Mountain Equipment Co. CEO Eric Claus was heading down a highway during a visit to Toronto last week when he pointed to the roadside. “There’s the MEC store,” he said. Another member of the retailer’s executive team glanced around, confused. There was no store in that area. The car was actually passing a Toronto-Dominion Bank branch.
It was a wry joke: MEC’s soon-to-be-defunct, square green logo was so non-descript, Mr. Claus felt, that it could easily be mistaken for any other type of business.
“I mean, we could be a pharmacy, we could be a software company, who knows?” he said in an interview. “Nobody’s ever liked it.”
MEC is now doing away with that logo, in an attempt to revive some of the customer affinity that was eroded by mismanagement at the Vancouver-based retailer. Beginning this week, MEC will be swapping out the green square in favour of the mountain peak that was its logo for four decades before the last rebranding in 2013.
It’s making the change one year after the company emerged from creditor protection, which facilitated a $150-million deal to sell the 50-year-old retailer to California-based private-equity firm Kingswood Capital Management. A group calling itself “Save MEC” opposed the deal, which did not give the co-operative’s members a vote on the plan, and did away with the old structure (which is why its full name is no longer Mountain Equipment Co-op).
“The worst thing you can do is take a Save MEC person and try to convince them that they should come back. That has to happen organically,” Mr. Claus said.
What the rebranding represents, he said, is a strategic shift, focusing more on MEC’s roots – products for outdoor activities such as hiking, climbing, camping and skiing – and less on the type of general merchandise that had crowded the shelves, complicated merchandising and alienated many members.
“From a product point of view, MEC was at its heyday, I think, in the nineties,” Mr. Claus said. “The technical apparel was really very forward-thinking. There was all this stuff that MEC was known for.”
MEC is now bringing back some of that older merchandise. This year, for example, the retailer reissued its nylon “Rad Pants,” once popular with hikers and climbers. Out of an initial run of 4,000 items, 3,000 were sold in the first week, Mr. Claus said. The retailer is also planning to bring back its discontinued Apex jacket, with a patch sewn on the inside explaining its origins in the old design.
In addition to working on a turnaround of the business, MEC is also facing the same struggles as other retailers as the COVID-19 pandemic continues to reverberate through the industry – particularly in the form of labour shortages, gummed-up supply chains, and inflation in the cost of raw materials such as cotton and stretchy elastane. That compounded an existing inventory problem at MEC, which cancelled its orders early in the pandemic to conserve cash. The move left stock depleted and required the new management team to rebuild relationships with suppliers.
Things are improving. During a recent visit to the Montreal store, Mr. Claus spoke with a customer who marvelled at all the stock on the shelves. Mr. Claus said the customer told him: “I was here a few months ago, I thought you guys were going out of business.”
The company has some financial breathing room. MEC remains debt-free, after the Kingswood deal wiped out more than $70-million in debt. Sales have been improving. And some customers are coming back: MEC now has roughly six million members, up from five million at the time of the sale. A loyalty program Mr. Claus promised to launch has been delayed, but is still in the works.
“MEC lost its way,” the chief executive officer said. “We’re really trying to refocus our strategies to be more like what made MEC so great.”
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