Radio Shack’s 2015 bankruptcy

Last Updated on April 4, 2026 by Dave Farquhar

On February 5, 2015, Radio Shack filed for chapter 11 bankruptcy after posting losses 11 quarters in a row and accumulating $1.4 billion in debt. While not officially the end of Radio Shack, the Radio Shack that still exists today is a shadow of its pre-2015 self. At one time, Radio Shack was a retail giant, with about as many stores as McDonald’s, with a high percentage of them in small towns. A small town was about as likely to have a Radio Shack as a McDonald’s, and might not have both.

We saw it coming

There wasn’t much surprise when Radio Shack filed chapter 11 bankruptcy in February 2015. Radio Shack had been declining since the 1990s. At its peak, Radio Shack had about 6,500 stores. By 2014, it was 2/3 that size, at closer to 4,300, but it was still too many stores for its business model at that time.

Too many stores too close to each other

Particularly in metropolitan areas, Radio Shack had too many stores too close to each other. Where I live, there were two Radio Shack locations about two and a half miles from each other in 2014. One was in a suburban strip mall in between a Sears Hardware store and a long defunct dollar store. The other was in a closed-air shopping mall near the entrance, between a USPS retail store and a Sears.

In the 1980s and 1990s, both stores had enough traffic to justify their continued existence. The strip mall location moved at one point in the 1990s as the population around it shifted. Its previous location had been even closer to the mall.

But as the 21st century entered its second decade, there were fewer and fewer reasons to go to Radio Shack. Having two stores within a five-minute drive of each other no longer made sense when each store only had 1-2 customers at any given time. It basically doubled the corporate parent company’s overhead to serve the area, since they had to pay rent two places, keep enough inventory to fill two stores, and keep 1-2 employees in each store at all times.

As time wore on, both stores suffered as corporate struggled to keep inventory stocked. I remember going to one store, only to find out they didn’t have what I needed in stock, so I had to drive to the other one to get it. It was always anyone’s guess which store was more likely to have what I needed. This was before the days when you could just visit a web site and check inventory online to see which location had what you needed in stock.

Employee stories of this time painted a sad picture.

Radio Shack couldn’t close its underperforming stores

The problem was Radio Shack had too many stores, but they couldn’t close them. Rumor was they didn’t have the money to close the stores, but there was another problem. A $250 million loan Radio Shack took from Salus Capital in 2013 limited Radio Shack to closing 200 stores a year without Salus’ approval. In 2014, Radio Shack asked to close 1,000 stores, but Salus denied the request. Why Salus didn’t protect its interests by letting Radio Shack’s management do what it needed to do to remain solvent and pay the loan, I’m not sure.

Meanwhile, Radio Shack couldn’t shore up its online presence to better compete with Amazon and Ebay. While other retail stores had started making it possible to check inventory online and order online for in-store pickup to be more convenient, Radio Shack didn’t have the money to modernize.

Closing underperforming stores had been a Radio Shack tradition under Charles Tandy. Part of his turnaround plan after he bought Radio Shack for a mere $300,000 was to only sign short-term leases so he could easily close or move stores.

The dilemma of what to sell

Radio Shack had been selling cellular phones since the 1980s. Smartphones increasingly could replace the majority of what Radio Shack stores sold for decades. So it made sense for Radio Shack to shift and sell more phones and fewer other consumer electronics. The problem was, as phones became an increasing percentage of what Radio Shack sold, competition heightened and profit margins shrunk. Carriers started subsidizing phones and opening their own stores to cut out the middleman. Besides Radio Shack, guess who else operated a retail store in the closed-air mall near me and a second location in a strip mall near me? Every major phone carrier, that’s who. Well, not every major phone carrier operated two stores near me. Some operated three.

And the reduced foot traffic made it hard to sell electronic toys like the Armatron and the siren-equipped fire chief’s helmet to make up the difference.

In theory, Radio Shack could have shifted again, turning itself into a miniature Best Buy, selling TVs, set top boxes like Rokus, audio gadgets, and game consoles, along with all the cables and adapters you’d need. They could have offered a limited selection of largely private label electronics and competed on price, taking advantage of having much lower overhead because its stores were 1/10 the size. But they didn’t have the money to do it. The $43 million in cash on hand at the time of bankruptcy wasn’t enough capital to make that change.

Bankruptcy wasn’t quite the end of the line for Radio Shack

In May 2015, General Wireless, a subsidiary of Standard General, purchased the Radio Shack brand name and related intellectual property for $26.2 million and partnered with Sprint to operate the stores. The very last time I visited Radio Shack in person was in January 2017, when it was under General Wireless ownership. Most of the other traffic while I was in the store was related to a Pokemon Go promotion they were running. One of the employees told me they expected the store would close soon.

Sprint was struggling too, and the two companies didn’t save each other. By March 2017, General Wireless filed for bankruptcy and started closing stores, shifting most of its business online.

Modern-day Radio Shack

Retail Ecommerce Ventures, a holding company owned by Alex Mehr and self-help influencer Tai Lopez, acquired Radio Shack in November 2020. In May 2023, Unicomer Group acquired control of the worldwide Radio Shack franchise. Unicomer is based in El Salvador and is one of the largest franchisors of Radio Shack, with stores in Central America, South America, and the Caribbean.

The 2015 and 2017 bankruptcies resulted in the majority of Radio Shack retail stores in the United States closing. Most of what’s left are franchises. Not long ago, I was picking up lunch, wearing my Radio Shack t-shirt sporting the iconic 1970s logo. The cashier gave me a puzzled look and asked me where the closest Radio Shack is. I had to admit I didn’t know, I just liked the shirt. I looked it up when I got home because I was curious and it seemed like something I should know. Turns out it’s 60 miles away, in Nashville, Illinois.

But they have a much improved online presence now. If you want a snazzy Radio Shack mousepad for your retro computer and a Radio Shack USB flash drive for your Gotek in your retro computer, they’ve got you covered. I use one of each with my Tandy 1000 EX, along with a Radio Shack-branded serial mouse from around the turn of the century. It just seems right.

Dave Farquhar

David Farquhar is a computer security professional, entrepreneur, and author. He has written professionally about computers since 1991, so he was writing about retro computers when they were still new. He has been working in IT professionally since 1994 and has specialized in vulnerability management since 2013. He holds Security+ and CISSP certifications. Today he blogs five times a week, mostly about retro computers and retro gaming covering the time period from 1975 to 2000.