Radio Shack wants to return to Baker

By ED MERRIMAN Baker City Herald May 19, 2010 12:12 pm

Radio Shack is searching for an entrepreneur to open a franchise store in Baker City this summer.

“The population of Baker City is one of the largest in Oregon where we don’t have a Radio Shack store,” said Bill Bartels, area developer for new Radio Shack stores.

Baker City had a Radio Shack outlet in the Pocahontas Road building that also housed Lumbermens, but that store closed in 2009 when Miller’s Home Center bought Lumbermens.

Bartels traveled from his corporate office in Waterford, Wis., last week to visit Baker City and meet with members of the Baker County Chamber of Commerce, local bankers and the media to spread the word and gauge public support for opening a new Radio Shack store in town.

“We talked to some chamber folks, and to some bankers in town, and they are very encouraged about Radio Shack wanting to open a store in Baker City,” Bartels said. “We’d like to get something going this summer.”

“The population size is very good, the distance from other stores (Pendleton and Boise) is good, the economy is stable, and there are several locations with potential downtown and in other areas around town,” Bartels said. “We are looking for someone with personality who is interested in electronics.”

Kurt Miller, an owner of the Baker Truck Corral on East Campbell Street, said he talked with Bartels about adding a Radio Shack store under a program where existing businesses can add what Bartels calls a “store within a store.”

Miller said he’s not sure the franchise would pencil out, partly because he’d need to add on to his building in addition to the initial franchise fees, equipment costs specific to Radio Shack and other factors.

Bartels said the initial cost of becoming a Radio Shack franchisee varies, depending on the square footage of the store and the amount of merchandise, fixtures and equipment purchased from Radio Shack.

“It’s really a turn-key business. We provide the merchandising, the fixtures and equipment, computerized cash registers, marketing and advertising, point of sales materials, and training about the products and how to run the business,” Bartels said.

Bartels said franchisees make money not only on product sales, but on commissions for cell phone and satellite radio and television service contracts.

Radio Shack stores sell a wide variety of electronic equipment, including computers, TVs, iPods, computer games, stereos, digital cameras, and a myriad of accessories.

With Radio Shack approval, franchisees are also free to add other products that aren’t supplied to Radio Shack, such as groceries, household gifts and cards, hardware, guitars and amplifiers and other merchandise.

Bartels said those kinds of merchandising agreements are negotiated with potential franchisees prior to formal agreement, or as a later amendment to a franchise contract.

“It’s pretty flexible,” he said.

As with any business, one of the keys to success is a location with good traffic flow, visibility and adequate parking, Bartels said.

Lack of parking is a fairly common problem in older downtowns built without parking lots, and that is a factor Radio Shack, which has about 6,000 stores, considers in assessing the viability of a downtown location.

“In a shopping center parking is not problem, but in downtowns we like to have a corner lot, or a location near a parking lot,” Bartels said. “If we don’t have good visibility and good parking, we can’t have a location there.”

The availability of parking in downtown Baker City has long been an topic of discussion among downtown business owners and city officials.

“We have a number of stores that are downtown in other communities. We look at each town individually,” Bartels said.

With more than a dozen vacant buildings on Main Street, City Manager Steve Bogart said the City Council has identified downtown parking as a priority issue.

“One of the things the Council has identified as a priority to accomplish this year is a parking plan,” Bogart said.

Jennifer Watkins, Baker City assistant manager and community development director, said the city has received many volunteer assessments about the downtown parking situation, but the city needs to hire an engineering firm to make a professional assessment of the size and types of buildings and businesses located downtown, and how many parking spaces are needed to adequately serve those needs.

In scoping out possible Radio Shack locations around Baker City, Bartels said he heard about the pending closure of the Movie Gallery store in the Baker Towne Square mall.

He said that would be an ideal location with plenty of parking and traffic flow, with Albertsons, Verizon Wireless, Maurice’s and Bi-Mart all drawing potential customers to the mall. 

When Wayne Ryder and other owners of Millers Home Center bought Lumbermens in 2008, they decided to discontinue the Radio Shack franchise that had been there for more than a decade.

“We are a lumber yard and home improvement store. It just didn’t fit in with our program,” Ryder said. “After two years we still get people in here looking for Radio Shack every day, but we are not interested. We are just not an electronics store.”

Bartels said he believes Baker City can support a Radio Shack store, and that one would thrive in a good location.

“There’s not much in the way of electronics in Baker City, and several people in town have asked us to come back and open a new Radio Shack store,” Bartels said. “We research towns all over America, and we think Baker City is a prime location.”

While businesses in general have struggled nationwide during the recession, Bartels said Radio Shack sales remained strong across the country. Both sales and profits increased in the last quarter of 2009 and the first quarter of 2010.

 He said Radio Shack has company-owned corporate stores in some larger cities, and those types of stores are run by a local manager.

But most Radio Shacks are franchise stores owned by local entrepreneurs.

“The whole process from talking to a person opening a store takes about 60 days,” Bartels said.

For more information call Bartels at 262-662-0755.