REI is healthy and growing and it uses a very different business model than its competitors. This company is a customer cooperative, which means that of the $2.2 billion it sold in outdoor equipment and services last year (up 9.9% from 2013), some $168 million will go back to its members as annual dividends. Its members are its active customers - that's who gets that profit.
REI climbs to new heights with record sales
(The Seattle Times)
I know a number of people who work at REI since I live in Seattle, which is the company's hometown. What I find when I talk to them is the sense that they genuinely like the company, and that it's really good about investing in its people and its systems. In short, it invests in itself and the extended network of stakeholders on whom its success is dependent over the long-run...even if those stakeholders aren't just the people, but the environment (or the "outdoors") itself.
As REI CEO, Jerry Stritzke, puts it “We aim for steady growth so that we can invest in the outdoors.” These aren't just meaningless words either. I used to run a consulting group that specialized in serving environmental organizations, and I witnessed firsthand REI's dedication to helping these groups with their mission - a shared mission. To that point, REI is plowing $5.7 million of its 2014 profits back into these nonprofit partnerships. It sees them as "investments."
In this sense, REI is a classic example of what I call a "regenerative business." You can learn more about what I mean by that here:
What is Regenerative Business?
I'm not saying REI is perfect; of course, they're not. But if someone tries to tell you there's no alternative to business-as-usual approaches to business, well, now you have a great example of why that's not true. ;)
#goodbusiness #stakeholder #rei
- SingerSCPM.comMgmt Consulting & Project Mgmt, present
Extensive experience with 501(c)(3), (4), (5) and (6) organizations in paid and volunteer capacities. Serves on and with boards of directors, with executive management, conducts pro bono consultations for Taproot Foundation and volunteer management for a state-level chapter of a national organization.
- SDSU and Stanford
- San Diego State University
- Stanford University
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