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F.T. Consulting Firm
RadioShack Corporation Analysis
Agenda
    Who is F.T. Consulting        2nd Strategic Orientation
                             

    Firm              ...
F.T. Consulting Firm
     Established in 2008
 


           your future transitions
 “Making
 possible…”
     Assisted ...
Industry SWOT Analysis
    Strengths                       Opportunities
                               
        Ability...
Industry Benchmarks
                                                                                               Benchma...
Survey Results
         Potential Buyers                              Consumer Wants


  13%                              ...
Strategy 1
                    RadioShack




    Consistency       Contract          Customer


  Store layout      Pro...
Strategy 1 Marketing Plan
    Message: Identity of RadioShack


        High-quality products
    

        Superior cus...
Advertising Budget
New Store Layout
Market Segments
    Younger Generation            Baby Boomers
                             
    (Pre-teens and teens)  ...
Customer Experience
    What type of experience does RadioShack


    want to give its customers?
        Simplicity
    ...
RadioShack.com




    Before       After
Strategy 2
                 RadioShack


        Maintain           Maximize

      Keep product mix   Increase store fo...
Strategy #1 vs. Strategy #2
    Strategy 1

                                            Strategy 2
                      ...
Recommendations
        Strategy 1 Recommended

          Industry analysis supports strategy
    

          Feasible
 ...
NPV
                                                   NPV
                                             (In Millions, USD)...
Summary
    F.T. Consulting Firm best choice


    Industry remains promising


     The answer to Who is RadioShack?

...
Q&A




      Alisha Thomas, Sr. Consultant
      Lareal Hudson, Sr. Consultant
      Trevor Hussey, Sr. Consultant
      ...
Organization

                                                           Julian C. Day
                                   ...
Product Liquidation


           Sell back
                        Sell to
Heavily    for New
                       small...
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Radio Shack2

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Radio Shack2

  1. 1. F.T. Consulting Firm RadioShack Corporation Analysis
  2. 2. Agenda Who is F.T. Consulting 2nd Strategic Orientation   Firm Comparison  Industry SWOT Recommendation   Analysis Summary  Industry Benchmarks  Q&A  RadioShack  1st Strategic  Orientation Marketing Plan  Market Segments  New Store Layout  Costumer Experience 
  3. 3. F.T. Consulting Firm Established in 2008  your future transitions “Making possible…” Assisted following companies:  Caron Furniture  F.T. A.H. Belo Corporation  Future Transitions Consulting Firm Business Analysis & Consulting
  4. 4. Industry SWOT Analysis Strengths Opportunities   Ability to keep being  Hispanic population  innovative (Spanish speaking) Growth potential  Digital TVs &gaming  Investors  Need for innovation  Increased efficiency  Threats  Weaknesses  Globalization  Innovation  Competition  Recession 
  5. 5. Industry Benchmarks Benchmarks FirmPerformance Measures (computed from Theoretical Construct and Dimensions External Chosen? Internal data in case) (Industry (Goals) Norms) Financial Current Ratio 2.8 1.82 2.5 Position Financial Performance Operating 4.9% profit 3.8% (Yahoo 4.9% (thestreet.com Performance Profitability Profit Margin margin Finance) ) 10% in 5 Market Performance Market Share 6.96% 100% yrs Organizational Health Employee Growth -3.85% .98% .5%
  6. 6. Survey Results Potential Buyers Consumer Wants 13% 13% 13% Atmosphere Would buy from Knowledgable Staff 17% RadioShack Will not buy from 57% Convenience RadioShack Quality Products 87% Slogan Recall Competitors 3% 18% 18% 17% Recall Slogan Fry Best Buy Don't know 83% Wal-Mart 61% slogan RadioShack
  7. 7. Strategy 1 RadioShack Consistency Contract Customer  Store layout  Product mix  Service  Slogan  Company size  Product demands  Training  Product Demos  Marketing Plan  Spanish Website
  8. 8. Strategy 1 Marketing Plan Message: Identity of RadioShack  High-quality products  Superior customer service  Convenient locations  RadioShack. Connecting consumers with technology.  Ad #1: Transition of RadioShack  Ad #2: Going Green  Customer Experience 
  9. 9. Advertising Budget
  10. 10. New Store Layout
  11. 11. Market Segments Younger Generation Baby Boomers   (Pre-teens and teens) (50’s and above) Customer Service Interesting website   Convenience  Going Green  Demos  Newest products  Store layout  Middle Generation  (20’s-40’s) Focus on value  Convenience  Demos 
  12. 12. Customer Experience What type of experience does RadioShack  want to give its customers? Simplicity  Superior customer service  “Try before you buy”  Inviting atmosphere  Information 
  13. 13. RadioShack.com Before After
  14. 14. Strategy 2 RadioShack Maintain Maximize Keep product mix Increase store format  Improve Kiosks  Increase services  More employee training
  15. 15. Strategy #1 vs. Strategy #2 Strategy 1  Strategy 2   Pros:  Pros: Transitions RadioShack  Familiarity  Capitalizes on Industry  Managerial and employee  forecasts training improved Positions RadioShack in  More services offered mind of consumers   Cons: Reduce affects of recession  on business Not feasible   Cons: Large financial risks  Employees need training Competition   Financial risks Ignores industry analysis   Calls for expansion  Minimal transitions 
  16. 16. Recommendations Strategy 1 Recommended  Industry analysis supports strategy  Feasible  Easy to implement  Likelihood of success  Action Plan 
  17. 17. NPV NPV (In Millions, USD) 2009 2010 2011 2012 2013 Initial Investment Cash Flow -305.1 170.68 175.36 180.17 185.09 190.13 (1.1285) (1.1285)^2 (1.1285)^3 (1.1285)^4 (1.1285)^5 $289.95 NPV = (in millions) Risk free rate (rf) 0.14% Total Debt $ 590.60 Beta (β) 1.64 Total Equity $ 1,760.00 Expected market return (rm) 11% Total Firm Value $ 2,350.60 Discount rate (k) 12.85% Share Price $ 11.94 Cost of Equity 17.95% Volume 1,987,300 Cost of Debt 5.06% WACC 12.85% 20.12% ROI Corporate Tax Rate 35.75%  Positive NPV supports proposed strategy # 1
  18. 18. Summary F.T. Consulting Firm best choice  Industry remains promising  The answer to Who is RadioShack?  Strategic Orientations  Recommendation  Call to action 
  19. 19. Q&A Alisha Thomas, Sr. Consultant Lareal Hudson, Sr. Consultant Trevor Hussey, Sr. Consultant Jennifer Carey, Sr. Consultant Kenneth Connally, Sr. Consultant Whitney Fitzgerald, Sr. Consultant Jamal Abdul-Rahman, Sr. Consultant
  20. 20. Organization Julian C. Day Chairman and CEO Peter J. Whisett Bryan Bevin Martin O. Moad John G. Ripperton Lee Applbaum James Gooch Chief Merchandising Executive Vice Chief Marketing Chief Financial Vice President and Senior Vice President Officer President of Store Officer Controller of Supply Chain Officer Operations We recommend making no changes to the organizational structure. 
  21. 21. Product Liquidation Sell back Sell to Heavily for New smaller Recycle product Discount stores credit

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