The writing was on the wall for Radio Shack over 35 years ago when I left the Company. Failure became impossible to avoid with the change of management culture in Fort Worth.
Instead of doing what they did best (finding and developing new products and markets) and promoting from within, Radio Shack went outside to hire Management. And the new guys at the helm tried to make money by cutting the payroll at the bottom of the foodchain, cutting back on R&D, and jumping on products that everybody else was selling. The big money was always generated at the bottom, in the stores, and getting cheap with the payroll drove the successful retail managers and salesmen out of the Company. the Repair Department was highly profitable, and successful until Management decided that the people were making too much money and kept changing the compensation plan to retain more of the money for Corporate, which caused the loss of profitability in the Repair Centers and the loss of skilled people.
I worked for Radio Shack as a salesperson, and as a store manager, and was eligible for promotion to a District Manager's Position, except for my age at the time. I was the youngest Store Manager in the Company History to that point, and my stores performed at the top of the Company Records each Month for Sales Gains, Net Profit After Bonus, Percentage of In-Stock Items, and Average Salesmen's Hourly Income. With the Company's Share added to my participation in the Stock Program, and Investment Programs, and the increase in value of the Shares I held, I figure I was making/getting paid $.15 out of every dollar spent by customers who walked into my stores, and even with what I was getting paid, the Company was clearing almost 25% of the gross sales in my stores as net profit. No other store managers were performing even close to where I was, and my people were happy because while the Minimum Wage was $1.65 an hour (that is what salespeople got if they didn't make commission), but my people were averaging closer to $5 an hour. That wasn't bad for a Minimum Wage Job in 1980.
The problem that developed was that the Company decided that I (and many other hard working people at the Retail Level) were making too much, and changed the compensation plan, so I would make less on the same amount of work. And I wasn't getting promoted like I figured I deserved (I was 22 when I was promoted to store management). I left the Company the first week of 1982. From that time, until Radio Shack declared bankruptcy (2015-2016?), the stock only split 2-3 times. During the 6 years I was employed at Radio Shack, the stock was split 2-3 times a year.
Sears has made the same mistakes (and continues with the same mistakes) that eventually brought Radio Shack down. No new products that the consumers will flock to Sears to buy. Hire the least expensive people to work in the stores, regardless of their inexperience. Poor stock levels in the stores, store management that understands retail needs to be in charge in each store. You can't sell what you don't have. Photos of the items you'd like to sell to the customer are worthless, when the customer wanders or drives to your store, and wants to touch the item, pay for it, and take it with him/her on the spot. Experienced Salespeople are needed to help guide foot traffic, and close sales. Inexperienced people on their first job, at minimum wage without a clue about the products the customers are interested in are not going to close sales.
Radio Shack made money hand over fist selling parts, and introducing new products to the market. Nobody makes money selling cell phones. Nobody will miss them now, because every store sells cell phones.
