MEC (Canada's REI) losing lots of money [Archive]

45K10

12-02-2019, 09:51 AM

As an American who lived in Vancouver a few years ago, I never understood how MEC made it work. Their prices were crazy high and MEC stuff was okay, albeit I am wearing a MEC fleece as I type this. I would easily shoot across the border and get stuff much cheaper. However, when I was living in Canada the exchange rate was almost 1 to 1.

They did have the best price on tubes in Vancouver but that ain't saying much.

rain dogs

12-02-2019, 10:46 AM

Nobody needs to feel sorry for MEC. Firstly, they´ve been gaming the system and their members (of which I am one) for decades with the "co-op" angle.

Originally, the co-op began to give people better prices, service and house-brand goods for members, while the co-op leveraged that legal status to pay less taxes than a standard corporation.

What it became is a monster that attempted to make everything (including bikes) as cheaply as possible, all while charging high or higher prices than the competition, and doing some pretty nasty predatory tactics against small shops in the area.

MEC owns ALL their stores. They've not kept to their promises of quality nor cheaper prices for non house brand goods. They've not contributed the taxes they should have to the govy and they've just used the 'co-op' as a benefit for executives vs the members.

They get back to their roots and things would likely change drastically, but they're too corporate for that now.

zzy

12-02-2019, 10:58 AM

MEC's products are trash now. Back when they were made in Canada, especially their Serratus house brand, that stuff lasted FOREVER. They made one model, only in black, and sold it for years. I still have my MEC backpack from Jr Highschool. Today it's all thin materials and made in China, in several colours, and new models every year. They also hassle you far more now when you return stuff with a lifetime warranty that was failed.

And I agree 100% with the above - they are CoOp in name only and one of the most aggressive price competitors around. I remember when they were selling Park Tool stuff at below wholesale until Park cut them off completely. However, whenever I go to the new Toronto store on Queen street, everything seems way more expensive than the one on King.

Black Dog

12-02-2019, 11:18 AM

Yes, they lost direction a long time ago when they stoped focusing on outdoor gear for, you know, going outdoors. They started getting into urban outdoor fashion and let the quality and functionality slide. Actual gear that would survive being outdoors and not outside went away. They still make great tents and sleeping bags as they always have, but beyond that not much else. Now it is like any outdoor retailer with the same outdoor fashion brands. So many new stores so quickly and a dilution of the core of the original mission have caught up to them. They would have been better served staying smaller and focused on what they did so well. They used to be the best at what they did and everyone was chasing them, now they are like everyone else. Sad. Urban Sombreros.

https://itsasliceofbree.files.wordpress.com/2014/04/elaineurbansombrero.png?w=698

dancinkozmo

12-02-2019, 11:36 AM

anyone know if SAIL is any good ?

pdonk

12-02-2019, 12:07 PM

anyone know if SAIL is any good ?

There is one by my office - Hwy 7 and 400 in Vaughan.

Really depends on what you are looking for, I have had good luck finding winter gloves I like there.

As for Mountain Equipment Co Op - as above - there is a reason they rebranded to MEC.

ultraman6970

12-02-2019, 12:20 PM

With the insane amount of different taxes to products you guys have over there, doesn't surprise me that they are/were trying to do everything possible to stay competitive.

veggieburger

12-02-2019, 12:24 PM

anyone know if SAIL is any good ?

For what they sell, not bad. Loads of hunting and fishing gear, good selection of ammo and camo, some decent sales. I have not attempted a return, and I'm not sure if they have Sail branded gear.

ryker

12-02-2019, 12:38 PM

Assets are up, sales are up, margins are up, some one-time charges in this fiscal year -- I'm not sure there are major conclusions to be drawn here.

I relate to the comments about the good old days as I've been to MEC half a dozen times this year and not been able to find items from their online catalogue (as recently as yesterday). They say there's not enough floor space to keep everything on hand but they have room for a yoga section. Times change.

The other recent MEC news I found interesting is the Victoria store unionized. It would be interesting gossip to know about that decision. My casual chats with MEC employees suggest it's a decent gig.

ryker

12-02-2019, 12:50 PM

Nobody needs to feel sorry for MEC. Firstly, they´ve been gaming the system and their members (of which I am one) for decades with the "co-op" angle.

Originally, the co-op began to give people better prices, service and house-brand goods for members, while the co-op leveraged that legal status to pay less taxes than a standard corporation.

MEC owns ALL their stores. They've not kept to their promises of quality nor cheaper prices for non house brand goods. They've not contributed the taxes they should have to the govy and they've just used the 'co-op' as a benefit for executives vs the members.

From a tax perspective I don't think there's much difference between a co-op and a regular corporation. Can you elaborate? A co-op isn't a non-profit.

How have execs used co-op status for their own benefit rather than in the interests of members?

Black Dog

12-02-2019, 01:36 PM

From a tax perspective I don't think there's much difference between a co-op and a regular corporation. Can you elaborate? A co-op isn't a non-profit.

How have execs used co-op status for their own benefit rather than in the interests of members?

This was my thought as well.

TEMPLE

12-02-2019, 02:14 PM

Yeah, I am not on board with the MEC bashing going on here. The intrinsic purpose of a co-op is to lower prices, so we can hardly disparage MEC for pricing aggressively. They treat their employees well, and I have always found their staff to be extremely knowledgable and helpful. Given the option, I'll always support a business that pays employees a better wage. I've never liked anything MEC-branded, ever. Even back in the so-called halcyon days, it was janky ****. But, the other products and services have remained excellent, in my opinion.

Anyways, we are talking about a company that made, what...400 million in revenue last year and had a loss of 11 million? I'm not particularly worried about MEC's financial health...

deechee

12-02-2019, 02:24 PM

Funny how we all have the same sentiments. I think the fact that MEC has a former Best Buy exec as CEO says a lot. I read some articles about people not being happy with the board elections over the years; how some people were ousted in a way. Honestly, I'll have to admit I haven't been paying attention the elections in a long time.

I'm not sure why people say its not a co-op. I've had years where I had small amounts returned to me. You have the right to vote for the board.

Yeah, MEC had some low cost products that were tough (ie. the backpacks), but their clothes have never really been up to par if you ask me. I've had some of their stuff to use as cheap workout gear, but now I don't bother. I have a bunch of their duffles (which have survived a lot of airline bashing), but the last big bag I bought was a Patagonia. No one has a monopoly on cheap in-house brands anymore. LaCordée, SAIL/Le Baron, Walmart all have their cheap stuff. (And now Decathlon in downtown Montreal?) . The brand name stuff isn't well priced, and rarely goes on sale.

But amid all this complaining, I have to admit, after searching high and low for a winter jacket for my son, MEC's down jacket for toddlers has been my son's favourite jacket. He hates hats and gloves but this jacket is the one thing he absolutely loves; and it keeps him warm in all temps. I had no issue paying full price for a bigger size this year. At 100$ it's a steal. So, they *do* make some really good clothes. Just not for adults ;)

rain dogs

12-02-2019, 02:32 PM

The intrinsic purpose of a co-op is to lower prices, so we can hardly disparage MEC for pricing aggressively.

MEC prices aggressively HIGH.... as in expensive. In Vancouver, you go to any other store on the broadway strip and you'll get the same item (an MSR item for example) for cheaper.

I don't have time to look up all the details and do not recall all of them either, but MEC gets a tax break on the buildings they own. They don't pay the same taxes re: member contributions. They aren't a non-profit, no, but profits are supposed to be cycled back to members, but they've long ago abandoned that idea (although they pay small dividends now and again) and instead keep jacking up executive salaries and investing profits into building ownership instead of paying member benefits.

In my world a co-op looks for start/up funding from members, builds for members, and if it's successful, returns the success back to members.

MEC demands people become members, charges the highest prices in the neighbourhood, doesn't pay dividends and 'invests' profits into executive salaries and building ownership, all while putting smaller business out of business by demanding exclusive agreements with suppliers. etc.

This stuff is long out there. Anyone from Vancouver is well versed in the general disdain for MEC business tactics on Broadway.

Tell me this: What does MEC do that demands or warrants membership from a customer?

pdonk

12-02-2019, 02:44 PM

I'm not sure why people say its not a co-op. I've had years where I had small amounts returned to me. You have the right to vote for the board.

In my close to 30 years of being a member I have never received a share return. Most years I spend at most a few hundred dollars at MEC, you must be a big buyer to have gotten something back.

scopes

12-02-2019, 03:38 PM

https://www.cbc.ca/news/canada/british-columbia/mec-union-victoria-vancouver-outdoor-retailer-unfair-labour-complaint-1.5358635

Here's an interesting article about some things going down with the local MEC...

zzy

12-02-2019, 03:48 PM

Yeah, I am not on board with the MEC bashing going on here. The intrinsic purpose of a co-op is to lower prices, so we can hardly disparage MEC for pricing aggressively.

Since this is a bike forum, you may want to ask your local bike store how they feel about MEC's practices. They undercut LBSs aggressively on the same product from the same distributor, which was allowed because they agreed to not have a service department or sell bikes and they were a "coop". MEC reneged on that, and kept selling the products, which really hurt local shops, and led to many distributors cutting ties in anger to MEC. As a result now MEC rebrands crap Chinese products to fill the void (especially for tools) or are otherwise handcuffed by strict MSRPs. The Park Tool saga was typical of all this.

And if you think their house products were "janky" you are a fool. I wore down many MEC products for years or even a decade+ of use, and they never failed on me in the field, which is more than I can say for many more expensive pieces I had. And when they were worn out they could be returned for a free fix or even replacement, even if 15 years old.

xnetter

12-02-2019, 09:19 PM

Agree that MEC had some bombproof house brand products back in the day (the 90's for me). I still have a Serratus backpack/airline bag that was a super cool design and is still in great shape.

I do also agree that the place has gone downhill. Some things are still OK but I've begun looking elsewhere for better options. I wouldn't say prices are always higher than the competition but you def don't get much of a discount. The place does do a great job of being an accessible outdoor store with knowledgeable and friendly staff. What other chain store in Canada can you go to find a wide selection of tents in stock and on display? There aren't many and the competition varies greatly. It sounds dumb but MEC has solidified itself as the default place to do to buy this stuff - for better or worse.

My wife and I bought something at REI recently when in Seattle and we went through this long thing with the cashier trying to figure out if we already had a membership and what the associated phone number was, blah blah. Finally the guy said, "well you don't really need to be a member anyways." We were like, huh? Even though a lifetime MEC membership only costs $5, you do need it to shop there.

KJ

GonaSovereign

12-02-2019, 09:31 PM

"It's not like it was in the old days."
"It's too cheap."
"It's too expensive."
"You need to be a member and it costs five whole dollars for a membership that only lasts one lifetime."

People. Please.

I have plenty to gripe about with the the Co-op, but I won't because it's been more good than bad to me over the years since I first visited and paid my fiver back in in the '80s.

adub

12-02-2019, 09:43 PM

I have slowly migrated from not shopping at MEC as over time they have just become "another" big box retailer, promoting the false guise that they actually give a **** about the environment, they clearly don't live by their shtick. Just look at their rapid expansion, building new spaces for their expansion.

They still pride themselves with a sign on the door that you won't get a plastic (or paper) bag, yet you can purchase Yeti coolers, and a bunch of other made in china plastic garbage camping goods. This is just weird.

They talk the talk with being sustainable, carbon tracking, fair trade, 1% for the planet, etc, yet sell Adidas, Nike, and a store full of other goods (the stores now are at least 1/2 full of casual clothes, ALL made in China) some from companies that have a jaded past with questionable labor and environmental practices, etc.

Many of these rapid growth companies that pride themselves with being so sustainable, and all the good they do, yet clearly just use this as a marketing ploy have to eventually ask themselves of why they exist..

Once you are competing with Dicks sporting goods, Bass Pro, Wal mart, et al you have become that.

mcc21

12-04-2019, 01:03 AM

expanded too fast to other parts of Canada. Then they moving into a state of the art eco /Green friendly location this year. All this investment when the online business model is where shopping is gearing towards. MEC should revamp their selling model and try to go with the present times. In a few years this company might be gone sadly.