.
The only real question left with RadioShack is what will happen to its store leases (the future of the 800 odd franchise stores is also in doubt). If Sprint picks up half of the stores, that still leaves around 2,000 leases to either be paid off or snapped up by another retailer.
I don’t know of another chain retailer who would be interested – not in this economy – but it would not be utterly crazy for Amazon to use this opportunity to get its start in brick-and-mortar retail. Amazon could cherry-pick the leases and buy just the ones in the best locations, and then open the retail stores that all those rumors predicted.
So far, the closest Amazon has gotten to retail are pop-up stores, a retail partner down in Brazil with mall kiosks, and partnerships with a few college bookstores, but everyone keeps saying that the retailer will get physical.
I know that I’ve snickered at most of the rumors of Amazon opening physical stores, but ever since I learned that offline retail dwarfs online retail, I’ve believed that Amazon will eventually have to open some kind of store.
And this might be Amazon’s chance.
image by Nicholas Eckhart