Mountain Equipment Co-op - Canadian Co-operative Association

Introduction
Mountain Equipment Co-op (MEC) was founded as a retail
co-operative in British Columbia in 1971. It remains head-quartered
in Vancouver, where it is incorporated under, and governed by, the
British Columbia Cooperative Association Act (1999).
The business began with six founding members who were active
in BC’s early outdoor scene, a tiny store in downtown Vancouver,
and gear focused on climbing. Since then, MEC has grown to
become a national retailer with more than 3.75 million members,
fifteen stores in six provinces, www.mec.ca, a 190,000-squarefoot
Distribution Centre in Surrey, BC, some 1,600 employees,
and a product offering that continues to grow and evolve in step
with active outdoor lifestyles in Canada.
Providing members with clothing and gear for backcountry
excursions to wilderness destinations shaped MEC’s early product
offering. Demographic changes within Canada and the trend
toward ‘front-country’ recreation (close to home for short time
periods) has led to the evolution of what is now MEC’s extensive
outdoor product offering. It includes products and services
that support members’ pursuit and enjoyment of cycling, hiking,
camping, climbing, running, snowsports and watersports, among
other activities.
Stores in Vancouver and Calgary and a relatively small
membership mainly within Canada’s two western-most provinces
largely defined MEC’s growth in its first 15 years in business.
That changed in 1986, when the outdoor retailer opened a store
in Toronto. Now, Ontario has five MEC stores, Quebec has three
stores, and over half of the co-op’s total membership resides east
of the Manitoba-Ontario border.
Widely recognized for its commitment to sustainability and
sustainable business practices, MEC supports various outdoor
recreation and environmental conservation initiatives through
its community involvement grants program. MEC’s sustainability
efforts also include formal programs in the areas of ethical
sourcing, green buildings, and product sustainability.
Quick Facts
Sales
• Lifetime membership is open to anyone by buying a $5
share in the enterprise.
• Almost 90% of MEC’s Canadian members reside in one
of four provinces: BC (16.5%), Alberta (24.2%), Ontario
(32.8%), and Quebec (16.3%).
• In 2011, MEC averaged more than 18,750 new members
per month.
• In all, more than 13,000 separate products are available
for purchase at MEC.
• Approximately 40% of sales stem from private label
(MEC-brand) products.
MEC’s gross sales in 2011 totalled $270.1 million, an increase of 3.4%
(or $8.8 million) from 2010. Ten years previously, in 2001, MEC’s
sales totalled $153.9 million, or 43% less than where they now
stand. The growth can largely be attributed to increased sales from
investments in new stores (9 since 2001, including 3 in Quebec and
3 in Ontario) and the growing popularity of mec.ca, MEC’s fastestgrowing
sales channel.
Pricing
Benchmark pricing has long been a hallmark of MEC’s retail offering.
This ‘low everyday price’ strategy means that members enjoy
access to products that are, on average, 7% below market price.
The strategy is achieved in part through comparatively low margins
and low surplus earnings. For example, from 2009 to 2011, MEC’s
margin averaged 33.4% of sales, while over the same period, MEC’s
surplus earnings averaged 3.8% of sales.
MEC Submission To The Special Committee On Co-operatives 2