TechAmerica still a test; Tandy crosses fingers

Discount Store News, Jan 4, 1999

Tandy isn't totally free of outside retail concepts TechAmerica, a store that president and ceo Len Roberts describes as "RadioShack on steroids," opened its third unit in Phoenix four months ago and continues to be considered a test concept

The three locations vary in size Phoenix is 14,000 sq. ft., Denver is 18,000 sq. ft. and Atlanta comes in at 25,000 sq. ft. But the product mix clearly targets the electronic hobbyist and DIYer. It also features a whopping 656-page catalog, and its full breadth of product is available on line at the TechAmerica Web Site.

In truth, TechAmerica looks a lot like a RadioShack catalog of 40 years ago. Acknowledged Roberts. "It is so highly specialized that the real opportunity may be in the catalog business." (RadioShack began as a Boston-based mail order company in 1921 and catered to ham radio operators and electronics buffs, issuing its first catalog in 1940.)

As a retail concept, TechAmerica's future is unsure, Roberts said. There simply may not be a very large customer base of hard core hobbyists. Rather, Tandy sees the potential for possibly five to 10 retail locations, backed by strong catalog sales.

But TechAmerica is a high-margin business for Tandy, which is a significant point of differentiation from Tandy's other failed business ventures. McDuffs, The Incredible Universe and Computer City all represent instances where Tandy wandered from its core strengths and got hurt. "We had no core competency in operating a low-margin, branded concept in a superstore format," Roberts said. "It's not part of the culture, it's not part of the expertise, not part of our system."

For his part, John Roach, the now former ceo of Tandy, chalked up some of the failures to poor timing. Tandy entered the CE superstore business in the 1990s, just as the market went soft and more established chains were struggling or going under.

McDuffs closed in 1996, and The Incredible Universe went under a year later Computer City hung on a bit longer but was finally sold at a loss to CompUSA in August 1998, for $275 million.

Roach told DSN that The Incredible Universe has been the biggest disappointment of his career, more than 30 years of which was spent at Tandy. "We tried hard at Incredible Universe, we tried hard," he said. "Nobody bats a 1.000."

But in spite of unsuccessful retail ventures, Roach leaves behind RadioShack, a profitable company with a strong core business. During his tenure, RadioShack grew from 109 stores the more than 7,000 units it operates today.

"The biggest single surprise I've had with Tandy and RadioShack is that in the formative years not a single emulator showed up. Nobody tried to copy our format, and here was something that was clearly profitable," Roach said. "It is most amazing that RadioShack has such a unique position in the marketplace and has remained viable."