sam's club can soar but cannot drift. membership stores are expanding across the country, but negative topics are frequently trending on the internet.
2024-09-08
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our reporter li xuanzi reports from changsha
the slogan "sam's club, providing you with a worry-free shopping experience" has made many people familiar with it and signed up for membership. however, sam's club has been in a bit of a mess recently. negative topics have frequently appeared on weibo's hot searches, and sam's club, which has been caught in the vortex of public opinion, has caused many netizens to wonder: "what's wrong with sam's club recently?"
however, parent company walmart is ushering in a golden age in the chinese market thanks to sam's club. walmart china's net sales in the second quarter of this year reached us$4.6 billion (approximately rmb 32.5 billion).
sam's club has been repeatedly punished
in fact, in recent years, sam's club has been punished at least 20 times for false advertising and selling problematic food. from 2015 to 2018, dalian sam's club was punished at least six times by local market supervision departments for false advertising, food mold, product adulteration and other issues. among them, it was fined 50,000 yuan for selling a certain brand of bean curd sticks that were moldy and infested with insects.
on february 6 this year, the shanghai municipal market supervision administration fined shanghai zhenru sam's club co., ltd. more than 8,870 yuan for producing and selling unqualified products as qualified products, and ordered it to stop the illegal activities.
some consumers found foreign objects in the pork jerky they bought at sam's club, and hair in the unopened products... some consumers also posted complaints on the black cat complaint platform.
"sam's club's food safety problems are at an explosive level because the hidden dangers have accumulated for too long and have entered every link of its industrial chain." industry analyst zhang shule said that for any large supermarket chain, the wider the chain, the more consumers, and the more complex the product categories, the greater the food safety risks. in addition, sam's club has been expanding at a very fast speed in recent years, which inevitably leads to various management lags, thus forming a concentrated outbreak of hidden dangers.
he pointed out that from the perspective of communication, when a food safety issue has a great exposure, it often leads to more consumers taking the initiative to expose some consumption "accidents". on the contrary, when some food safety issues occur in daily life, the herd mentality caused by the brand reputation suppresses consumers' desire to expose, until the accident of "hot search" occurs and detonates the "problem bomb" that was previously buried under the ice.
closing stores and opening new ones
despite frequent food safety incidents, sam's club is still in the "boom" of the market and even became the "hope of the whole village" of walmart.
in recent years, with the continuous changes in the consumer market and consumer demand, the hypermarket format has gradually declined, and the "supermarket giant" walmart has not been spared. according to lianshang.com data, in the first half of this year alone, walmart has closed 16 hypermarkets.
its sam's club is "soaring" all the way. some people in the retail industry speculate that sam's sales compound growth rate in the past three years is no less than 30%, and sales will exceed 80 billion yuan in 2023. the average annual contribution of a single user is 14,000 yuan, which is 1.6 times that of taobao.
as of august 31, sam's club has opened 49 stores across the country, mainly concentrated in cities with rapid economic development, including beijing, shanghai, shenzhen, guangzhou, changsha, dalian and hangzhou. in addition, sam's club has more than 5 million paying members, with an average annual consumption of 13,000 yuan per member.
it can be said that the current sam's club has become the "backbone" of walmart in the chinese market.
the ever-expanding sam's club also accelerated walmart's performance growth. judging from walmart's global revenue performance, the data related to sam's club has a relatively high growth rate. according to the financial report released by walmart, walmart china's net sales in q2 of fiscal year 2025 (may 1 to july 31) were us$4.6 billion, a year-on-year increase of 17.7%, comparable sales increased by 13.8%, and e-commerce net sales increased by 23%. according to it, sam's format and e-commerce business continued to perform strongly in the second quarter.
among them, membership fees and other income in q2 of fiscal year 2025 increased by 16.0% year-on-year. this data is obviously related to sam's club, which collects membership fees.
with the impressive performance of sam's club, walmart publicly stated last year that it expects to open 6 to 7 new sam's club stores every year in the future, and that the number of sam's stores is expected to exceed 60 by 2026.
who is the next "chinese sam"?
at the same time, walmart is continuing to "increase its stake" in sam's club. recently, according to the latest documents walmart submitted to regulators, walmart has completed the sale of all of its jd.com shares, with a total value of approximately us$3.7 billion.
a walmart official said: "this decision allows us to better focus on the strong development of china, including the operation of walmart shopping malls and sam's club, and allocate assets to other priorities. we will continue to provide high-quality services to customers and members in china and around the world."
data shows that sam's club china's online sales increased by 29% year-on-year in the first half of 2024, accounting for about 50% of total sales, while the penetration rate of walmart china's entire e-commerce has reached 48%.
however, walmart still faces competitors such as costco and hema in the chinese market. many "new players" are also eager to try the membership store track. for example, dongfang zhenxuan has previously announced the idea of entering the offline membership store track and stated that it wants to benchmark sam's club.
in this case, if food safety incidents continue to occur, sam's so-called halo of "the first choice for the middle class" will fade, and it may even face growth difficulties.
zhang shule said that the outbreak of food safety issues is a warning to sam's club, which can cool down its overheated channel expansion. for sam's club, it is an opportunity to focus on correcting mistakes and avoid the accumulation of hidden dangers that will directly subvert the brand image.
