So, thoughts on the demise of Mountain Equipment Co-op?

JohnAbercrombie

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As EriktheViking points out, it's not MEC (the Co-Op) that's being sold, it's all the assets of MEC .

Since the assets include the membership data (purchase history and name, address, email), inventory, and real estate, there's nothing left to the CoOp.

My thoughts for today: :)
If there were a legal maneuver that could stop the asset sale, it probably would have been started already.

The governance structure of MEC was set up to allow the Board to do this (dispose of assets). A classic example of: "It seemed like a good idea at the time" ??

I've been a MEC member for about 45 (?) years. I always looked at the list of candidates for Board elections, and I don't ever recall seeing proposals for down-sizing the product offerings or the number of stores or reducing sales volume. It was usually a choice between people who seemed to have some business skills vs 'social activists' . But my memory may well be incorrect.

I wonder how many of the 5 million 'members' are actually active - or even alive?

For me, MEC has been acting like a private corporation (with a better than average refund policy) for 20+ years. It will probably continue spiral downward for a couple more years (like Hudson's Bay did, as mentioned above) until it is gone.

Lots of media reports about the MEC asset sale have mentioned COVID and competition from Amazon and Walmart as factors.
Those seem bogus to me. MEC has done a roaring business during COVID and it's hard to imagine anything that Walmart (or amazon) sells that would compete with MEC's offerings.
Did those ideas come from current Board members and executives? Perhaps it's part of a campaign to deflect attention from mis-management in past years.
A quick look at the balance of product offerings on the website, and the (long) list of retail stores will tell a lot about the probable source of difficulties.

It's interesting that REI isn't the purchaser. MEC has been trying to be 'REI lite' from the get-go and has mirrored a lot of the changes at REI.
 

AM

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I listened to CBC’s “On the Coast” yesterday and the host interviewed one of the original founders of MEC, who speculated that the sale is really about real estate holdings. IE: the long-term future is not in retail. I have no idea if that is true, but I thought it would be worth mentioning.

Cheers,
Andrew
 

eriktheviking

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Yes that was Jim Byers. His take sounds similar to many of the views here that MEC lost its way some years ago, so trying to save it now, however well-intentioned, is much too late. One of the few non-paywalled stories with an interview with him is here.
 

kayakwriter

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I hope that when the smoke clears, KayakWriter will weigh in with his perspective from both sides of the looking glass - within and outside MEC.
So after 25 years of service, MEC decided about 5 years ago that I did not fit the new direction they were going and didn't look fetching in bike Lycra or yoga pants (they were not wrong about that!) My severance package included a non-disparagement clause, so there are limits to what I can say unless and until MEC is totally gone.

In the meantime, Anders Ourom, a lawyer and an MEC Board Member back in the early days, is working on a "Hail Mary" plan to see if he can raise enough capital from the members to offer the bankruptcy court an alternative to selling to the American venture capital corp. If you search Anders' name on Facebook, you'll find him. I've pledged $100. I think it's a long shot, but I'm willing to chance a bit for the hope of turning MEC back into a truly member-controlled co-op.
 

Dan_Millsip

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The Co-op has long abandoned it's economic model and purposeful structure. Policies developed over the past ten to fifteen years for board elections changed the direction to one that no longer represented the original core values of the co-op.

I think the nail in the coffin moment was when David Labistour took over as CEO and attempted to turn it into a trendy garment store. The excellent employee culture was annihilated and the company became more focused on profit than ideals. Labistour broke a lot of stuff that didn't need fixing.

The co-op model is a great example of how it 'could' and 'can' work and has much merit - unfortunately at this point in time and in this case, MEC is not a model of what works but it's a great example of what can go wrong.
 

JohnAbercrombie

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In the meantime, Anders Ourom, a lawyer and an MEC Board Member back in the early days, is working on a "Hail Mary" plan to see if he can raise enough capital from the members to offer the bankruptcy court an alternative to selling to the American venture capital corp.
It's not clear how much money would need to be involved. Aren't the MEC assets several hundred million dollars?
With their 3% fee, GoFundMe would be happy to organize that!
:)
It's not easy for me to understand how an entity with assets valued at so much more than liabilities ($100 million?) couldn't handle a $25 million operating loss when interest rates are so low, but I lack the 'business wheeler-dealer' gene.
Apparently the idea is to raise enough money (from 'true believers') to convince the judge that the rest of the MEC membership would be willing to 'pitch in' ? Without access to the MEC email database, it seems like a long shot, unfortunately.
 

Hairygrump

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Do you have some ideas on this topic?
There aren't any outlets 'in town' in Victoria any more if MEC closes or continues to reduce its stock of paddling gear, are there?
And for boats, even fewer possibilities with Ocean River gone. The list of boat brands that we don't have access to, is long.
So then for paddles and gear/clothing it's mail order/online shopping. And not many businesses (Coast Outdoors? Western Canoe?) seem to be very interested in mail-order. Shipping is expensive unless a company is big enough (e.g. Level Six) to negotiate a deal with Canada Post. Aquabatics in Calgary does mail-order.
KayakAcademy in Seattle is also a reliable mail-order source for tested gear.
It's been discussed at length; the sea-kayak market is small and shrinking.
Some one will fill the void. I work in a bike shop that is now doing a massive amount of business online and that’s really only something that’s evolved in the last 12 months. We use flat rate same day shipping from CanadaPost like everyone else. With very few local paddling shops out there it’s only a matter of time till someone steps up.
 

Roy222

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Knowing nothing about the subject: my guess:
MEC started to change, as described above, after they hired over paid Ivey League MBA. They the over paid MBAs needed to prove their worth so they made changes, usually stupid changes. Once that downward spiral starts it only ends badly.

Here in the states we have REI, so far so good. But it is so much easier to click on Amazon then to drive half way across town.
I bet a lot of MEC customers window shopped at the store and then when home and let their fingers click on Amazon or what ever.

The real question is, are the members of MEC actual owners? When MEC is sold will the members get paid?
If the answers are , NO and NO, that tells you everything, the real owners are chashing in!
 

eriktheviking

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The short version is that the member data is listed as an asset, and the proposed sale is for all of MEC's assets.
...

I have sent my own message to the "privacy@mec.ca" email and will be interested to see the reply.
I did receive a reply to my question, and this is also posted at MEC Transaction FAQs. They state:
4. What will happen to member information?
Canadian privacy laws permit MEC to transfer customer data (such as information about customer purchase history and marketing preferences), to the new company as part of the larger sale of MEC’s assets to the new company.

This information will be used by the new company for legitimate business purposes and in compliance with privacy laws, including for product recalls and warranty returns under MEC’s Rocksolid Guarantee.

By law, the new company is only entitled to use or disclose the transferred personal information for the same purposes for which MEC originally collected the information from you or as required by law. It is not permitted to use or disclose your information for any other purpose that requires your consent without first explaining the new purpose to you and then asking for and obtaining your consent.
I guess I would observe that if I buy something at MEC it is always tied to my membership number. If I make purchases at other retailers, such close tracking is not normally possible.
 

JohnAbercrombie

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I guess I would observe that if I buy something at MEC it is always tied to my membership number. If I make purchases at other retailers, such close tracking is not normally possible.
Most online retailers I deal with have my name, address, and email, and purchase history, and even though they don't admit it, I think most of them have my credit card info (if I use a CC) even when I check the 'Don't save my Card info' box.

I don't mind that. I really don't see the concerns about 'MEC data' being sold.

But I won't use Facebook or Gmail for communicating, since I'd prefer to keep my fanciful ideas about communications being semi-private.
 

pawsplus

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MEC saved my life last summer when I broke kayakwriter's expensive tent and they were able to fix it for me!!! I'm sad about this. I hope MEC will still be a good place.
 

kayakwriter

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I'm sad about this. I hope MEC will still be a good place.
I have several concerns about that, both as a member and as a former employee.

In their press releases, the new owners, Kingswood Capital Management, refer to "customers," not members, so we can assume they have no intention of letting us vote or otherwise have any meaningful say in determining the future of MEC. Likewise, members have (or had) both their ownership share (the $5 you paid to join MEC) and patronage bonus dividends (shares you accumulated based on the value of your purchases). Those patronage dividends could amount to several hundred dollars for big spenders, and in better times MEC would periodically buy down everyone's patronage shares to a couple of hundred dollars or so by sending out cheques or MEC Gift Certificates. It's my understanding that for both ownership and patronage dividend shares, we're all standing in line with other creditors, and I'm not sure what number in line we are. We may wind up getting pennies on the dollar, if anything. If that happens, it would discourage me from giving them any more of my money.

On the former employee side: I was let go several years ago, so I got the full payout from my severance package. However, I've been told from reliable sources that former long-term employees who were let go more recently, but before the sale was announced, had been receiving salary/benefits continuance as their severance packages, but that those payments stopped recently. So unless those payments resume (with backpay), friends and former colleagues of mine are getting stiffed. Again, a good reason for me personally not to give MEC any further business.

And finally, as someone who for worked for MEC for more than 25 years, I was automatically eligible for a lifetime employee discount. MEC had always honoured this, including on a couple of mail orders I made a few weeks ago. I received an email today advising me that the new owners won't be honouring that discount after October 29th. The email ends with a strong contender for most tone-deaf concluding line of the year: “Thank you for your continued loyalty.” Sure.
 

Gary Jacek

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In my entire 40 year career I worked in a union shop for a total of 3 months. That said, I firmly believe that unions serve a valuable purpose and a corporation gets the union it deserves. And this reeks of union busting And a race to the bottom.
 

JohnAbercrombie

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"Sold by MEC, Fulfilled by amazon"
That was my guess, too, reading between the lines of that corporate bafflegab.
No surprise, really.
Outdoor-related gear is in short supply everywhere, with record profits. So that's no excuse. It's just the usual rapacious corporate takeover behaviour. We must like it.
 

RFT

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I am one of the very early members, back when MEC was located on West Hastings in Vancouver. Was so proud when things moved to the swanky digs on West 4th. Up until the 'Toronto Takeover', I did all of my gear and technical clothing there. Used to be super proud of the recycled fabrics, quality products, customer service and ethical biz practices. The 'Toronto Takeover' ruined MEC for me, Tech clothing became fashionable and stupid expensive but I slowly accepted that the lifestyle that has been normal for me has become very popular and I eventually gravitated towards MEC's success amongst the competitive fashion/gear industry. I was and am very saddened by the recent American takeover. The future of MEC is very predictable now. Good Luck MEC, you were a big part of my life.
 
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