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REI dividend

Posted: Thu Feb 25, 2021 1:28 pm
by rperth
Each year, REI Co-op members receive a unique benefit—the REI member dividend—which is your share of REI’s profits of the last year. Since we didn’t earn a profit in 2020, we don’t have those profits to provide to members in the form of a dividend. Even though we didn’t make a profit last year, you’ll receive a member reward equivalent to what your dividend would have been: 10% back on your eligible full-price purchases in 2020. This will feel a lot like the dividend experience you’re used to, and you’ll see your total reward in your account on March 1.

I got this email today. So, we are getting a dividend but they are calling it a reward?

Re: REI dividend

Posted: Thu Feb 25, 2021 1:36 pm
by ker0uac
Yea I was confused by that paragraph too. I think for members there's no difference, but there might be one for taxes.

Re: REI dividend

Posted: Thu Feb 25, 2021 1:44 pm
by markf
This year's member reward can't be turned in for cash like the regular dividend, and it expires at the end of this year instead of the end of the year after it was issued. Not much difference for most people, but legally yes, there is a difference.

Re: REI dividend

Posted: Thu Feb 25, 2021 1:51 pm
by rperth
markf wrote:
Thu Feb 25, 2021 1:44 pm
This year's member reward can't be turned in for cash like the regular dividend, and it expires at the end of this year instead of the end of the year after it was issued. Not much difference for most people, but legally yes, there is a difference.

Thanks Mark, that makes sense. TBH, for 25 years I did not know you could turn it in for cash. So, it won’t make any difference to me.

Re: REI dividend

Posted: Thu Feb 25, 2021 2:34 pm
by Gene913
Because the coop did not turn a profit this year, there is no cash available to pay a "cash" dividend.
Unlike our government, the coop cannot simply print money. If there are no profits, there can be no cash dividends.
So instead of giving coop members a cash dividend, they are giving coop members a "reward" in the same amount they would have received if dividends were issued.
The reward is the same as cash when you buy something at REI. So your reward spends just like cash as REI, but it cannot be spent anywhere else.

Re: REI dividend

Posted: Thu Feb 25, 2021 2:39 pm
by Gene913
ker0uac wrote:
Thu Feb 25, 2021 1:36 pm
I think for members there's no difference, but there might be one for taxes.
no tax difference for members. there is an accounting difference for the coop. the coop cannot pay a cash dividend if there are no profits from which dividends are paid.
but the coop can give the cash equivalent of the dividend to members in the form of a "reward" that can only be spent at the coop.
essentially the coop's books are paying the 2020 dividend by discounting prices for members in 2021.

Re: REI dividend

Posted: Thu Feb 25, 2021 2:48 pm
by bergsteigen
Gene913 wrote:
Thu Feb 25, 2021 2:34 pm
The reward is the same as cash when you buy something at REI. So your reward spends just like cash as REI, but it cannot be spent anywhere else.
Except that you don’t get rewards for next year on purchases with the dividend. Hence why I always get the cash. Oh well. Maybe next year.

Re: REI dividend

Posted: Thu Feb 25, 2021 2:59 pm
by Scott P
bergsteigen wrote:
Thu Feb 25, 2021 2:48 pm
Except that you don’t get rewards for next year on purchases with the dividend.
True, but you also get 20% off an item when you use your dividend.

Re: REI dividend

Posted: Thu Feb 25, 2021 3:06 pm
by ker0uac
Scott P wrote:
Thu Feb 25, 2021 2:59 pm
bergsteigen wrote:
Thu Feb 25, 2021 2:48 pm
Except that you don’t get rewards for next year on purchases with the dividend.
True, but you also get 20% off an item when you use your dividend.
Are you referring to the member coupons? You can always get the 20% off.

Re: REI dividend

Posted: Thu Feb 25, 2021 3:15 pm
by Gene913
bergsteigen wrote:
Thu Feb 25, 2021 2:48 pm
Gene913 wrote:
Thu Feb 25, 2021 2:34 pm
The reward is the same as cash when you buy something at REI. So your reward spends just like cash as REI, but it cannot be spent anywhere else.
Except that you don’t get rewards for next year on purchases with the dividend. Hence why I always get the cash. Oh well. Maybe next year.
you're right, and I get it. Most people do not convert their dividend into cash and simply use it as a "credit" when they buy more stuff at the coop. For those people, who are the vast majority of coop members, there will be no difference between the normal "dividend" and this year's "reward." The coop does not have the cash to pay a dividend this year, but they are trying to do something. Chalk it up to more COVID-related collateral damage. As you say, Otina, hopefully 2021 will be better and, dare I say it, back to normal??

Re: REI dividend

Posted: Thu Feb 25, 2021 3:21 pm
by SkaredShtles
I think I'll go buy a package of fire-starter with my $3.28 dividend.

:mrgreen:

Re: REI dividend

Posted: Thu Feb 25, 2021 3:34 pm
by ker0uac
Well if your dividend is high then you are buying way too much at full price