Mountain Equipment Company CEO Eric Kloss was driving on a highway during a trip to Toronto last week when he pointed to the side of the road. “There’s the MEC store there,” he said. Another member of the retailer’s executive team looked around in confusion. There was no shop in that area. The car was actually passing through a Toronto-Dominion Bank branch.
It was a funny joke: MEC’s soon-to-be, square green logo was so non-descriptive, Mr. Klaus 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 ever liked it.”
MEC is now removing that logo, in an effort to revive some of the customer affinity that was destroyed by mismanagement at the Vancouver-based retailer. Earlier this week, MEC will swap out the green square in favor of the mountain peak, which was its logo for four decades before its last rebranding in 2013.
That’s making the change a 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, leaving members of the cooperative to vote on the plan, and removed the old structure (which is why its full name is no longer Mountain Equipment Co-op. ).
“The worst thing you can do is take the mic save person and try to convince them that they should come back. It has to happen systematically,” Mr. Kloss 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 types of general merchandise that shelves. It was crowded, complicated sales and alienated many members.
“From a product point of view, MEC was in its heyday, I think, in the nineties,” said Mr. Klaus. “Technical apparel was really very forward-thinking. It was all stuff MEC was known for.”
MEC is now bringing back some of that old merchandise. This year, for example, the retailer re-released its nylon “Red Pants,” once popular among hikers and climbers. Of the initial 4,000 items, 3,000 were sold in the first week, Mr. Kloss said. The retailer is also planning to bring back its discontinued Apex jacket, which has a patch sewn on the inside explaining its origins in the old design.
In addition to working on business turnarounds, MEC is also facing a similar struggle as other retailers as the COVID-19 pandemic continues to rip through the industry – particularly labor shortages, gummed-up supply chains and inflation. In form of. In the price of raw materials such as cotton and stretch elastane. This exacerbated an existing inventory problem at MECs, which canceled their orders early in the pandemic to conserve cash. The move ran out of stock and required a new management team to rebuild relationships with suppliers.
Things are improving. During a recent Montreal store visit, Mr. Claus spoke to a customer who was amazed at all the stock on the shelf. Mr Klaus said the customer told him: “I was here a few months ago, I thought you guys were going out of work.”
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 improved. And some customers are coming back: MEC now has about six million members, up from five million at the time of the sale. The loyalty program Mr. Claus promised to launch has been delayed, but is still in the works.
“MEC lost its way,” said the chief executive. “We’re really trying to refocus our strategies on what makes MEC so great.”
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