RadioShack announced Tuesday it will close 1,000 of its under-performing locations in order to revamp its image in an increasingly competitive electronic world, USA Today reported.
The closings will leave the Texas-based electronics chain with roughly 4,000 stores in the U.S. The company did not announce how many jobs would be lost, according to the Associated Press.
RadioShack CEO Joseph Magnacca said they will close the lowest performing stores to save the rest of the company. But the loss is a big hit, since RadioShack's edge is its easy access.
"You lose some of that convenience store aspect they've relied on," Magnacca said according to USA Today. "You have to pass a RadioShack on the way to the grocer. If all of a sudden that store is closed, I'm not going to another RadioShack."
Though it has more stores than its competitor Best Buy, RadioShack is slipping, including a decline in sales and revenue over the past year. Revenue was down 20 percent to $935 million, and stores that have been open for a year saw a 19 percent decline in sales, USA Today reported.
The store's decline is attributed to an inability to compete with big-box discount stores and online retail. RadioShack tried to revamp itself as the premiere destination for wireless services. However that effort has stalled since more people now have smartphones and do not upgrade as often, the AP reported.
Another issue is the privately labeled products RadioShack sells, as opposed to brand named products like Samsung and Microsoft that draw customers. Analyst Scott Tilgham of B. Riley & Co. told USA Today that RadioShack's average store size of 2,400-square-feet is not big enough to offer a wide variety of products.
RadioShack is traditionally known as the premiere destination for batteries and rare electronics, the AP reported. The company is still continuing with its revamp attempts, but it's taking a little longer than anticipated, Magnacca told the AP.
