Sprint (NYSE: S) said it is now selling its service at 4,500 retail locations across the country thanks in large part to its partnership with RadioShack. The carrier also announced a partnership with European mobile retailer Dixons Carphone to launch a pilot program of around 20 stores in the U.S.
Sprint will have a presence in 1,435 Sprint/RadioShack stores by the first week of July, the company said. The Sprint/RadioShack stores started offering devices and services from Sprint and Sprint's Boost Mobile and Virgin Mobile brands in April following RadioShack's exit from bankruptcy and a deal between Sprint and General Wireless, an affiliate owned by hedge fund Standard General.
Around 300 Sprint/RadioShack stores will be completely renovated to the new store-within-a-store model, with the remainder scheduled to be completed by the end of the year. These stores will have new signage, new fixtures and a look similar to other Sprint-owned stores.
Sprint will command around a third of the space in the RadioShack locations, and will use its own retail employees to sell phones and service. Sprint will pick up the tab for the overhead cost, and will distribute commissions on its merchandise and help with advertising. Additionally, at most of those stores, Sprint's logo will be more prominent than the RadioShack logo.
In addition to the Sprint/RadioShack stores, the company has around 1,100 company-owned retail stores and has close to 2,000 dealer locations. Sprint spokeswoman Barbara Mellott noted that these stores are dealer-owned, but Sprint-branded, selling only Sprint products and services.
In terms of the Dixon partnership, over the next few months Sprint will work closely with Dixons Carphone's Connected World Services (CWS) division on a pilot program to build and operate about 20 new Sprint stores in select U.S. markets. Mellott declined to say which markets would get the news stores.
These Sprint stores will operate similarly to the third-party retailers who operate Sprint-branded stores across the U.S. Sprint will own and staff the stores while CWS will manage them. CWS will also apply its expertise and best practices across all of Sprint's sales channels. Dixons Carphone formerly had a joint venture with Best Buy, and the company helped launch Best Buy Mobile. Best Buy exited the joint venture in 2013.
If the pilot stores prove to be successful, Sprint and Dixons Carphone will launch their own joint venture to open and operate "a substantial number" of new Sprint-branded stores across the U.S. The two companies will equally fund the startup costs of the joint venture and each will initially have a 50 percent ownership interest. Mellott declined to say how quickly this might happen.
Meanwhile, Sprint this week expanded its "Direct 2 You" service, in which sales representatives meet customers at their homes, offices or other locations to set up their new smartphones, to four new major markets: Denver, Los Angeles, New York City and San Francisco. The carrier plans to keep rolling out the offering to new markets throughout 2015, including Dallas; Tampa, Fla. and Washington, D.C., in early July. The program launched in the Kansas City, Mo., metropolitan area in April and then soon expanded to Chicago and Miami. The service involves specially trained Sprint retail employees roving around in cars to meet customers.
While there is no guarantee that increased distribution will translate into more sales and subscriber growth, Sprint is optimistic about its plans. "Sprint is going to offer customers a greatly enhanced experience in buying wireless products and services," Sprint CEO Marcelo Claure said in a statement. "We are partnering with the world's leading wireless retailer to improve the customer experience in our stores. Dixons Carphone has the expertise and capabilities to accelerate this important part of our transformation journey."
AT&T Mobility (NYSE: T) owns more than 2,000 of its own retail stores and has a large network of dealers. In February Claure said Sprint had around 500 or 600 fewer company-owned stores than T-Mobile US (NYSE:TMUS) and around 3,000 fewer than Verizon Wireless (NYSE: VZ), according to a Seeking Alpha transcript of his remarks. Verizon owns around 1,700 of its own stores but also has a large number of dealers.
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Sprint set to open 1,435 co-branded locations with RadioShack tomorrow