Tandy Corporation was an American family-owned retailer based in Fort Worth, Texas that made leather goods, operated the RadioShack and Tandy electronics stores, and later built personal computers.
Tandy Leather was founded in 1919 as a leather supply store. By the end of the 1950s, under the tutelage of then-CEO Charles Tandy, the company expanded into the hobby market, making leather moccasins and coin purses, making huge sales among Scouts, leading to a fast growth in sales. Aiming to broaden the company horizon, Charles Tandy acquired a number of craft retail companies, including RadioShack in 1963, then an almost bankrupt chain of electronics stores in Boston.
In the 1970s and 1980s, now led by John Roach as CEO, the corporation started to invest into the personal computer market following the introduction of the popular TRS-80; it was one of the pioneers in the rising personal computer industry, being lauded by the magazine Financial World as "the driving force at the front-running company in the red-hot personal computer race". Unable to keep up with cost-cutting competitors, Tandy exited the PC business in 1993, selling its assets to AST Research, retaining its profitable goods-making units. In 2000, the Tandy Corporation name was dropped, and the entity became the RadioShack Corporation.
History Tandy began in 1919 when two friends, Norton Hinckley and Dave L. Tandy, decided to start the Hinckley-Tandy Leather Company and concentrated its efforts on selling sole leather and other supplies to shoe repair dealers in Texas. Hinckley and Tandy opened their first branch store in 1927 in Beaumont, Texas and in 1932, Dave Tandy moved the store from Beaumont to Houston, Texas. Tandy's business survived the economic storms of the Depression, gathered strength and developed a firm presence in the shoe findings (i.e. shoemakers' tools and supplies) business.
Dave Tandy had a son, Charles David Tandy, who was drafted into the business during his early twenties. Charles obtained a B.A. degree at Texas Christian University, then began attending the Harvard Business School to further expand his education. As World War II escalated Charles was called to serve his country in the military and relocated to Hawaii. He wrote to his father from overseas suggesting that leathercraft might offer new possibilities for growing the shoe finding business since the same supplies were used widely in Navy and Army hospitals and recreation centers. Leathercraft gave the men something useful to do and their handiwork, in addition to being therapeutic, had genuine value.
Charles Tandy returned home from the service as a lieutenant commander in 1948 and negotiated to operate the fledgling leathercraft division himself. He had encouraged and followed the development of that venture through correspondence with his father. Within a short time Charles succeeded in opening the first of two retail stores in 1950 that specialized exclusively in leathercraft. Hinckley did not share the enthusiasm of Dave and Charles Tandy for the new leathercraft division. As a result, the two original founders came to an agreement in 1950 that Hinckley would continue to pursue the shoe findings business and the Tandy partners would specialize in promoting leathercrafts.
The first Tandy Catalog, only eight pages long, was mailed to readers of Popular Science magazine who had responded to two-inch test ads that were placed by Tandy. From 1950 forward Tandy operated retail mail order stores supported by direct mail advertising. This successful formula helped the company expand into a chain of some 150 leathercraft stores. A growing do-it-yourself movement, prompted by a shortage of consumer goods and high labor costs, continued to gather momentum. The fifteen leathercraft stores opened during this division's first two years of operation became quite successful. Tandy began expanding by gaining new product lines; the first acquisition was with the American Handicrafts Company which featured a broad line of do-it-yourself handicraft products, two established retail stores in the New York market, and useful knowledge of school and institutional markets. Sixteen additional retail stores were opened in 1953, and by 1955 Tandy Leather was a thriving company with leased sales sites in 75 cities across the United States.
Tandy Leather became an attractive commodity and was purchased in 1955 by the American Hide and Leather Company of Boston, whose name changed in 1956 to General American Industries (GAI). Charles continued to maintain control of managing the Tandy Leather division while owned by GAI. During 1956, General American Industries acquired three other companies unrelated to the leather industry and a struggle for control of the parent company began. Charles saw the need to emancipate the company from continuing in the direction initiated by GAI. He used all his resources, raised additional money, and exercised his right to purchase the 500,000 shares of stock that were included in the original settlement. When the votes were counted on the day of that pivotal stockholders meeting, the Tandy group took management control of General American Industries.
Acquisition of Merribee and RadioShack In 1961, the company name was changed to Tandy Corporation. The corporate headquarters were also moved to Fort Worth, Texas, where Charles D. Tandy became the president and chairman of the board. Tandy Leather was operating 125 stores in 105 cities of the United States and Canada and expanding significantly. Tandy acquired the assets of Merribee Art Embroidery Co., manufacturer and retailer of needlecraft items, as well as five other companies, including Cleveland Crafts Inc. and brought on the owner, Werner Magnus, to help run the newly acquired Merribee division.
The first Tandy Mart had twenty-eight different shops all devoted to craft and hobby merchandise and included American Handicraft, Tandy Leather, Electronics Crafts and Merribee in an area of about 40,000 square feet. Charles Tandy became intrigued with the potential for rapid growth that he saw in the electronics retail industry during 1962. He found RadioShack in Boston, a mail order company that had started in the 1920s selling to amateur radio operators and electronics buffs. By April 1963, the Tandy Corporation acquired management control of RadioShack Corporation and within two years, RadioShack's $4 million (~$ in ) loss was turned into a profit under the leadership of Charles Tandy.
Sales were going well for Tandy during this time. Under the leadership of Lloyd Redd (president) and Al Patten (VP of Operations), the company prospered. The number of Tandy store-fronts skyrocketed over the next five to six years, growing from 132 sites in 1969 to 269 sites in 1975 as more and more people reveled in the excitement of Tandy. Ground broke in downtown Fort Worth for the construction of the Tandy Towers in 1975. The 18-story office building was initiated as phase I of a massive downtown development with plans to cover eight city blocks and become the new headquarters of the Tandy Corp. It contained an upscale retail shopping center with an indoor ice skating rink and had its own privately owned subway system.
The company's board of directors then announced a plan to separate Tandy's businesses into three distinct publicly held companies. The two new companies were named Tandycrafts, Inc. and Tex Tan-Hickok, Inc. This plan was publicized as a strategy to provide intensive leadership and tailored management of the three distinct and diverse businesses of the company, each of which recently had reached a substantial size. With this transition, RadioShack and Tandy Leather Company were no longer under the same corporate umbrella. Wray Thompson was promoted to president of Tandy Leather Company in 1976 and Dave Ferrill was promoted to the position of National Sales Manager; they oversaw 288 stores. Although they opened their 300th store that year, the popularity of Nature-Tand's products had begun to slide.
Charles Tandy died on November 4, 1978, at the age of 60. Concurrently, key stakeholders began to question the direction of the company. Wray Thompson subsequently resigned from his position as president and later started The Leather Factory with Ron Morgan, which eventually purchased Tandy Leather Corporation in 2000.
Computers
Tandy was one of three companies (along with Commodore International and Apple) that started the personal computer revolution in 1977 by introducing complete pre-assembled microcomputers instead of a kit. Their TRS-80 (1977) and TRS-80 Color Computer ("CoCo") (1980) line of home computers were popular in the years before the IBM PC became commonplace, and had wide distribution in Radio Shack stores at a time when there were few computer stores.
Tandy had 60 Radio Shack Computer Centers by 1980, and expected to have 250 Radio Shack stores that sold its entire computer product line by the end of 1981. By then computers were the most important part of Tandy's sales. The company attempted to monopolize software and peripheral sales by keeping technical information secret and not selling third-party products in Tandy-owned stores. An experimental Tandy computer store at company headquarters sold non-Tandy products until the company banned doing so. A market research company reported in 1981 that not selling others' products slowed Tandy's growth, and predicted that competitors would benefit.
Discussing the report, Wayne Green, publisher of 80 Microcomputing, warned that the company might have become overconfident from defeating "poorly financed and inadequately managed competitors", and that IBM and others would not likely be "as myopic and hidebound as Radio Shack". He wrote that had Tandy continued its experiment, "they might have a couple of thousand Tandy Computer Centers around the country, instead of the Byte Shops and Computerlands we now see. And Tandy would have had a lot more control over Apple and other upstarts". In 1982 he wrote that while its thousands of stores were once a "considerable advantage" over competitors, "the Shack is falling way behind in sales outlets and thus in sales ... we've seen the Apple come along and, with fewer outlets, pass the TRS-80 by in sales". Green warned that the company needed to make "soul-searching, perhaps painful, decisions". Citing a recent study by Time finding what he described in May 1983 as "a severe loss" of Tandy market share, Green said "Until some major changes are made in the approach to computer sales by most Radio Shack stores, I expect that businessmen will be put off by the adjacent counters of toys and gadgets".
Tandy's market share—as high as 60% at one time—indeed declined by 1983 because of competition from the IBM PC and lack of third-party products. Tandy adopted the IBM PC compatible architecture with the Tandy 1000 and Tandy 2000 (1983–1984). The 1000 helped Tandy achieve a 25% personal computer market share in 1986, tied with Apple and in second place behind IBM.
In 1982, Tandy Corporation entered into a development contract with Oklahoma-based software company Dorsett Educational Systems, known for its 25 years pioneering educational technology. The deal resulted in dozens of titles being released for the TRS-80 Color Computer.