Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
The last time I went into a RS was about 6 months ago. Prior to that, it had been MANY years. I went in to see if they had clips to attach coax cable to the wall. Basically a half hoop with a nail on one end. The electronic component section which use to be the pride and joy of RS was basically non-existent. They didn't have my clips so I went to Home Depot. There were plenty there.
The thing that bothered me in the article above is that they don't have the money to close stores. I'm definitely no business wiz, but why does it cost so much money to close a store? You walk in, tell everyone that tomorrow is your last day. You have a truck pick up all the remaining merch and drive it back to a RS warehouse. The next day, the doors are locked and the store is closed. Businesses close doors all the time. I've never heard a business owner say they don't have the money to close the doors. Don't confuse this with, I cannot close my business because then I can't pay my bills, that is completely different.
"The struggling electronics retailer has been trying to close 1,100 of its 5,000 stores since March, but it's an expensive undertaking. It only came up with enough cash to close 175 stores through the end of October. "
To quote another article "Closing stores is an expensive undertaking. It requires cash for paying severance, liquidating merchandise and paying penalties to exit leases early."
To quote another article "Closing stores is an expensive undertaking. It requires cash for paying severance, liquidating merchandise and paying penalties to exit leases early."
I can understand the penalties due to breaking the lease, but when they plan to close 1100 and only close 175, something just doesn't add up. Also, severance packages? I call BS on this. If anything you have a store full of part timers and 1 or 2 managers. Only the managers would get a severance and even then, it wouldn't be that much. About the liquidation, don't liquidate. Shuttle the merch to another location that isn't closing or return the merch to the manufacturer. If you want to have a fire sale, that's one thing, but the cost to liquidate shouldn't be a factor unless they are closing ALL locations and it is a last ditch effort to make some money before you shut your doors for good and the brand folds on itself.
To quote another article "Closing stores is an expensive undertaking. It requires cash for paying severance, liquidating merchandise and paying penalties to exit leases early."
Right - everything changes when you're going out of business and your creditors know it.
You don't have lines of credit available to pay severance pay, unemployment, leases and/or penalties, etc. I mean, they are going out of business because of cash flow basically - they don't have it, so they don't have it to spend.
At least with the stores open, they do have some sales.
They've been laying off employees for years now and are operating with a skeleton crew.
I can understand the penalties due to breaking the lease, but when they plan to close 1100 and only close 175, something just doesn't add up. Also, severance packages? I call BS on this. If anything you have a store full of part timers and 1 or 2 managers. Only the managers would get a severance and even then, it wouldn't be that much. About the liquidation, don't liquidate. Shuttle the merch to another location that isn't closing or return the merch to the manufacturer. If you want to have a fire sale, that's one thing, but the cost to liquidate shouldn't be a factor unless they are closing ALL locations and it is a last ditch effort to make some money before you shut your doors for good and the brand folds on itself.
As far as the severance pay and packages go, there's a lot more to RS than the retail stores. They have many other employees at the corporate level. When stores close, those employees also lose their jobs - from the HR clerk to the Vice President eventually.
They also get to whip out shareholders, give bond holders massive haircuts and break leases at locations. They also need to hire folks to do BK process. It is a good thing long term.
Target just put all its Canada stores in Bankruptcy today
I can understand the penalties due to breaking the lease, but when they plan to close 1100 and only close 175, something just doesn't add up. Also, severance packages? I call BS on this. If anything you have a store full of part timers and 1 or 2 managers. Only the managers would get a severance and even then, it wouldn't be that much. About the liquidation, don't liquidate. Shuttle the merch to another location that isn't closing or return the merch to the manufacturer. If you want to have a fire sale, that's one thing, but the cost to liquidate shouldn't be a factor unless they are closing ALL locations and it is a last ditch effort to make some money before you shut your doors for good and the brand folds on itself.
Shipping is a big cost as well.
They're probably so bad off that they can't get credit extensions or find a vendor who will take the risk to work with them.
Radio Shack did not evolve with the times. They got killed by similar products being sold at a better price at other electronics stores, including Wal-Mart. They used to have employees who knew about electronics. Those days are over.
Shipping is a big cost as well.
They're probably so bad off that they can't get credit extensions or find a vendor who will take the risk to work with them.
See, this is where I think VPs and CEOs have lost touch with the reality of little things. Seriously, rent a UHaul for 100 bucks, fill it to the brim with the remaining merch and drive it to the warehouse or other stores. It is the mentality of the people in charge that crack me up. This is no different then when you move yourself. You are strapped for cash, but only look at the top moving companies to move you. The cheapest moving company will charge you 5 grand and you think that this is your only option.
My point is, if they REALLY wanted to close the stores, they could have made it happen.
Well, I totally agree that RS dropped the ball BIG TIME over the years - over and over again.
My brother in law worked at the corporate level with RS - in fact, he and his wife both did. He saw the writing on the wall years and years ago. Even so, he waited till they laid him off, because he knew he'd get a severance package and unemployment, which would buy him time to find another job (which he did, so it's all good). Can't say that I blame him but this does point to some of the hidden costs of closing down a business. He had enough cushion for about 8 months - and he wasn't even upper management.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
