https://www.9news.com/article/money/rei-layoffs/73-18e56fdc-0260-4798-a402-a5c51db1a9d2
Market is softening?
Reports on the 4th quarter economy overall were good, including consumer spending. REI’s market segment did very well through COVID didn’t it? Maybe just getting back to steady and sustainable post pandemic? It might be interesting to dig a little deeper.
A lot of people who weren’t into outdoor recreation and sport got into various forms of it all at once. That was a one-time windfall. Now everybody is already geared up for their new hobby, and prices of everything have gone up, so naturally sales are down.
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4rh quarter was pumped up by gov. spending, and gov. jobs created. Bike companies did great through covid but are now choking. People have less money, more debt, higher living expenses, and are back working with less time, no free money hand outs from the government.
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I think the last few years had less to do with it than their overall business plan. They started as a mail order co-op with one retail store then expanded with a few widely spaced stores frugally occupying class B shopping centers. Then lots more expansion into pricey class A centers just as the internet was well on its way exploding with online sales that undercut many brick and mortar stores.
Add to that they shifted some product focus into the high markup clothing market. Only thing is if it doesn’t sell, you have to unload it at a much smaller or no margin. And they can only carry a fraction of the brands and products available. And of course everything is short lived and trendy. If they don’t choose wisely shoppers go elsewhere for more variety.
What I’ve also seen is so many stores have so little and so little variety of inventory. As often as not, I have to have things shipped anyway so why even bother with a storefront. They may still be a co-op but it seems to me they are top heavy with highly paid execs acting like they are the next Walmart.
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[quote=“RC51Mike, post:5, topic:128861”]
I think the last few years had less to do with it than their overall business plan. . . . Add to that they shifted some product focus into the high markup clothing market. . . . seems to me they are top heavy with highly paid execs
[/quote],
This is why I left REI. Years ago I thought they had innovate gear designs, especially tents, and a unique way of relating to customers. Even as a poor student I could afford REI gear. (Going WAY back now.) As they grew and changed their brand image, the customer experience of the old days was lost. I found other stores with better prices and now haven’t bought anything from REI in several years. EMS is another store that started out great and went under. I hope LL Bean doesn’t have the same fate—I’m shocked that they did away with their previously excellent lineup of down sleeping bags. All these stores moved away from their origins supplying gear and practical clothing for ordinary outdoor people. I shop at Kittery Trading Post and Cabela’s now. Pretty good in-store and online experience with them.
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It seems that REI is now run by idiots and they’ve been making a lot of stupid moves. A couple of years ago, they dropped several high-quality, very popular product lines simply because their parent company also owned an ammunition manufacturer. I haven’t spent a dime with them since (I’ve been a member since the 1980s). If they fail, it’s their own fault and I won’t shed a tear.
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I don’t expect REI is completely immune to competition from Amazon. All types of retailers seem to be dropping like flies out there.
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I thought they are still considered a member owned a co-op and there is no parent company.
They opened a new store in Huntington NY few months ago.
He’s talking about the 2018 NRA boycotts. During the boycotts, REI stopped selling brands from Vista Products. Vista is mainly in the shooting sports business. At the time of the boycott, Vista owned at least 4 ammunition makers and Savage Arms who sold AR style rifles. But they also have some brands notable in cycling like Bell, Giro, Blackburn, and they own Camelbak. REI started selling Vista again in 2019 around when they spun off Savage Arms.
More info here, Vista and REI are mentioned about half-way down:
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Thanks, that makes better sense.
Somewhere else on this forum there is a convo about buying kayaks sight unseen from China.
Well, if we value the experience good retail stores provide, then buy your stuff there!
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I’ve been a member of REI since before 1970. I bought a lot of stuff in those days when their catalog was full of extremely useful stories and tips, and each of the board members had written an article describing their most recent adventure trips including gear reviews and trip tips. I saved each catalog for reference for a long time.
Back in the day when you were supposed to, but no one did, pay your own state’s sales tax on out of state purchases, I shopped mainly at REI by mail order for most of my stuff that I have now accumulated over the years. But then they opened a store in my state and that killed the no sales tax benefit for all purchases with them. (LLBean did the same thing with the same result). It didn’t help that they went into the fashion industry business with Yuppie style clothing and cute less than useful gear items. That pretty much dropped REI from my radar.
So now in life that I have a supply of all the useful gear I could ever want, I don’t need to make those big expensive purchases anymore. I have their credit card and make very minor purchases just to keep my membership alive. Not sure why I need to do that when there are so many other sources of what I may need at better quality and less expensive. I was not aware of the Savage Arms boycott at the time, which had I known, may have influenced my purchase choices even more.
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They over-ordered during the Covid boom, coupled with production delays in that period, with the perfect storm of everything becoming available and shipping just when consumer spending on outside dropped precipitously in Q3, 2022. It was a hard needle to thread for outdoors retailers - the retail bike world is struggling right now with the same issues (kayaks and canoes, not nearly as much since most of our product is domestically produced so it’s easier to control inflow of inventory).
No idea if it’s an indicator of the year as a whole, but after a quiet Q4 in 2023 across the paddlesports segment, customers have started calling again this month, and several manufacturers we’ve talked to this week noted big upticks in new or revised-upwards dealer orders for spring, so there’s some reason for optimism that the hangover from 2020-21 spending in the industry may have passed and we’ll be into a healthy, controlled increase this year.
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I found their clothing and even kayaks for women (pink, of course) sexist and that was a major reason I stopped shopping at REI entirely. The breaking point for me was when they developed an advertising campaign aimed at women that was incredibly sexist. I decided to boycot REI for one year and during that year I found several other gear retailers that were just as good or better. I used to be REI’s biggest fan since the 1970s but they changed.
As for in-store service, I don’t find REI salespeople all that knowledgeable about important things like how to fit a backpack. The telephone customer service folks have very little knowledge of outdoor gear. Their job is to keep you from getting access to actual gear specialists.
I like REI and just bought something this morning, a bike helmet.
I have several pair of their Marino wool hiking socks that were a good deal compared to Smartwool. I was in front of their store yesterday but had no desire to go in.
Just looked up the socks . REI wants a bit more than half what I paid for the Smartwool at my independent outdoor shop. I’ll stop in next time.
I got tents. T got bikes
I got better boats than REI.
I’m not going rock climbing.
I don’t like some of the clothing styles.
Like Duluth clothing better.
But I have to go there and redeem my coop bonuses.
Maybe that’s part of the reason some of us are ageing out of their market.