REI CEO addresses union boycott and long-term financial sustainability

REI is currently engaged in labor negotiations with unions, a process that earlier in the year prompted union members to request a boycott of the company's sale. Approximately 70,000 co-op members participated in the boycott. CEO Mary Beth Lawton characterized the situation as difficult and emotional, noting that the action was counterintuitive because a successful sale would generate higher bonuses for employees. Lawton highlighted the unique pressures inherent in REI's structure as the largest consumer co-op in the U.S., which serves 26 million members who pay a $30 lifetime fee and receive a 10% dividend on purchases. Unlike publicly traded companies, REI does not have shareholders or quarterly earnings calls, a structure that allows for a focus on long-term sustainable growth rather than short-term profit. However, Lawton acknowledged that the co-op model still requires profitability and cash flow to sustain its mission, creating a complex balance between serving member interests and maintaining business health. The company is working to turn around profitability issues that have persisted for several years. Lawton maintains that the co-op structure allows for long-term strategic planning but requires strict financial discipline to ensure the company's longevity. She stated that the biggest thing at stake is making sure the company can be around for another 88 years.