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The Private-Label
Strategy
Presented by-
Kuhu Pathak
Abhijeet Thorat
Case Synopsis
• Current scenario of the sports equipment market in Canada vis-à-vis MEC’s
strategies
• Mountain Equipment Co-op (MEC) is a well-known Canadian retailer of gear for-
Mountaineering
Rock climbing
Ski touring
Hiking
Major players
in Canada
Wal-Mart Canadian Tire
Forzani(20% of
Industry share)
MECs facts-
 MEC HOLDS ONLY 1.2 % OF THE MARKET
 15 stores across Canada
 Online & physical revenue - $248mn
 1,387 employees
 Retail wage of $10 to $11 per hour.
 3 major USPs-
• Focus on wilderness-oriented recreational activities
• Co-operative corporate structure
• Economic, Social, Environmental Sustainability
• Lifetime membership $5
• 50% of SKUs occupied by MECs Branded items
• Business strategy- UNDER
CUT
COPY
MANUFACTURE
PRICE-
OUT
REPLACE
Lowering of
Brand Image
* Shortage of willing employees in Canada
* Cheaper labor available in Asian countries
$19 CAD vs. $0.6 CAD per hour
Moving manufacturing away
from Canada
Pricing competitors’ brands higher in
category of own private labels (thermarest)
Developing
private
brands
• Extended lead times in
Canadian factories
• Less responsiveness to
market demands
Canadian Market Share By Competitors
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
30.00%
35.00%
40.00%
45.00%
Forzani Total Canadian Tire Walmart MEC Independent Stores Others
MARKET PLAYERS
Mec is competing in highly fragmented market
It enjoys only 1.2% of the total market share
Country Of Origin
Canada
30%
Other
70%
PRODUCT ORIGIN
Canada
Other
Most of the products are getting manufactured in Asia because of low cost,
labour, manufacturing cost etc.
Recommendations
Deliver its own product line
Focus its Core strengths (company philosophies)-
• Ethics
• Quality Goods
• Competitive prices
Refrain from practices like selling competitor’s brands at higher prices
Focus and develop Social-media
Mountain Equipment Co-op: The Private Label Strategy

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Mountain Equipment Co-op: The Private Label Strategy

  • 2. Case Synopsis • Current scenario of the sports equipment market in Canada vis-à-vis MEC’s strategies • Mountain Equipment Co-op (MEC) is a well-known Canadian retailer of gear for- Mountaineering Rock climbing Ski touring Hiking
  • 3. Major players in Canada Wal-Mart Canadian Tire Forzani(20% of Industry share)
  • 4. MECs facts-  MEC HOLDS ONLY 1.2 % OF THE MARKET  15 stores across Canada  Online & physical revenue - $248mn  1,387 employees  Retail wage of $10 to $11 per hour.  3 major USPs- • Focus on wilderness-oriented recreational activities • Co-operative corporate structure • Economic, Social, Environmental Sustainability
  • 5. • Lifetime membership $5 • 50% of SKUs occupied by MECs Branded items • Business strategy- UNDER CUT COPY MANUFACTURE PRICE- OUT REPLACE
  • 6. Lowering of Brand Image * Shortage of willing employees in Canada * Cheaper labor available in Asian countries $19 CAD vs. $0.6 CAD per hour Moving manufacturing away from Canada Pricing competitors’ brands higher in category of own private labels (thermarest) Developing private brands • Extended lead times in Canadian factories • Less responsiveness to market demands
  • 7. Canadian Market Share By Competitors 0.00% 5.00% 10.00% 15.00% 20.00% 25.00% 30.00% 35.00% 40.00% 45.00% Forzani Total Canadian Tire Walmart MEC Independent Stores Others MARKET PLAYERS Mec is competing in highly fragmented market It enjoys only 1.2% of the total market share
  • 8. Country Of Origin Canada 30% Other 70% PRODUCT ORIGIN Canada Other Most of the products are getting manufactured in Asia because of low cost, labour, manufacturing cost etc.
  • 9. Recommendations Deliver its own product line Focus its Core strengths (company philosophies)- • Ethics • Quality Goods • Competitive prices Refrain from practices like selling competitor’s brands at higher prices Focus and develop Social-media