1 / 2

Radio Shack

Radio Shack. $4.2B public electronics retailer Operates approx 6,000 stores (4,500 company owned/1,500 franchised) and 1,500 kiosks across the US Currently liquidates all returns through Free Flow web site Data wipes all returns except those sent back to vendor

regan-kline
Download Presentation

Radio Shack

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Radio Shack • $4.2B public electronics retailer • Operates approx 6,000 stores (4,500 company owned/1,500 franchised) and 1,500 kiosks across the US • Currently liquidates all returns through Free Flow web site • Data wipes all returns except those sent back to vendor • Wants to improve recovery values – believes current process does not bring the most value • Asset Recovery Services (Canada) • GENCO to liquidate all returned product – currently $350MM per year of which 10% is salvage • Product categories include all electronics with heavy emphasis on cell phones • Current recovery (against cost) approximates 21% before expenses (per RS) • Revenue projection below is based on data provided by Radio Shack • Revenue (Steady state projected) • $8.05MM (assumes $25MM net returns (ex accessories) bought at approx 28% and resold with 15% markup) • Margin Mark Up Percent • $1.05MM Net Margin: 15%

  2. Assumptions Competitor Information • Issued open bid September 2010. No vendor awarded the deal. • Still only selling via web based auction site – B2B exclusive • Taking to GENCO ATC only at this time. • GENCO can offer blended rate approximating 28% (excluding accessories) • RS responsible for testing, data wiping and sorting by category • GENCO has appropriate facility to store goods • Merchandise Sellable at 15% markup HomeGoods Solution • GMP purchases all liquidation product at agreed to % of cost (based on category) • Product delivered to GENCO site tested, sorted by type and data wiped • Sorted at GENCO facilities, palletized and sold OR sold “as is” • GENCO will use existing facility in Nashville or other location (ATC if possible) Win Strategy/ Game Changers • Commitment to purchase all product categories (ex accessories) • Favorable pricing that increases overall recovery for RS • Willing to pay cash as product received (not dependant on resale) • Understanding of RS business model and needs • Good software, item tracking and customer visibility into recovery • Outstanding customer support and service GAPS • Pricing model that increases overall recovery • Ability to handle additional electronics products at this time Competitive Position • Key Points: • Submitted unsuccessful bid September 2010 (phones bid at 15%) • Radio Shack maintained status quo using Freeflow • Uses R-Log for data processing and inventory information • Does not believe current “freeflow auction” process gets the most recovery available • Data wiping critical for all return product before salvage

More Related