The Sounders were beaten just once in their past 12 outings before the Rapids threw them around at Dick's Sporting Goods Park in a performance that thoroughly disappointed Schmid.
"At the end of the day we have to learn that that's not good enough," he said.
"You can't walk on the field and assume that you're going to be in the game. You have to be in the game mentally right from the beginning of the game."
Schmid also suggested that it was a bit of a morale-denting defeat just a handful of games out from the playoffs.
"No, it's good to get your ass kicked at this time of the year, just to remind you that this is the real thing and if you don't come out completely prepared mentally and ready to give everything you have, you're going to get your ass kicked," he added.
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