Outdoor and fitness gear chain REI is bucking the Black Friday retail trend by closing its door for business on the day that brings other retailers hordes of bargain hunting customers.
Black Friday may have become one of the biggest shopping days of the retail year but according to REI CEO Jerry Stritzke, it's not worth it.
"We think that Black Friday has gotten out of hand,"he says.
Stritzke will be be giving his 12,000 full and part-time workers Black Friday off, with full pay. His workers will also get to have another big retail day off - Thanksgiving.
Although the company's online store, which accounts for 20 percent of its total sales, will remain open for business, Stritzke says the company will not be stepping up efforts to lure Black Friday shoppers in that way. He says customers will still be able to place orders through the website but the homepage will display a "cover screen” that will encourage customers to explore the outdoors instead.
Over recent years, Black Friday has become one of the company’s biggest sales days. Stritzke acknowledges that keeping REI's 143 U.S. stores closed will put a dent in revenue, but he says because of the company’s business model, he isn't worried that its strategy could be too costly. REI is a "consumer co-op" where member customers pay a one-time joining fee and receive an annual dividend -- usually equal to about 10% of their purchases for the year.
The company has 5.5 million members, making it the nation’s biggest retail co-op, with members accounting for about 90% of the company's sales. Stritzke says "keeping their loyalty means focusing on what they care about".
"This business centers on the outdoors," he says. "Thus, we can do something like close our doors on Black Friday, and we'll have the membership that'll think that's cool."
Stritzke says it's of more value to REI to bring in “new, passionate members” than to compete for holiday bargain hunters.
"You need people to go to the mountain, you need people to catch that outdoor bug," he says.
Members who already have the bug have brought REI two years of double-digit growth.