MEC in reecievership

[LHutz Esq]

Well there goes that:
https://www.bccourts.ca/jdb-txt/sc/2...20BCSC1586.htm

" I accept that this decision is a disappointing conclusion to the fate of what was an iconic Canadian retailer who has inspired the passion and commitment of many Canadians for outdoor activity. Like many Canadian retailers, MEC has fallen victim to economic forces, and perhaps questionable business judgments made years ago, all exacerbated by the cataclysmic and unprecedented impact of the COVID-19 pandemic throughout most of 2020.
This result, however, will ensure the continuation of MEC’s business, albeit in another organization. While this sale transaction is not wrapped in the Canadian flag, the best evidence is that Kingswood will continue to support MEC’s core values and principles, being community engagement and promotion of a healthy outdoor lifestyle. More importantly, the ongoing operations will support Canadian individuals and their families and also businesses where jobs are disappearing quickly given ongoing economic disruptions. Creditors will be paid, or paid a substantial portion of what they are owed, no doubt to the relief of many."

[t.odd]

How is covid responsible for anything? every outdoor retailer I know has had the one of their best seasons in recent memory.

anecdotally, when I was in the North Van store in mid August, they were picked over of traditional outdoor rec stuff, camping supplies, tents, packs, bike stuff, etc....much of what remained was the more premium clothing brands they've brought in over the past years....so yeah, they made a lot of bad decisions that lead to having a lot of stock of things people weren't really interested in, while everything I'd consider a bit more 'traditional' mec was very much in demand.

[shirk]

How is covid responsible for anything?

Covid caused the initial store closures across the board. Early in the pandemic ALL outdoor retail closed down. MEC happened to already be in a really shitty credit situation before covid hit. They got squeezed, too much cash going out and not enough coming in.

With everyone shut down, SAIL filing for bankruptcy and MEC behind on payments distributors also stopped sending MEC good (see t.odd observation above). LOTS of retailers got put onto pay up front terms, no more credit. While some have had a good year as summer developed I can tell you most all those shop owners you thing had their "best year" also have a very dark period before it bounced back.

[LeeLau]

How is covid responsible for anything? every outdoor retailer I know has had the one of their best seasons in recent memory.

Their RY Line of Credit had covenants. MEC was already close to default. Covid put them further into default. A competent organization would have standby LOCs possibly securitized. MEC can be accused of much but competence was not one of them. Even in April/May there were vulture funds sniffing around for receivables LO

[xyz]

Their RY Line of Credit had covenants. MEC was already close to default. Covid put them further into default. A competent organization would have standby LOCs possibly securitized. MEC can be accused of much but competence was not one of them. Even in April/May there were vulture funds sniffing around for receivables LO

You must of made a killing shorting your membership.

[garyfromterrace]

You must of made a killing shorting your membership.

Ha, good one. I will miss the coop (especially the one of old), but I maintain as has been said it wasn't run well lately. Opening 2 additional stores in Calgary was such madness. The decisions made at a board level sucked in the last few years.

[LeeLau]

You must of made a killing shorting your membership.

Managed to return my 3 year old hiking boots. Going to try for the bike shoes next

[xyz]

Managed to return my 3 year old hiking boots. Going to try for the bike shoes next

I was going to return my 10 yr old hiking boots at the end of a trip. Halfway through the trip, they completely fell apart. I took pictures of the remains to use for a return. They actually denied my claim. Assholes.

[ex-powderbroker]

Ha, good one. I will miss the coop (especially the one of old), but I maintain as has been said it wasn't run well lately. Opening 2 additional stores in Calgary was such madness. The decisions made at a board level sucked in the last few years.

Two stores in Montreal as well, one of which is completely useless. The board should be ashamed.

[danmelon]

Two stores in Montreal as well, one of which is completely useless. The board should be ashamed.

They actually closed one in Montreal a few years ago. It was a MEC shop nestled among chi-chi clothing and shoe store on Saint-Denis Street. No gear, just clothes and shoes and sunglasses. Was such a dumb idea, although I used to get all my gear shipped there because I lived pretty close. I think they were aiming for a lulu lemon vibe...

[ex-powderbroker]

that’s the one i was talking about, it was still there last i looked. i guess that must have been in 2019.

“We loved this little store, but a travel boutique isn’t quite right for us. You don’t know until you try!”

plus stores in Laval, Longeuille, and marche central each 15 minutes away.


DUMBASSES

[danmelon]

that’s the one i was talking about, it was still there last i looked. i guess that must have been in 2019.

“We loved this little store, but a travel boutique isn’t quite right for us. You don’t know until you try!”

plus stores in Laval, Longeuille, and marche central each 15 minutes away.


DUMBASSES

Ah ok... coulda swore that closed a few years ago, but maybe i did too many marijuanas

[ex-powderbroker]

time flies when you start XC skiing bro

[garyfromterrace]

that’s the one i was talking about, it was still there last i looked. i guess that must have been in 2019.

“We loved this little store, but a travel boutique isn’t quite right for us. You don’t know until you try!”

plus stores in Laval, Longeuille, and marche central each 15 minutes away.


DUMBASSES

Wow, the ineptness knew no bounds. Dumbasses indeed.

[xyz]

https://www.citynews1130.com/2020/05...ction-rigging/

MEC. What a hot mess.

[pureantigravity]

I wonder what their top 10 selling products were, apart from the boutique chocolate they sell near the cash register lineup.
The bike staff and ski staff were always good. I noticed lots of staff turnover the last 5 or 6 years.
I don't know if there is a place for MECs anymore. I buy from local boutique ski/sport shops and the rest from online.
I think the first sign for me that MEC was losing touch was when they buried the used gear sell section and it seemed to disappear.
RIP MEC.

[ex-powderbroker]

Looks easy to point at where it started to go off the rails:
https://www.vancouverobserver.com/li...r-does-it-suck

Amazing that they had these 'recommended' board members that flushed away decades of building something in a few years. Sounds really American.

[sillybunt2]

It seems any business that relies on constant growth and expansion to maintain financial viability is based on a flawed model and doomed. Sorry to see the old Mountain Equipment gone. I hope this helps the local shops to maintain their niche position.

[dufferdan]

Looks easy to point at where it started to go off the rails:
https://www.vancouverobserver.com/li...r-does-it-suck

Amazing that they had these 'recommended' board members that flushed away decades of building something in a few years. Sounds really American.

I have had a membership since 1979 or 80. I viewed it as simply access to the gear for sale, no moral or ethical connection at all. It was a store, and the gear was value for money. Really, the only place in Canada you can get pretty much everything you need for outdoors in one place.

I never paid any attention to the board structure or financials. But after this announcement, I went back and looked at the 2018 and 2019 reports. Pretty easy to see net margins were negative, they had done a bunch of sale-leasebacks with 5 year obligations on property they owned and they were still putting multiple stores in shakey locations...eg....one store in central Calgary was fine. Two more? Yeesh....

Then I read about the recommended Board thing. That shocked me. Concerned members should have sued at that point. While typically management puts up potential board candidates for election, their qualifications should speak for themselves. Shareholders then elect from an even slate.

The email I received the other day about the sale looks like it is going through. Fewer layoffs than originally planned, I like that as well. Fewer store closings. Hopefully they all can turn a profit. Focus on core gear to core buyers and get back to being the best for outdoor gear, not fashion. At least for this country.

It’s a store. Not a church....




Sent from my iPad using Tapatalk

[XXX-er]

https://www.cbc.ca/news/canada/briti...sold-1.7538013 I wonder how this is going to shake out ?