Dive Brief:

• Due to RadioShack’s recent struggles, many of its once-booming dealer stores have also stumbled, and some are closing down. 

• Many stores have been a bright spot for the company, but learned last week that they’ll need to pay cash up front for any new inventory. Some 100 dealers have organized to advocate for themselves in the bankruptcy proceedings and have hired a lawyer.

• Meanwhile, the retailer said it would stop accepting gift cards this week on March 6. There are some $44 million worth of RadioShack gift cards in circulation. 

Dive Insight:

In areas where a full-on RadioShack store wouldn’t have ever survived even in good times, several independent dealers sold the retailer’s inventory through their own hardware stores, general stores, appliance stores, and others — and did quite well for themselves and the company. They have been sort of the lost lambs of the retailer’s recent struggles, which has been focused first on attempts to close stores and now, in bankruptcy, on auctioning off stores and store leases.

Last week, many of those small businesses learned that they have limited options as the bankruptcy proceedings continue. 

“It’s going to be very awkward for the dealers if RadioShack is not going to be standing behind them,” Richard Mikels said in court during the proceedings last week, and said later: “They’re profitable and they’re survivors.”