Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
Support MFO
Donate through PayPal
Radio Shack gets Financing for the Christmas Season.
Didn't we hear this same story about Sears? Money is needed to buy product for Christmas shopping season. Radio Shack has been on the edge of the abyss for so long that it's hard to remember the last year they had profits.
Throwing money at the problem doesn't fix the situation here. Radio Shack, through the passage of time, just has become no longer relevant. Maybe there should have been a name change at some point, who knows. If you need little electronic accessories, you order via Amazon. If you need a phone, you go to your carrier (or order it.)
Radio Shack stores would be a decent pick-up/showroom for Amazon. They are also about the size of UPS stores. Either way, sadly I think they'll be something else sooner than later. If Best Buy is struggling to figure ways to stay relevant even after Circuit City is gone, what's Radio Shack supposed to do?
I question whether or not there would be any sort of financing for Radio Shack if we were not in the easy monetary environment we're still in.
Lastly, I can't think of many retailers who are really doing well. Costco is. Target and Wal-Mart are having their various problems. Amazon is doing well, although their bottom line remains lackluster as a result of their continued attempts at expansion. Home Depot is doing reasonably well. Other than that, nothing comes to mind as really standing out.
Also, as for irrelevant, I'll still say I think Gamestop is in trouble when games go digital and will gradually become more and more irrelevant until that tipping point.
What has changed at RSH that will make this loan any different?
Maybe they are just buying time.
Until they can figure a way out.
Break, break.
Think Bed Bath & Beyond is doing well.
How about FrontGate?
BBB is doing well, but there has been a lot of discussion of how much they've been using buybacks (Bed, Bath and Buyback?)
Not heard of Frontgate, maybe it's a more local/regional. From just a brief look, maybe it's comparable to Restoration Hardware (which seems to continue to do well, as does Williams Sonoma.)
I do think that specialty retailers like Wayfair and One King's Lane appear to be doing well (the former just IPO'd yesterday), but both of those are online. Alibaba's 11 and Main seems to be in direct competition to these companies.
As for Gamestop, buying my new XBOX One probably either via Amazon (no sales tax) or Costco (which has it cheaper than anyone else.)
The successful retail stores are usually the ones that offer something unique or not available anywhere else. Quality and good service are key. There are too many "me too" stores that carry the same thing. Go into a mall and you see a bunch of so called specialty clothing stores that look like they have the same product. Of course, Costco, Amazon and other online stores beat the prices of the bricks and mortars.
Some stores are fads. Forever21 comes to mind. It was all the talk with the girls a couple of years ago. I don't hear them talking about it anymore. Ambercrombie and Old Navy are a couple others.
Radio Shack was good when you couldn't find a particular electronic item or hardware. The last time I went in their inventory was pretty small. It looked like they got rid of the slow movers which were the items that brought people in.
I do not like to invest in retail. Tastes change. Technology changes. Simon Property Group had a really interesting slide in one of their presentations not that long ago where it showed the top 10 retailers in the 90's vs today. Only 2-3 from the 90's were still around. Yet, Simon Property is still doing well. Retail changes, retail space remains retail space. There's the whole discussion of online versus retail and online winning, but I guess what I'm saying is rather than investing in retail, retail real estate is possibly a more consistent and lasting bet, plus yield as a bonus.
My view: either invest in a commercial property REIT to have exposure to retail or invest in credit card companies as more people move away from cash and checks. I like the latter a lot and have done a little in regards to the former.
Comments
Radio Shack stores would be a decent pick-up/showroom for Amazon. They are also about the size of UPS stores. Either way, sadly I think they'll be something else sooner than later. If Best Buy is struggling to figure ways to stay relevant even after Circuit City is gone, what's Radio Shack supposed to do?
I question whether or not there would be any sort of financing for Radio Shack if we were not in the easy monetary environment we're still in.
Lastly, I can't think of many retailers who are really doing well. Costco is. Target and Wal-Mart are having their various problems. Amazon is doing well, although their bottom line remains lackluster as a result of their continued attempts at expansion. Home Depot is doing reasonably well. Other than that, nothing comes to mind as really standing out.
Also, as for irrelevant, I'll still say I think Gamestop is in trouble when games go digital and will gradually become more and more irrelevant until that tipping point.
What has changed at RSH that will make this loan any different?
Maybe they are just buying time.
Until they can figure a way out.
Break, break.
Think Bed Bath & Beyond is doing well.
How about FrontGate?
Check out the person running the fund, Soo Kim. Interesting.
PS I guess I was typing something the server didn't like?
Not heard of Frontgate, maybe it's a more local/regional. From just a brief look, maybe it's comparable to Restoration Hardware (which seems to continue to do well, as does Williams Sonoma.)
I do think that specialty retailers like Wayfair and One King's Lane appear to be doing well (the former just IPO'd yesterday), but both of those are online. Alibaba's 11 and Main seems to be in direct competition to these companies.
As for Gamestop, buying my new XBOX One probably either via Amazon (no sales tax) or Costco (which has it cheaper than anyone else.)
Some stores are fads. Forever21 comes to mind. It was all the talk with the girls a couple of years ago. I don't hear them talking about it anymore. Ambercrombie and Old Navy are a couple others.
Radio Shack was good when you couldn't find a particular electronic item or hardware. The last time I went in their inventory was pretty small. It looked like they got rid of the slow movers which were the items that brought people in.
I do not like to invest in retail. Tastes change. Technology changes. Simon Property Group had a really interesting slide in one of their presentations not that long ago where it showed the top 10 retailers in the 90's vs today. Only 2-3 from the 90's were still around. Yet, Simon Property is still doing well. Retail changes, retail space remains retail space. There's the whole discussion of online versus retail and online winning, but I guess what I'm saying is rather than investing in retail, retail real estate is possibly a more consistent and lasting bet, plus yield as a bonus.
My view: either invest in a commercial property REIT to have exposure to retail or invest in credit card companies as more people move away from cash and checks. I like the latter a lot and have done a little in regards to the former.