Radio Shack reported back in August that it was struggling to stay afloat when it disclosed in a regulatory filing with the SEC that, it would be unable to finance its operations “beyond the very near term,” raising doubts about its future in business. However, it has since brought on a “chief revitalization officer” in the form of Harry Wilson and secured a line of credit. Wilson oversaw the restructuring of General Motors and Chrysler after the Treasury Department bailed them out.
Radio Shack had planned on closing 1100 of its stores but, had to rethink that idea once it was clear that they would not be able to receive financing if they did. The Motley Fool outlined the good, the bad, and the ugly of Radio Shack’s financial situation and it is clear that much is riding on this holiday season to see whether Radio Shack can stay in business. There is the very real possibility that even with a great holiday season of buying, it still may not be enough to keep the store in existence because, “The same market forces that drove Circuit City and Sixth Avenue Electronics to oblivion, and were almost the undoing of Best Buy, are the ones driving Radio Shack’s troubles today.”
