MOUNTAIN EQUIPMENT CO-OP: THE PRIVATE-LABEL STRATEGY
CASE 1:
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MOUNTAIN EQUIPMENT CO-OP: THE
PRIVATE-LABEL STRATEGY____________
Critical Issues
In order to fulfill the company’s core purpose and philosophies while still maintaining a viable business operation, Mountain Equipment Co-op (MEC) must address:
How to provide their customers with a unique and desirable product line that no other store can match so that they can own a distinct competitive advantage and do not have to directly compete with other sporting goods retailers.
How to promote the benefits of the company’s co-op structure and its emphasis on creating positive changes in Canada so that they do not lose the advantage of having the customer perception that they are a company with greater objectives than just profits.
How to take advantage of the current popularity of wildernes s-based activities and the consumer trend towards environmentally, socially, and economically sustainable products so that they can continue to be leaders in these areas.
Situation Analysis
MEC exists in a highly saturated and mature market where there is fierce competition between competitors for market share.1 Because MEC is not the “big fish” in this pond, it is forced to come up with a strategy that is unique compared to its competitors. Walmart has taken the entry-level price-leader strategy, Forzani owns the mainstream name-brand market, and independent stores are known for their specialization and expertise. This has forced MEC to provide two main differentiating factors that separate it from the competition and secure its share of the Canadian sporting goods retail market: a focus on wilderness-oriented recreational activities and a Co-operative corporate structure that emphasizes giving back to its members.
Both of these differentiating factors are effective but vulnerable to competition if they are not continuously developed. MEC constantly feels the pressure from other retailers such as Coast
________________________________
MOUNTAIN EQUIPMENT CO-OP: THE
PRIVATE-LABEL STRATEGY____________
Critical Issues
In order to fulfill the company’s core purpose and philosophies while still maintaining a viable business operation, Mountain Equipment Co-op (MEC) must address:
How to provide their customers with a unique and desirable product line that no other store can match so that they can own a distinct competitive advantage and do not have to directly compete with other sporting goods retailers.
How to promote the benefits of the company’s co-op structure and its emphasis on creating positive changes in Canada so that they do not lose the advantage of having the customer perception that they are a company with greater objectives than just profits.
How to take advantage of the current popularity of wildernes s-based activities and the consumer trend towards environmentally, socially, and economically sustainable products so that they can continue to be leaders in these areas.
Situation Analysis
MEC exists in a highly saturated and mature market where there is fierce competition between competitors for market share.1 Because MEC is not the “big fish” in this pond, it is forced to come up with a strategy that is unique compared to its competitors. Walmart has taken the entry-level price-leader strategy, Forzani owns the mainstream name-brand market, and independent stores are known for their specialization and expertise. This has forced MEC to provide two main differentiating factors that separate it from the competition and secure its share of the Canadian sporting goods retail market: a focus on wilderness-oriented recreational activities and a Co-operative corporate structure that emphasizes giving back to its members.
Both of these differentiating factors are effective but vulnerable to competition if they are not continuously developed. MEC constantly feels the pressure from other retailers such as Coast