Don't Cry for Radio Shack. My Shamelessly Self Serving Post.

I know there aren’t many listening out there but that Icon of American Retail, Radio Shack just took a well deserved, financial hit.  As a result over retail 1000 stores are scheduled for closing in These United States.  The 4th quarter saw a loss of $200 mln dineros….

Even with the scheduled demise of all those stores it will still have over 4000 retail outlets in the USA.

Pretty impressive, eh? 

Not quite.  It will only make the crash all that spectacular.

Not to gloat.  Not to sneer.  Real people will lose real jobs.  And there is nothing about that to gloss over. 

Still….as a fellow in the same “industry” as RS, I saw this coming a year ago, and am not all surprised.  How is that?  I can tell you I haven’t looked at their financials, or even taken the time to read an income statement from these guys.  Didn’t need to.

All I had to do was attempt a business transaction.   Once I attempted a business transaction with Radio Shack’s Corporate Ofc it was pretty easy to guess where the future lay for RS.  And the future here doesn’t need a crystal ball.  Radio Shack is going down.  And I say deservedly so.

Let me explain.

In my view, the quality of a company is only as good as it’s Supply Chain.  By that I mean the quality of it’s supply chain.   Why is that? 

Simple.  Their the ones responsible for identifying, grooming and managing high quality sources of supply.    In effect, their decisions effect everything else Radio Shack does, downstream.   Their decisions and level of overall competency directly effect RS’s margins.   Thus very little expense should be spared to developing and maintaining a professional Sourcing Team.   This is one place you do not want to cut costs.

However, as I found out, trying to do business with Radio Shack is akin to a camel walking through the eye of a needle.    Both the personnel and the supply chain itself lack much to be desired.  Here is my story.   It is shamelessly self -serving. (the privilege of having your own blog)

A few years back a friend of mine(it may or may not have been me) came across a Radio Shack posting for “Asian Sourcing Director”, to be based in Shenzhen.   This person was to have overall command and responsibility  for all RS sourcing needs.   In effect to manage and control the supply base.  The position in particular was to focus on wireless product.  

With a nice track record of such a product on his resume, this particular fellow decided to apply for the job.  Did I mention he lived in Shenzhen?  In sum, he was a perfect fit.  So this fellow goes off and promptly applies for the position, thinking he’s pretty much a slam dunk for at least an interview.  

Upon opening the link of the application, what does this fellow see but an invitation to take a personality and IQ Test.  

Now, not too many companies today require a personality test for a corporate position.  However, I myself have taken two of them.   Don’t know what your opinion is, but I think it’s rather insulting to be forced to take a personality test for a corporate job.  Or any test, for that matter.  You want to ensure your warehouse guy didn’t fall off the pumpkin truck on his way to the HR ofc, suit yourself.  But I’ve got an MBA and speak a badass language, Sir………so……so there! 
But there it is.  Staring this candidate in the eye. For the job he’s perfect for.  A stupid personality test.  So of course he takes it.  And the IQ Test. 

Now think abt this for a minute.  There is a position open for a Mandarin speaker to live in a foreign country that is full of pollution and this and that, and oh I think you get my point!

What normal person is going to learn Chinese?

What normal person is going to willingly live in China?

Answer:  an abnormal fellow, that’s who.   Trust me, going to China to learn Chinese 20+ years ago in the shadow of the Tiananmen Incident was nothing an “ordinary” American would do.
So how do you think ANY CANDIDATE did on this personality test?   My guess is only the well qualified candidates failed.

The funny thing is now I’m 3 for 3(whoops I mean the candidate).   Both companies I’ve been forced to sit down and take an insulting personality test for are now bankrupt.  Out of business.  No longer of this Earth.   That includes Circuit City.  Remember those guys?  The great rival of Best Buy!  I once flew cross country for an interview with these guys.   I interviewed with maybe 3 VP’s.  The  job was gonna be mine.

Than what?  At the end of my interviews I simply asked one question:

“Is there anything bad about this job?”

“Well yes”, came the earnest reply,  “you don’t get to keep your frequent flier miles”.

Now how hard would it have been for Circuit City to let the guy doing all the damn travelling to keep those miles?  Pretty easy, right?  After all, I bet the guys at Best Buy got to keep theirs!  It’s those small, selfish, arrogant things that in my view condemn a company to death.

But I digress.

After the end of my CC interview, to my great disgust, I found I had to take a personality test!  Afraid of missing my flight, I had to stop the test half way.  HR asked me to finish.  I said no.  With as much politeness as I could falsely muster, I reminded the nice HR lady my return flight wouldn’t land til midnight.   So I left.  (I didn’t get the job, and CC went under less than year after that)

I’m betting the I Q Test that Radio Shack had was probably meant for it’s hourly people.    I find I’m simply too arrogant to have to sit through one of these tests.  And anyone else with a graduate degree who says he “doesn’t mind”  is lying through his proud teeth.  

That is, I’m willing to bet True Talent thinks the same way I do.   Rather, all it does is push away those with ability and alienate themselves towards the company.   Having to take an IQ or 

Personality  Test doesn’t reflect the company in a positive light.

So what were my professional experiences with Radio Shack?

I had a product that today is very popular in the mobile accessory world today.   The factory that I build this product at currently builds a similar product for Amazon.  It’s a profitable business.  I thought I would send a couple of samples to Radio Shack.  No harm, right?  Upon scanning the RS website, I noticed they already had a similar product.  However, the reviews for this product were all terrible.   Sensing an opportunity, I tried in vain to contact RS.  No avail. 

Upon finally reaching their Taiwan ofc, I was given the contact for the China Office.   (turns out the only positive aspect of this story is how quick the Taiwan ofc responded)

Obviously oblivious to the poor reviews of their own product, I was repeatedly blown off.  This is when the first warning flag went up.   As a potential supplier of the Radio Shack Supply Chain, my job is basically a sales job.  Upon letting them know which customers my factory builds for, and who we supply glass to, you would’ve thought I’d at least get a response. 

How’s that?  Simple…a true sourcing guy will at least be curious to see where an Amazon builds it’s glass.  Even if he absolutely has no intention of buying, he stills wants the “intelligence”. 

Not this gang. 

You see, I have a whole different insight from what the man on the street has.   I get to see the “real” RS at work.  In essence I get to see The Big Swinging Dicks at Radio Shack, and I get to see what they think of themselves.  

But I get it. 

One has to realize these people are offered free meals and god knows what else everyday, if only Radio Shack would buy their product.   After all, their product is special.   How does one not walk around with a Big Swinging Dick?

Still, knowing how to push the buttons of the Chinese(takes time to develop this skill),  I finally got hold of the USA ofc.   They in turn contacted China, and WOULDN’T YOU KNOW I GOT A RESPONSE!  The very next day!  They tell me to send them samples.   Now, I fully understand that the powers to be in Radio Shack’s local Shenzhen ofc are oh so busy getting paid off(whoops, I meant getting stroked) by every China supplier out there, and don’t have time for me.   Another reason perhaps why it’s so awkward to work with a persistent laowai who “doesn’t understand the way it’s done”. 

Well, the Shenzhen ofc sits on it, and after a few weeks, I go back hat in hand to the USA ofc and the fellow with RS says to me:

“Just send me the samples, Fletcher”.

Music to my ears!

Than another warning flag goes up:

When I ask him what specs he’d like me to ship the product to, his answer his coy:  “By the way, the specs of our own product are proprietary, but could you tell me about yours?”

Right away I know I’m working with a guy in the US Sourcing Ofc who is totally blind as to the specs of his own product, and is trying to leverage my knowledge for his own benefit.   We all hate it when a customer tries to “jerk our chain”, but I was rather aghast to hear this guy couldn’t even tell me what his own specs are….! 

This in turn made me doubt the China Sourcing Ofc for Radio Shack itself even knew what it was buying.   This in turn made me doubt the ability of the RS Quality Team.  Sure, the supplier probably made good samples.  But when push came to Mass Production….well their ofc is just trying to fill holes in it’s own product line, and having the best product, or staying abreast of new technologies just isn’t a priority.

As such, Radio Shack can only become a bottom feeder.  A company with no strong product direction eventually only buys “on the cheap” because that’s always the instinctive reaction to a decrease in margins.   It’s a vicious cycle.  The lower the margins, the cheaper the product Radio Shack in turn sources.    It may as well be called “Bottom Shack”.  Or “Cheap Shack”.

Then there was the 3rd and final Warning Flag.

Radio Shack’s home ofc in Dallas never tested the samples.   After a week went by I finally called them up.  Their response is priceless:

“Send the samples to our Shenzhen ofc”

Yep…you heard right.  After sending Radio Shack samples 8000 miles, for what I thought would be professional bonafide testing, I was basically told the following:

“We can’t be bothered with your product.  Even though you sent it 8000 miles to us at our request for testing, we didn’t do it.  So go ahead and resend it the 20 miles from your factory to our local ofc in Shenzhen.  It probably won’t get tested there either.  Yes, we know who your customers are….but quite frankly we just can’t be bothered.”

So I did.  And you know what…..Shenzhen didn’t test them either. And still hasn't.  Indeed, the samples are probably being "used" on someone's personal phone now.

I guess you could say they weren’t “properly motivated”.

So let’s not cry for Radio Shack.   American Capitalism isn’t always fair, these days.   Too much is going to the top, and too little is trickling down.   Still, our system tends to very brutally and efficiently separate the capable from the incapable.   Yes, there’s always a hell of a lot of collateral damage.  But this time our Free Economy got it right.  



    Reminded me of this post.

  2. Good timing Joe! Maybe I should post this on wait, I've sworn myself to never "posting a post" on there again.


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