Recreational Equipment Inc (REI) is exiting its experiences business, citing the need for a sustainable economic model.
“Earlier this morning we shared with our experiences team that after a thorough review and careful consideration, I have made the difficult decision to exit the experiences business altogether, effective this week,” said Eric Artz, president and CEO of REI.
“The reality is a thriving co-op requires a sustainable economic model that is capable of investing at the appropriate level to fully fund our most critical strategic ambitions.”
Artz noted that REI’s experiences business served 40,000 customers last year, accounting for only 0.4 per cent of the retailer’s customers.
“We’ve held out as long as possible, but the fact remains that experiences is an unprofitable business for the co-op, and we must adjust course,” said Artz.
The decision will result in the layoff of 180 full-time employees and 248 part-time guides.
The co-op will provide regular salaries to terminated full-time employees through March 9, with their benefits to remain active until the end of March.
Part-time employees will remain benefits-eligible through January, while shared employees will discuss with their store manager to explore other available options to continue employment. Severance pay will be given to all terminated workers.
Last year, REI revealed plans to open 10 more locations, with two already announced for next year, including Durango (Colorado) and St George (Utah).