General Wireless Operations, the parent company of Radioshack, is looking set to file for Chapter 11 bankruptcy protection for the second time. Speculation is that the bankruptcy filing could officially take place as soon as next Tuesday. No one from General Wireless has made an official statement on this issue yet.
Another bankruptcy, more closed stores
Back in February 2015 Radioshack filed for its first bankruptcy and in the process sold about 2,400 of its stores in the United States to General Wireless for $160 million. In the process the company also got ownership of the brand.
General Wireless then took about 1,750 of those stores and set up Sprint stores within the Radioshacks so they can sell their services and smartphones. Now a little over two years later, the company has to file for bankruptcy again, with General Wireless already in the process of closing 200 stores. Sources also say that the company is in negotiations with Sprint and others about possibly closing even more store locations. There has also been some speculation that the company plans to close all of its company-owned retail stores.
The future of Radioshack
With the speculation that all stores could be closed amid a second bankruptcy the future of Radioshack is grim. The ninety-seven year old company had been the leading electronics chain for decades, best know for selling cables, connectors, CB radios, and other items.
However, with the rise of smartphones and online websites Radioshack has declined and has never been able to find a niche in this new era. As recently as 2013 there were around 5,000 stores in the United States, but now there are only a little more than 1,700.
Amazon.com has been the major culprit in the decline of traditional electronics stores, as it has continued to eat away and further dominate the market.
In 2009 Circuit City got liquidated and Best Buy struggled before stabilizing in recent years. Fellow electronics retailer HHGregg is also in the same boat, having filed for bankruptcy on March 6th, and said it would close one-third of its stores. None of this bodes well for Radioshack, who is arguably struggling the most.
