It was once incredibly valuable for RadioShack to have a dense network of small stores in communities across the country. Now that the company is in financial trouble and struggling to find a business model and an identity, having more than 5,000 stores is a huge burden. The company can’t afford to keep all of the stores open, but it can’t afford to close them, either.

RadioShack first announced that it would close 500 stores, then 1,100, then a lot fewer. Keeping underperforming stores open is expensive, but closing down stores is expensive too: other stores within a few miles might be able to take on merchandise instead of liquidating it at deep discounts, but the company would still have to negotiate an end to its leases and pay severance.

Radio Shack is also being sued by current and former employees over the company’s options for employee retirement plans. A former store manager was the first to file a federal lawsuit accusing the company of breaching its fiduciary duty to employees by making RadioShack stock available as an option in their 401(k) retirement plans.

Time is running out for RadioShack [CNN] (Warning: auto-play video)
Lawsuits allege RadioShack acted imprudently on 401(k) plans [Fort Worth Star-Telegram]

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