Bikes at MEC, is this a Good Thing?

I was speaking with some staff at a bike shop a few days ago and noticed that there was a petition regarding a provincial sales tax that bike shops have to pay. I didn’t spend much time discussing the details. As far as I can tell, MEC in BC may have two advantages over other local bike shops. First, I was told that the bike shops in BC have to pay a sales tax, and these monies are earmarked for cycling infrastructure in the city. Since MEC is a cooperative, they supposedly do not have to pay this tax. Secondly, because MEC is a cooperative they get patronage dividends, and this supposedly helps their bottom line.

There is a real worry that the local bike shops will lose business to MEC, and that this is unfair primarily because of the provincial tax break. I can only imagine how The Bike Doctor is being affected by MEC’s new bike retailing. MEC’s bikes are directly competing with what I see as the new core business model of bike shops in the lower mainland. Their target market is the commuter and casual but interested cyclist wanting a decent bike in the $600 to $1500 range. I believe this is the strongest market group in North America now. My opinion is that MEC is not actually offering anything that is not readily available at other bike shops. I recently compared two bike models, an internal geared hub commuter and a cyclocross, with other offerings in the city. Contrary to what a person might think, I did not see any price advantage or design advantage in the MEC bikes. In fact, I identified models from local bike shops that were better deals. However, it is easy to see and understand that MEC will still retain a large portion of the market because of their size and popularity. I’ve read that MEC wants to provide bikes that aren’t readily available to the public, but this is simply not the case in the lower mainland. I’ve read A LOT on the web where people are already saying they will buy their next bike at MEC because they don’t want to overpay for something that is inferior! Call me sentimental, but I hate to think that a local bike shop will lose a sale to MEC on a bike that is 10% more expensive and slightly lower in quality.

For an idea on who might be affected by MEC’s bike sales, click this link.

There seems to be a good discussion on Cycling in Ottawa about MEC’s bike business. Much of the discussion mentions the patronage dividend, but I think the more important issue in BC is the sales tax.

Personally, I’ve been becoming more and more disillusioned with MEC in recent years. I clearly remember why I thought MEC was the cat’s meow back in 1990. Back then I could purchase a goretex jacket, a backpack and bike panniers for less than 50% of what I’d pay at other shops. The reason I could do this is because MEC was making their own stuff or getting stuff from Serratus, and the gear was cheaper than expensive brand-name boutique stuff that was available in other shops. It was a win-win. I didn’t need fancy gear and I didn’t have much money. Since then I’ve seen that MEC is carrying less and less of the no-name gear and more and more of the boutique gear (think Patagonia). I don’t think this is any real fault of MEC, it is likely a by-product of China’s dominance in manufacturing and how most gear manufacturers are getting their goods made in China. In other words, the playing field has leveled.

In terms of bikes, I don’t buy MEC’s mantra of ethical purchasing. As I understand it, there are about 4 manufacturers of bike frames in the world. Everyone gets their bikes made in one of these four factories, including MEC. If MEC really wanted to be ethical, they would get DeKerf to make frames for them! I doubt that MEC gets to survey the bike manufacturers, it’s my understanding that they are locked up tighter than Fort Knox.

Anyways, these are just some of the issues involved with MEC selling bikes, as I understand it. I welcome any corrections or comments on this topic!

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