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Cellular Phone Forum / Providers / Cingular / April 2006RadioShack shares hit low on downgrade, analyst cites Cingular as cause for the downgrade.
"Shares of RadioShack Corp. hit a 52-week low on Monday after an analyst said the electronics retailer's transition to selling Cingular products appeared to be "more difficult" than expected, and downgraded the stock." "http://www.businessweek.com/ap/financialnews/D8GOJ1BG0.htm?campaign_id=apn_home_ down&chan=db" >"Shares of RadioShack Corp. hit a 52-week low on Monday after an analyst >said the electronics retailer's transition to selling Cingular products >appeared to be "more difficult" than expected, and downgraded the stock." > >"http://www.businessweek.com/ap/financialnews/D8GOJ1BG0.htm?campaign_id=apn_home_ down&chan=db" Continuation of a long downhill slide by Radio Shack due to poor management in a more challenging business environment.  SignatureBest regards, SEE THE FAQ FOR CINGULAR WIRELESS AT John Navas <http://en.wikibooks.org/wiki/Cingular_Wireless_FAQ> > [POSTED TO alt.cellular.cingular - REPLY ON USENET PLEASE] > [quoted text clipped - 7 lines] > management in > a more challenging business environment. Rubbish. >"Shares of RadioShack Corp. hit a 52-week low on Monday after an analyst >said the electronics retailer's transition to selling Cingular products >appeared to be "more difficult" than expected, and downgraded the stock." > >"http://www.businessweek.com/ap/financialnews/D8GOJ1BG0.htm?campaign_id=apn_home_ down&chan=db" Anyone who grew up with Radio Shack would not recognize the store in its present reincarnation. It appears to be positioned as a "Circuit City Lite", but often situated in the same place where other electronics discounters carry the same stuff, have more variety, and usually at lower prices. Granted, you can't make big profits selling resistors and diodes in this market anymore, but even taking that into account ... I have fewer and fewer reasons to visit Radio Shack with each passing month. <snip> > Anyone who grew up with Radio Shack would not recognize the store in its > present reincarnation. It appears to be positioned as a "Circuit City [quoted text clipped - 3 lines] > in this market anymore, but even taking that into account ... I have fewer > and fewer reasons to visit Radio Shack with each passing month. The reason I posted this is because, at least in my area (San Francisco Bay Area), the Radio Shack managers and franchisees have been livid over the lost revenue in wireless sales since Radio Shack stopped selling Verizon, and started selling Cingular. There was a report in February that said pretty much the same thing, but now, with three months of sales, the evidence is more concrete. Radio Shack became too dependent on the huge profits from signing up new wireless customers. Just as in the past they were too dependent on whatever new market they fell into, be it CB radios, home computers, etc. ><snip> > [quoted text clipped - 10 lines] >the lost revenue in wireless sales since Radio Shack stopped selling >Verizon, and started selling Cingular. Actually just another made up fantasy of yours. >There was a report in February >that said pretty much the same thing, Nope. >but now, with three months of >sales, the evidence is more concrete. Wrong on that too. The actual evidence is that Radio Shack dumped Verizon in favor of Cingular due to poor results in 2005. >Radio Shack became too dependent on the huge profits from signing up new >wireless customers. Just as in the past they were too dependent on >whatever new market they fell into, be it CB radios, home computers, etc. Radio Shack is simply the victim of its own mismanagement. SignatureBest regards, SEE THE FAQ FOR CINGULAR WIRELESS AT John Navas <http://en.wikibooks.org/wiki/Cingular_Wireless_FAQ> > [POSTED TO alt.cellular.cingular - REPLY ON USENET PLEASE] > [quoted text clipped - 16 lines] > > Actually just another made up fantasy of yours. Not according to ALL published reports- care to post something to indicate otherwise? >>There was a report in February >>that said pretty much the same thing, > > Nope. Yes there was- sticking your head in the sand does not make it untrue. >>but now, with three months of >>sales, the evidence is more concrete. > > Wrong on that too. The actual evidence is that Radio Shack dumped Verizon > in > favor of Cingular due to poor results in 2005. The actual evidence is that Verizon Dropped Radio Shack- at least try to get your facts straight, moron. >>Radio Shack became too dependent on the huge profits from signing up new >>wireless customers. Just as in the past they were too dependent on >>whatever new market they fell into, be it CB radios, home computers, etc. > > Radio Shack is simply the victim of its own mismanagement. Then you are admitting that taking on Cingular was a bad management decision. Thanks for agreeing. I agree entirely. It is a company that has just not moved with the times. I suspect that most of their customers are old timers who have not got up to speed with the idea of online purchases, and are yet to discover Best Buy and Circuit City. The only time I've ventured into Radio Shack were when I find myself short of a resistor and dont want to justify spending $5 postage/packing for a 5cent component! So instead, I spend $1.50 in Radio Shack. Prices suck, products suck. > I agree entirely. It is a company that has just not moved with the > times. I suspect that most of their customers are old timers who have [quoted text clipped - 3 lines] > to justify spending $5 postage/packing for a 5cent component! So > instead, I spend $1.50 in Radio Shack. Prices suck, products suck. People still go there to buy an occasional cable or connector or odd battery, but that's obviously not enough to stay in business. Also, they really over-expanded. There were once six stores within a ten minute drive of my house, and four of them have closed. The mall stores seem to have done the poorest. "http://www2.townonline.com/wellesley/businessNews/view.bg?articleid=461542" >> I agree entirely. It is a company that has just not moved with the >> times. I suspect that most of their customers are old timers who have [quoted text clipped - 6 lines] > People still go there to buy an occasional cable or connector or odd > battery, but that's obviously not enough to stay in business. Also, they Yeah, that's pretty much what I use them for. Cheap cables and sometimes a weird sized battery. Best Buy/Circuit City charge exorbitant prices for cables! Though I have noticed when I've been in RS that they have more phone selections and cheaper phone prices than a Cingular store. -Jason > People still go there to buy an occasional cable or connector or odd > battery, but that's obviously not enough to stay in business. Also, they > really over-expanded. There were once six stores within a ten minute drive > of my house, and four of them have closed. The mall stores seem to have > done the poorest. I went to two different stores awhile back for some 50 ohm coax, acouple pl259 connectors and something else. Neither store had any of it. Radio Shack is of no further use to me. >> People still go there to buy an occasional cable or connector or odd >> battery, but that's obviously not enough to stay in business. Also, they >> really over-expanded. There were once six stores within a ten minute drive >> of my house, and four of them have closed. The mall stores seem to have >> done the poorest. >I went to two different stores awhile back for some 50 ohm coax, acouple >pl259 connectors and something else. Neither store had any of it. Radio >Shack is of no further use to me. Pretty much the same for me too. Before Radio Shack I now try Home Depot (yes, Home Depot), Pacific Electronics & Comms (in Dublin, recommended), and even Frys. Only thing I've bought at Radio Chack in months was a stereo mini jack to RCA plug connection, and I had to buy two cables to do it. SignatureBest regards, SEE THE FAQ FOR CINGULAR WIRELESS AT John Navas <http://en.wikibooks.org/wiki/Cingular_Wireless_FAQ> >> People still go there to buy an occasional cable or connector or odd >> battery, but that's obviously not enough to stay in business. Also, they [quoted text clipped - 5 lines] >pl259 connectors and something else. Neither store had any of it. Radio >Shack is of no further use to me. The amount of shelf space devoted to such things is dwindling to nothing; further, it seems they do not re-stock when things run out. I have almost no reason to visit the stores anymore. > The amount of shelf space devoted to such things is dwindling to nothing; > further, it seems they do not re-stock when things run out. I have almost > no reason to visit the stores anymore. They have experimented with various ways of reducing the shelf space for such items. They use divided drawers similar to what Home Depot uses for the more esoteric hardware items, and they use the vertical panels that stick out from the wall on hinges, and they use those sliding panels to be able to have multiple levels of hooks. It costs a lot to have so many SKUs of small items. It's too bad to see them faltering like they are. I don't know that there's anything they could do to turn the chain around. Subsidizing component sales with revenue from wireless sales is not a business plan. >>"Shares of RadioShack Corp. hit a 52-week low on Monday after an analyst >>said the electronics retailer's transition to selling Cingular products [quoted text clipped - 9 lines] > in this market anymore, but even taking that into account ... I have fewer > and fewer reasons to visit Radio Shack with each passing month. I was a RS store manager from '71-'74, when Citizens Band Radios were all the rage. Back then Radio Shack emulated Sears, with virtually every item sold having the Radio Shack brand name. Their stereo components were adequate, at best. The high end receivers were rebadged Hitachis, and they sold a couple of West German turntables by Miracord, with Radio Shack branded cartridges by Shure. They were not the V-15 Type III, that the high end audio dealers carried, but some lesser model, which Radio Shack represented as being "top-of-the-line." Their CB radios were junk, not like the ones manufactured by Johnson, but RS had stores everywhere, and they had a certain band of followers. They always got their customers' names and addresses whenever a purchase, however insignificant, was made, and they sent out monthly sales flyers and offered free catalogs every August. I haven't seen a monthly flyer in many years, and last time I asked for a "free catalog," they told me I had to pay. I declined. Without that catalog in the hands of their customers, their sales dropped through the floor. I remember absolutely that customers came in to the store with a specific item in mind--and they often had the catalog number when they asked for it. Sure, we tried to sell accessories or upsell the order to something better, but it was the CATALOG that got the customer into the store in the first place. We didn't have a high percentage of browsers that turned into impulse buyers, like Best Buy or Circuit City has today. Part of the problem was that the stores were all small--little electronics boutiques--not the "big box" stores that invited browsing. Customers were reluctant to walk in because they were within sight of the store manager all the time, and they felt uncomfortable just looking and then leaving without making a purchase. The stores were set up to encourage customers to walk in with an intention to make a specific purchase. And RS always gave out frivolous premiums, like their free "Battery-of-the-Month" card (how silly! Maybe Wally & The Beaver came down the store to get their free transistor radio 9-volt battery every month, but that was back in the days when they had "transistor radios.") Every fall they offered a cheap 'Five-Cell Flashlight," as an inducement to get people to come out for their free catalog (and we were expected to turn those "free flashlight" customers into buyers of the 5 D-Cells that were needed to make the flashlights work). There was no prestige in being a Radio Shack store manager--just 54-60 hour weeks (and that was when their stores were closed on Sundays). It was drudgery, and we kept being made fun of for selling third-tier goods, rather than the name brands that were advertised in the audio magazines. The combination of selling resistors along with "high-end" high fidelity components was not very sound. Buyers didn't feel good about buying audio components from the same place that sold batteries, diodes and cheap (and illegal) telephones to hobbyists. Once the big box stores began selling "real" audio (and video) components, RS looked pretty dowdy by comparison. What really killed them were those "Tandy" computers. They even opened up a line of stores dedicated to selling, installing and servicing Tandy computers and Tandy business telephone systems. That lasted only a few years, then they all closed. No respectable business would be caught dead with computers bearing the name "Tandy." They were always below spec when compared to IBM. And I still remember when Radio Shack computers had CASSETTE RECORDERS, rather than hard drives or floppy drives! They sold toys, under the guise of professional equipment, and their customers were mainly truckers, basement hobbyists and uneducated tinkerers. They have never been able to shake off that reputation. Even today, their managers, district managers and regional managers are primarily high-school educated folks. No MBAs or engineers work at Radio Shack! They have been eclipsed by better competitors, and I believe that they will wither and eventually die a natural death. I read recently that they are closing a large number of stores this year. >>>"Shares of RadioShack Corp. hit a 52-week low on Monday after an analyst >>>said the electronics retailer's transition to selling Cingular products [quoted text clipped - 83 lines] > will wither and eventually die a natural death. I read recently that they > are closing a large number of stores this year. As a former Radio Shack salesman, I remember selling huge volumes of low margin, low priced junk and a few cutting edge devices; portable calculators at 269.95 each - 4 "AAs" AND 2 9-Volt batteries w/ add, subtract, multiply, divide - no memory, no % key, no scientific functions. We were the only place in town to buy the things and sold between 65K and 100K gross sales per month in a town of under 100000 people. Audio sales dropped off when "Playback" (now defunct) opened their doors. I also owned "Trash 80" computers, when IBM PC Jrs were 5000 bucks. To this day, I still pick up resistors, caps and assorted "parts" that I need in small quantities in a hurry, but with the end of the catalog and the advent of Best Buy and Circuit City, Radio Shack has lost its mass market appeal. Hobbyists can now buy online from a host of sources and if the general public can compare all the wireless brands in one stop at the big box locations,and shop for everything from audio, video and computers to washers and dryers at the same place, why go across the street to RS? I agree with Jeremy, Tandy Corp's days are numbered without some kind of paradigm shift in their market. Mark (Who remembers Allied Radio) <snip> > I agree with Jeremy, Tandy Corp's days are numbered without some kind of > paradigm shift in their market. They need "the next big thing." Cellular, with its huge bonuses for new customers, just couldn't have continued forever. Verizon just got tired of paying those spiffs to Radio Shack, when there were so many more economical ways to distribute their products. > Mark > (Who remembers Allied Radio) Remember when Allied and Radio Shack "Got Married" and send out free dollar coupons as the wedding gift! Allied Electronics is still around actually, as a subsidiary of some other company. I actually ordered something from them not too long ago. The real question is who remembers Olson Electronics and Lafayette Radio Electronics? Olson gave away free pearls for every $10 you spent. At least Jameco, formerly James Electronics, has survived. I bought mail-order from them in the early 1970's, then worked directly across the street from them when I moved to California. John Navas wrote: > Actually just another made up fantasy of yours. - >> There was a report in February >> that said pretty much the same thing, - > Nope. - >> but now, with three months of >> sales, the evidence is more concrete. - > Wrong on that too. The actual evidence is that Radio Shack dumped Verizon in > favor of Cingular due to poor results in 2005. - > The reason I posted this is because, at least in my area (San Francisco > Bay Area), the Radio Shack managers and franchisees have been livid over > the lost revenue in wireless sales since Radio Shack stopped selling > Verizon, and started selling Cingular. There was a report in February > that said pretty much the same thing, but now, with three months of > sales, the evidence is more concrete. SMS said in the above quote that Radio Shack stopped selling Verizon, not that Verizon dumped Radio Shack. I wrote in a previous thread: >From Forbes "People To Watch The Week Ahead: Feb. 13-17" "For Radio Shack's new Chief Executive David Edmondson, the task is tough but simple: Get more people into the stores buying wireless phones. The company has taken a bigger sales hit than expected from its decision to dump Verizon Wireless last year in favor of Cingular as its main provider of wireless service, a big profit driver." http://www.forbes.com/markets/commodities/2006/02/10/twx-icahn-playboy-cx_vc_021 1peopletowatch.html > "For Radio Shack's new Chief Executive David Edmondson, the task is > tough but simple: Get more people into the stores buying wireless [quoted text clipped - 3 lines] > > http://www.forbes.com/markets/commodities/2006/02/10/twx-icahn-playboy-cx_vc_021 1peopletowatch.html Yes, this is true. Radio Shack admitted that the move to Cingular wasn't going well back in February. But now, with the first quarter over, the analysts apparently have more data on how bad it's going. It's also not accurate to say that Radio Shack dumped Verizon. In fact, Verizon simply wouldn't give Radio Shack the terms that Radio Shack demanded. In reality, it was Verizon that decided to end the relationship by not acceding to Radio Shack's demands. >> "For Radio Shack's new Chief Executive David Edmondson, the task is >> tough but simple: Get more people into the stores buying wireless [quoted text clipped - 12 lines] >demanded. In reality, it was Verizon that decided to end the >relationship by not acceding to Radio Shack's demands. Pure fantasy. SignatureBest regards, SEE THE FAQ FOR CINGULAR WIRELESS AT John Navas <http://en.wikibooks.org/wiki/Cingular_Wireless_FAQ> > Pure fantasy. I say: Pure hearsay. How can you be a Cingular sycophant and yet know so much about the details of the split-up without any written proof from the media? What I mean to say is that the statement that 'Radio Shack dumped Verizon' is simplistic. That statement by itself does not give any details. What did actually happen to cause the split-up? Will we ever actually know the DETAILS? >What I mean to say is that the statement that 'Radio Shack dumped >Verizon' is simplistic. That statement by itself does not give any >details. What did actually happen to cause the split-up? Will we ever >actually know the DETAILS? Taking all of the press releases, analyst reports, and press accounts as a whole, I think it's pretty clear that Radio Shack switched from Verizon to Cingular as part of its turnaround plan from disappointing results in 2005. SignatureBest regards, SEE THE FAQ FOR CINGULAR WIRELESS AT John Navas <http://en.wikibooks.org/wiki/Cingular_Wireless_FAQ> >>What I mean to say is that the statement that 'Radio Shack dumped >>Verizon' is simplistic. That statement by itself does not give any [quoted text clipped - 4 lines] > whole, I think it's pretty clear that Radio Shack switched from Verizon to > Cingular as part of its turnaround plan from disappointing results in 2005. If you ran Radio Shack and Verizon dumped you, which of the following would you publish? 1. Verizon dumped us, so we now sell Cingular. 2. We switched from Verizon to Cingular as part of our enhanced sales plan for 2006. SignatureAll relevant people are pertinent. All rude people are impertinent. Therefore, no rude people are relevant. -- Solomon W. Golomb > If you ran Radio Shack and Verizon dumped you, which of the following > would you publish? > > 1. Verizon dumped us, so we now sell Cingular. > 2. We switched from Verizon to Cingular as part of our enhanced > sales plan for 2006. Clearly Radio Shack underestimated the strength of Verizon. They must have known from all the surveys by Consumer Reports, JD Power, and Consumer Checkbook, exactly what consumers thought of their wireless carriers, but they believed that Radio Shack customers could be persuaded to switch carriers. Radio Shack also saw a benefit in changing because they make more money if they persuade someone to switch, rather than just putting them back under contract for another two years. All they had to do was to convince all their Verizon customers to switch to Cingular. What they failed to realize is that wireless customers have become much more savvy over the past five years or so. Customers no longer go just by who gives them the most minutes per dollar, or which phone has the most dumb features. This works in Verizon's favor since they have the best network, even though their handset selection is not very good. >> If you ran Radio Shack and Verizon dumped you, which of the following >> would you publish? [quoted text clipped - 4 lines] > >Clearly Radio Shack underestimated the strength of Verizon. Just the opposite -- Radio Shack was suffering from poor sales of Verizon, as the 2005 financial results make clear. >What they failed to realize is that wireless customers have become much >more savvy over the past five years or so. Customers no longer go just >by who gives them the most minutes per dollar, or which phone has the >most dumb features. This works in Verizon's favor since they have the >best network, even though their handset selection is not very good. Nonsense. SignatureBest regards, SEE THE FAQ FOR CINGULAR WIRELESS AT John Navas <http://en.wikibooks.org/wiki/Cingular_Wireless_FAQ> >>>What I mean to say is that the statement that 'Radio Shack dumped >>>Verizon' is simplistic. That statement by itself does not give any [quoted text clipped - 11 lines] >2. We switched from Verizon to Cingular as part of our enhanced >sales plan for 2006. No need to speculate -- here are the facts, which make it clear that Radio Shack dumped Verizon based on poor performance and financials, not the other way around: February 17, 2005 Radio Shack projects 2005 sales growth of 9% to 11% and earnings per share growth from $2.34 to $2.40. March 18, 2005 RadioShack Corporation (NYSE: RSH) today announced that its first quarter 2005 earnings per share estimate will not meet its previously stated forecast of $0.39 to $0.41. The company believes first quarter earnings per share are more likely to be $0.30 to $0.34. In addition, the company said it is unlikely to achieve its previously stated 2005 full year earnings per share guidance of $2.34 to $2.40. RadioShack expects to update its full year earnings guidance at its regularly scheduled first quarter earnings release date, April 19. "Business trends have underperformed our expectations," said David Edmondson, president and chief executive officer - elect. "This has been driven by a recent deceleration in wireless sales in our core stores and, to a smaller extent, underperformance in our battery business." April 19, 2005 RadioShack Corporation (NYSE: RSH) today announced net income of $55 million or $0.34 per diluted share for the quarter ended March 31, 2005 versus net income of $68 million or $0.41 per diluted share for the quarter ended March 31, 2004. Total sales in the first quarter of 2005 were up 3% to $1,123 million, compared to total sales of $1,093 million for the previous year. First quarter 2005 comparable store sales were down 1% versus the prior year. "We are disappointed that our business did not perform as we originally expected during the first quarter. Our profits were lower due primarily to underperformance in the wireless business within our core RadioShack stores," said David Edmondson, president and chief executive officer-elect. "Our non- wireless businesses improved in first quarter 2005, compared with first quarter 2004. RadioShack remains a very profitable business overall, but our focus clearly must be on turning our wireless business around, while continuing to improve our non-wireless businesses." RadioShack established fiscal year 2005 diluted earnings per share guidance of $1.80 to $1.90. July 19, 2005 RadioShack Corporation (NYSE: RSH) today announced net income of $52.3 million or $0.33 per diluted share for the quarter ended June 30, 2005 versus net income of $68.3 million or $0.42 per diluted share for the quarter ended June 30, 2004. Total sales in the second quarter of 2005 were up 4% to $1,092.2 million, compared to total sales of $1,053.8 million for the previous year. Second quarter 2005 comparable store sales were down 1% versus the prior year. "Our profit decline in the second quarter was driven by lower comp store sales and more specifically by weakness in our core store wireless business," said David Edmondson, president and chief executive officer. ... Total wireless sales were up 2% due to growth in RadioShacks kiosk channel offset by a decline in sales of wireless in its company stores. July 31, 2005 RadioShack Corporation (NYSE: RSH) today announced that it has entered into 10-year and 11-year agreements, respectively, with Cingular Wireless and Sprint PCS to be the companys long-term wireless providers in RadioShack stores nationwide. Cingular and Sprint have also committed to support RadioShack Corporations strategy of expanding retail distribution outside of the core RadioShack stores. RadioShacks new agreement terms with Cingular and Sprint are projected to be more financially favorable over the life of the agreements relative to the financial model under which RadioShack operates today. The new agreements are expected to provide RadioShack with more profits in the short- and long-term and significant future growth opportunities due to entrance into the GSM market, addition of Nextel products and services (pending their merger with Sprint), and opportunities for expanded distribution. October 21, 2005 "We made important progress during the third quarter to better position ourselves for the holiday selling season and the long term," said David Edmondson, president and chief executive officer. "We made aggressive moves on inventory and finished deploying operating procedures which will improve the customer experience in our stores. We also finalized long-term wireless agreements and returned value to shareholders through an overnight share repurchase transaction which better positions us as a corporation." SignatureBest regards, SEE THE FAQ FOR CINGULAR WIRELESS AT John Navas <http://en.wikibooks.org/wiki/Cingular_Wireless_FAQ> > No need to speculate -- here are the facts, which make it clear that Radio > Shack dumped Verizon based on poor performance and financials, not the other > way around: [References snipped out] I don't see any reference to Cingular or Verizon specifically mentioned. > [POSTED TO alt.cellular.cingular - REPLY ON USENET PLEASE] > [quoted text clipped - 7 lines] > Cingular as part of its turnaround plan from disappointing results in > 2005. Please don't think, John- we wouldn't want you to hurt yourself. And you are far from educated enough on the subject for your "thoughts" to have any usable meaning. > What I mean to say is that the statement that 'Radio Shack dumped > Verizon' is simplistic. That statement by itself does not give any > details. What did actually happen to cause the split-up? Will we ever > actually know the DETAILS? I think that we'll never know the actual terms that Radio Shack demanded, or what Verizon offered. Suffice it to say, that they couldn't come to an agreement on terms, and the result is that Radio Shack no longer sells Verizon service. We do know that Radio Shack is suffering because they no longer sell Verizon on the same terms they did up until the end of 2005. "Sluggish sales in high-profit categories such as wireless products and losses resulting from the termination of a sales agreement with Verizon Wireless contributed to the decline." ("http://www.tmcnet.com/usubmit/-retailer-closing-9-area-locations-moves-part-radi o-/2006/03/29/1516601.htm") Maybe Verizon's offer to Radio Shack was so poor that even if Radio Shack had continued on Verizon's terms, that their results would still have been bad. >> What I mean to say is that the statement that 'Radio Shack dumped >> Verizon' is simplistic. That statement by itself does not give any [quoted text clipped - 5 lines] >come to an agreement on terms, and the result is that Radio Shack no >longer sells Verizon service. Nice try (not even), but what's clear from its own financial press releases (that I posted here earlier) is that Radio Shack was disappointed in Verizon sales, which it blamed as being the major factor in its disappointing results for 2005. >We do know that Radio Shack is suffering because they no longer sell >Verizon on the same terms they did up until the end of 2005. We do know that Radio Shack suffered in 2005 due to lower than expected sales of Verizon wireless. >"Sluggish sales in high-profit categories such as wireless products and >losses resulting from the termination of a sales agreement with Verizon >Wireless contributed to the decline." > >("http://www.tmcnet.com/usubmit/-retailer-closing-9-area-locations-moves-part-radi o-/2006/03/29/1516601.htm") Again, not even a nice try. Press releases from the full year 2005 shows that Verizon was dumped by Radio Shack due to poor sales and poor returns. >Maybe Verizon's offer to Radio Shack was so poor that even if Radio >Shack had continued on Verizon's terms, that their results would still >have been bad. Their results were so bad early in 2005 that Radio Shack dumped Verizon in favor of Cingular. SignatureBest regards, SEE THE FAQ FOR CINGULAR WIRELESS AT John Navas <http://en.wikibooks.org/wiki/Cingular_Wireless_FAQ> > [POSTED TO alt.cellular.cingular - REPLY ON USENET PLEASE] > [quoted text clipped - 16 lines] > > Pure fantasy. No it's not- Verizon chose to eliminate that sales channel. Spin it any way you want- the truth is that Radio Shack got dumped. > No it's not- Verizon chose to eliminate that sales channel. Spin it any > way you want- the truth is that Radio Shack got dumped. There are costs associated with each sales channel. Semiconductor companies deal with this a lot. Do you go through a distributor, and incur the costs charged by the distributor, do you go direct and incur those costs yourself, or do you do both. If you can't come to mutually agreeable terms with a distributor, then that channel is eliminated. Radio Shack's problem is that they were doing very well with Verizon, but that Verizon didn't want to continue with the high cost of the Radio Shack channel. Now that they switched to Cingular, and their results have been disappointing with Cingular, they're stuck. >> No it's not- Verizon chose to eliminate that sales channel. Spin it any >> way you want- the truth is that Radio Shack got dumped. [quoted text clipped - 9 lines] > channel. Now that they switched to Cingular, and their results have been > disappointing with Cingular, they're stuck. Exactly. >> No it's not- Verizon chose to eliminate that sales channel. Spin it any >> way you want- the truth is that Radio Shack got dumped. [quoted text clipped - 6 lines] > >Radio Shack's problem is that they were doing very well with Verizon, The clear evidence is that they *weren't* doing well with Verizon. >but that Verizon didn't want to continue with the high cost of the Radio >Shack channel. Now that they switched to Cingular, and their results >have been disappointing with Cingular, they're stuck. No worse than with Verizon. SignatureBest regards, SEE THE FAQ FOR CINGULAR WIRELESS AT John Navas <http://en.wikibooks.org/wiki/Cingular_Wireless_FAQ> > [POSTED TO alt.cellular.cingular - REPLY ON USENET PLEASE] > [quoted text clipped - 11 lines] > > The clear evidence is that they *weren't* doing well with Verizon. And yet you have been unable to post "clear evidence"- all I've seen are third tier reports that fail to categorically state your claim. You simply repeat yourself like a child not wanting to hear the truth. How typical. How sad. Verizon decided to discontinue the sales channel. Live with it. > And yet you have been unable to post "clear evidence"- all I've seen are > third tier reports that fail to categorically state your claim. You simply > repeat yourself like a child not wanting to hear the truth. How typical. > How sad. All you can go by is what Radio Shack and the analysts say. They all agree that the major reason for Radio Shack's current woes is the change from Verizon to Cingular. You have to accept their explanation unless you have reason to believe that they are lying. >> And yet you have been unable to post "clear evidence"- all I've seen are >> third tier reports that fail to categorically state your claim. You simply >> repeat yourself like a child not wanting to hear the truth. How typical. >> How sad. > >All you can go by is what Radio Shack and the analysts say. Indeed. >They all >agree that the major reason for Radio Shack's current woes is the change >from Verizon to Cingular. They actually all agree that disappointing sales of Verizon is the reason Radio Shack switched to Cingular. >You have to accept their explanation unless >you have reason to believe that they are lying. You should take your own advice. SignatureBest regards, SEE THE FAQ FOR CINGULAR WIRELESS AT John Navas <http://en.wikibooks.org/wiki/Cingular_Wireless_FAQ> >John Navas wrote: >> Actually just another made up fantasy of yours. [quoted text clipped - 19 lines] >SMS said in the above quote that Radio Shack stopped selling Verizon, >not that Verizon dumped Radio Shack. Not really. What he's actually written is: They need "the next big thing." Cellular, with its huge bonuses for new customers, just couldn't have continued forever. Verizon just got tired of paying those spiffs to Radio Shack, when there were so many more economical ways to distribute their products. <http://groups.google.com/group/alt.cellular.cingular/msg/c2d8269828e81dfd?dmode= source&hl=en> It's also not accurate to say that Radio Shack dumped Verizon. In fact, Verizon simply wouldn't give Radio Shack the terms that Radio Shack demanded. In reality, it was Verizon that decided to end the relationship by not acceding to Radio Shack's demands. <http://groups.google.com/group/alt.cellular.cingular/msg/07b3fd987f1043b7?dmode= source&hl=en> SignatureBest regards, SEE THE FAQ FOR CINGULAR WIRELESS AT John Navas <http://en.wikibooks.org/wiki/Cingular_Wireless_FAQ> > [POSTED TO alt.cellular.cingular - REPLY ON USENET PLEASE] > [quoted text clipped - 38 lines] > > <http://groups.google.com/group/alt.cellular.cingular/msg/07b3fd987f1043b7?dmode= source&hl=en> And your point? ><snip> > [quoted text clipped - 17 lines] >The real question is who remembers Olson Electronics and Lafayette Radio >Electronics? Olson gave away free pearls for every $10 you spent. Not to mention Burstein-Applebee, Poly-Paks, Newark, and other bygones. The closest now is Digi-Key, I guess; but they don't have stores. > Not to mention Burstein-Applebee, Poly-Paks, Newark, and other bygones. The > closest now is Digi-Key, I guess; but they don't have stores. Oh, no. I still have a credit from Poly-Paks. The strangest item from Poly-Paks was their "Used ROMS, may have some useful codes." > Not to mention Burstein-Applebee, Poly-Paks, Newark, and other bygones. The > closest now is Digi-Key, I guess; but they don't have stores. Newark is still around, as part of some other company. Jameco is more hobbyist oriented than Digikey, which has become more like what Newark and Allied used to be, as a supplier to industrial customers. For hobbyist stuff, the best place I've found is All Electronics (http://allelectronics.com/). JDR is still around doing mail-order, though they closed their retail store. It's very hard to do retail on components. Fry's still has some components, but nothing like when they first started, and they rarely restock anything--I'm sure that soon they'll find a better use of their floor space. It's too bad about Radio Shack. Wireless sales have subsidized the rest of the store, and now there are just better channels for the carriers than having to pay the big bucks to Radio Shack. The second tier carriers may continue at Radio Shack for a while, but eventually they'll get tired of giving away the store as well. >It's too bad about Radio Shack. Wireless sales have subsidized the rest >of the store, and now there are just better channels for the carriers >than having to pay the big bucks to Radio Shack. The second tier >carriers may continue at Radio Shack for a while, but eventually they'll >get tired of giving away the store as well. What "second tier" carriers? Radio Shack carries Cingular and Sprint-Nextel, which are both first tier carriers (by any reasonable definition). SignatureBest regards, SEE THE FAQ FOR CINGULAR WIRELESS AT John Navas <http://en.wikibooks.org/wiki/Cingular_Wireless_FAQ> > The real question is who remembers Olson Electronics and Lafayette Radio > Electronics? Olson gave away free pearls for every $10 you spent. Olson in Chicago was right across the street from Allied Radio. When I went down to Allied for anything I made it a point to visit Olson. Later Olson opened at least one store in the 'burbs. SignatureAll relevant people are pertinent. All rude people are impertinent. Therefore, no rude people are relevant. -- Solomon W. Golomb >They have been eclipsed by better competitors, and I believe that they will >wither and eventually die a natural death. I read recently that they are >closing a large number of stores this year. <http://yahoo.reuters.com/stocks/QuoteCompanyNewsArticle.aspx?storyID=...> LIFTING THE LID: RadioShack under pressure after CEO admission Fri Feb 17, 2006 6:48 PM ET Senior executives then launched a roughly 3-hour long presentation, broadcast over the Internet, discussing the earnings results and turnaround plan, which could cost up to $100 million and close up to 700 stores. SignatureBest regards, SEE THE FAQ FOR CINGULAR WIRELESS AT John Navas <http://en.wikibooks.org/wiki/Cingular_Wireless_FAQ> >>>"Shares of RadioShack Corp. hit a 52-week low on Monday after an analyst >>>said the electronics retailer's transition to selling Cingular products [quoted text clipped - 13 lines] >the rage. Back then Radio Shack emulated Sears, with virtually every item >sold having the Radio Shack brand name. [snip] >They >always got their customers' names and addresses whenever a purchase, however [quoted text clipped - 9 lines] >order to something better, but it was the CATALOG that got the customer into >the store in the first place. Right on the money for me, and probably many of the tech-inclined posters you will see on this newsgroup. For me, the demise of the Radio Shack catalog was the final blow, as it signalled the beginning of the end. "Mike S." <retsuhcs@xinap.moc> wrote in message news:e0tmri$hn3 > For me, the demise of the Radio Shack > catalog was the final blow, as it signalled the beginning of the end. I didn't know that they discontinued the catalog!!! When did that happen?? Are they still sending out mailings to their customers, or have those stopped, too?? No wonder I never see anybody in their downtown stores--without the catalog and the advertising, people tend to just pass RS stores by, without even noticing them. If I wanted an electronic item--a CD Walkman, a receiver, a television, a monitor--I'd probably check out Wal-Mart first, and Best Buy/Circuit City next. I wouldn't think of Radio Shack at all--and this coming from a guy that was a manager of 4 different RS stores over a 2.5 year period! Now that seems like it was in a past life! I visit a RS store, maybe annually, for stuff like phone cable or connectors--but they can't possibly pay the rent on those stores just from the revenue they get from small parts sales. Their sales-per-square-foot must be in the sub-basement, versus that of other stores. They have always been oriented toward the small-town, low-volume, "friendly local merchant" business model. That worked back in the 50s, but downtown shopping areas in the US are now dumps for "dollar stores" and five-and-tens. Nobody does any serious shopping in those places anymore, when there are malls nearby with free parking, upscale merchandise, and good-looking babes strolling around during the summer season . . . RS has backed themselves into a corner, and I cannot think of any way out. Except for small parts and hobbyist customers, they've lost out to the big box stores, and even the customers know it. And I would not even think of buying cellular service at a RS, not when I can walk into any company-owned wireless store and deal directly with company employees, that presumably are closer to the source than those blue-collar, glorified CB radio salesmen at RS. > RS has backed themselves into a corner, and I cannot think of any way out. > Except for small parts and hobbyist customers, they've lost out to the big > box stores, and even the customers know it. They were surviving on wireless sales. Sign up a few new customers per day, and you've made more than selling a thousand bits and pieces of hardware. This is why losing Verizon, no matter who's decision it was (and of course it was a mutual parting of the ways after being unable to come to terms acceptable to both parties), has had such an effect. Verizon is the premium quality carrier, and has the most appeal to customers who finally have learned to look at more than just how many peak minutes you get for (which of course is why Verizon had no need to drop their pants on spiffs to Radio Shack). Circuit City decided to concentrate on two carriers, each with a different focus, Verizon for coverage and quality, T-Mobile for price and hipness. Radio Shack is muddling in the middle with no focus. Costco is going gangbusters in wireless now, with Sprint, T-Mobile, and Verizon. >> RS has backed themselves into a corner, and I cannot think of any way out. >> Except for small parts and hobbyist customers, they've lost out to the big [quoted text clipped - 5 lines] >(and of course it was a mutual parting of the ways after being unable to >come to terms acceptable to both parties), has had such an effect. The real start of the "effect" on Radio Shack was declining sales of *Verizon* and the failure to see much uptick from adding Nextel (as a result of the Sprint merger) in 2005. >Verizon is the premium quality carrier, and has the most appeal to >customers who finally have learned to look at more than just how many >peak minutes you get for (which of course is why Verizon had no need to >drop their pants on spiffs to Radio Shack). How silly. The vast majority of customers don't see any one carrier as "premium" -- they are simply looking for the best deal. The real problem for Radio Shack has been the rise of small cellular kiosks in places like malls, which have neutralized the distribution advantage that Radio Shack used to have. This is why Radio Shack is trying the strategy of, "If you can't beat them, join them." Whether or not that will work is of course an open question. >Circuit City decided to concentrate on two carriers, each with a >different focus, Verizon for coverage and quality, T-Mobile for price >and hipness. Radio Shack is muddling in the middle with no focus. Costco >is going gangbusters in wireless now, with Sprint, T-Mobile, and Verizon. More silliness: * Circuit City just did the best carrier deals it could get. Cingular wasn't an option due to the Radio Shack deal. * Radio Shack has two larger carriers, and is clearly better positioned than Circuit City. * Costco isn't a major factor in cellular. SignatureBest regards, SEE THE FAQ FOR CINGULAR WIRELESS AT John Navas <http://en.wikibooks.org/wiki/Cingular_Wireless_FAQ> > The real start of the "effect" on Radio Shack was declining sales of > *Verizon* > and the failure to see much uptick from adding Nextel (as a result of the > Sprint merger) in 2005. Any figures to back that up, or is this more opinion? >>Verizon is the premium quality carrier, and has the most appeal to >>customers who finally have learned to look at more than just how many [quoted text clipped - 3 lines] > How silly. The vast majority of customers don't see any one carrier as > "premium" -- they are simply looking for the best deal. And you are now the voice of the people? You need to live in reality to be qualified for that job. > The real problem for Radio Shack has been the rise of small cellular > kiosks in [quoted text clipped - 3 lines] > "If you can't beat them, join them." Whether or not that will work is of > course an open question. More opinion? >>Circuit City decided to concentrate on two carriers, each with a >>different focus, Verizon for coverage and quality, T-Mobile for price [quoted text clipped - 6 lines] > wasn't > an option due to the Radio Shack deal. Rubbish- the Radio Shack deal is not exclusive. > * Radio Shack has two larger carriers, and is clearly better positioned > than > Circuit City. Verizon is larger than Sprint- try again. > * Costco isn't a major factor in cellular. According to who? You?? >"Mike S." <retsuhcs@xinap.moc> wrote in message news:e0tmri$hn3 > >> For me, the demise of the Radio Shack >> catalog was the final blow, as it signalled the beginning of the end. And yet another Internet Myth takes wing. [sigh] >I didn't know that they discontinued the catalog!!! > >When did that happen?? The catalog still exists. You'll find it in the stores, and you'll see the catalog number when you look up an item online. >Are they still sending out mailings to their customers, or have those >stopped, too?? You can see the current weekly ad at <http://radioshack.shoplocal.com/radioshack/default.aspx?action=nuep&adref=rs.com>. >No wonder I never see anybody in their downtown stores--without the catalog >and the advertising, people tend to just pass RS stores by, without even >noticing them. IMnsHO even the name has become a liability. In the old days it was a cool statement that appealed to knowledgable electronics buffs. These days it sounds archaic and cheap (in the negative sense of the word), on the order of Mary's Pizza Shack. >They have always been oriented toward the small-town, low-volume, "friendly >local merchant" business model. That worked back in the 50s, but downtown [quoted text clipped - 11 lines] >company employees, that presumably are closer to the source than those >blue-collar, glorified CB radio salesmen at RS. The Shack appears to be moving toward a cellular kiosk (smaller than the average current store) distribution model, based on far greater coverage than carrier-owned stores, opening them as it closes the most unprofitable current stores. Whether or not that can be made to work is an open question. SignatureBest regards, SEE THE FAQ FOR CINGULAR WIRELESS AT John Navas <http://en.wikibooks.org/wiki/Cingular_Wireless_FAQ> > "Mike S." <retsuhcs@xinap.moc> wrote in message news:e0tmri$hn3 > [quoted text clipped - 4 lines] > > When did that happen?? A few years ago. First they started charging for the catalogs, and of course few people bought them. Then they figured no one wanted catalogs so they discontinued them. The catalog was a great marketing tool. But I guess they felt that the cost of producing it was too high. Part of the appeal of the catalog was being able to find the exact item you needed, and going to the store and telling the salesperson the number, so they could find it. Trying to explain what the item is often doesn't work. >Part of the appeal of the catalog was being able to find the exact item >you needed, and going to the store and telling the salesperson the >number, so they could find it. Trying to explain what the item is often >doesn't work. Now easily done online, faster and more efficiently as well. SignatureBest regards, SEE THE FAQ FOR CINGULAR WIRELESS AT John Navas <http://en.wikibooks.org/wiki/Cingular_Wireless_FAQ> |
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