RadioShack Plus Best Buy: Geek Squad Storefronts?RadioShack Plus Best Buy: Geek Squad Storefronts?
What if Best Buy acquired RadioShack, then uses the small retail storefronts to promote Geek Squad and mindSHIFT technology services to SMBs that desire PC, BYOD tablet and smartphone support?
July 24, 2013
Here’s a crazy idea: What if Best Buy (BBY) acquired RadioShack (RSH), and transformed all of those struggling RadioShack locations into Geek Squad storefronts — optimized to offer PC, BYOD, tablet and smartphone support to consumers and small businesses? It sounds like a crazy, far fetched concept. But is it? Consider these variables before you answer.
RadioShack has hired AlixPartners (a global business advisory firm with expertise in corporate turnarounds), and Peter J. Solomon Company (an investment banking firm) to help bolster the business — which is struggling badly. The company yesterday announced a $53 million quarterly loss, and CFO Dorvin Lively exited to join Planet Fitness. A major dept payment is due next week, according to The Wall Street Journal, but the company says it has enough cash to survive the holiday season and beyond.
My opinion: Any time a company talks about cash preservation, it’s a loud alarm for investors, partners and customers.
Meanwhile, In Big Box Retailer Land
Now let’s look at Best Buy’s Business. The company will announce Q2 2014 earnings on Aug. 20, 2013. The last earnings report, from May 2013, contained better-than-expected results. A “Renew Blue” push involved a range of moves — including Samsung Experience Shops opening in Best Buy’s retail stores.
Missing from Best Buy’s earnings report: Any type of statement about Geek Squad and mindSHIFT — the company’s consumer- and business-focused IT support teams.
Best Buy acquired mindSHIFT — an MSPmentor 501 company — in November 2011. Since that time, our research indicates mindSHIFT has continued to grow. Plus, the company is now a Top 100 Cloud Services Provider, according to Talkin’ Cloud research that will debut July 30, 2013.
Now imagine Best Buy, mindSHIFT, Geek Squad and RadioShack all under one roof. The potential scenarios:
RadioShack armed with Geek Squad employees who understand all endpoints — PCs, notebooks, tablets, smartphones.
Consumers finally gain a “small store” alternative to Apple Genius Bars.
Small and midsize businesses gain control of BYOD — telling employees to source their personal devices from Radio Shack.
mindSHIFT, in turn, ultimately manages the end points for the small business customers.
Those customers outsource more and more IT services to mindSHIFT.
Perhaps the best part of all: RadioShack’s market cap is only $264 million — though I don’t know how much RadioShack debt a potential suitor would need to repay as well.
Back to Reality
I concede: I doubt Best Buy and RadioShack will ever get hitched. And I concede: Such a business combination is likely a terrible idea, since online retailers like Amazon continue to squeeze RadioShack and Best Buy every month.
Plus, Best Buy itself has spent the past year overcoming its own management, financial and ownership questions.
Still, I wonder: What will Best Buy ultimately do to more fully leverage Geek Squad and mindSHIFT?
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