Described as "strictly an experiment" by Sam Walton when it first opened in 1983, Sam's Club has grown to 715 locations, including 122 in foreign territories. A host of owners of caterers, restaurants, motels, and other small and larger businesses recently gathered at Sam's locations across the country to celebrate the 25th anniversary of the wholesale club concept of Wal-Mart.
One of those thankful small business owners attending was John Wells, owner of Catfish John in Rogers, AK. About 95 percent of what the restaurant buys comes from Sam's.
"I've been using Sam's Club for years, but they really stepped it up about six years ago when they really started bending over backward for small-business owners like myself," Mr. Wells told the Arkansas Democratic Gazette. "I've come to them with supplies I've needed and figured there's no way they're going to be able to do it because I'm too small. But then they come through again and again. They really listen."
Cathy Cronemiller for two decades has picked up everything from diapers and baby wipes to cleaning products and food for her six child care centers in Midwest City, OK. While she used to browse the aisles with a giant cart, Ms. Cronemiller now faxes in her twice-weekly orders and, when she arrives, the items have all been pulled off the shelves and readied for pick up.
Savings continue to keep Ms. Cronemiller coming to Sam's.
"That has remained at from 25 percent and 35 percent cheaper over the years," she says.
In more recent years, pharmacy, optical, photo services, fresh produce, and hundreds of items aimed more at the store's personal customers have been added to the floor space. Yet business owners still account for a little more than half of its members.
"Our focus on business members has been strong over the years, but we also bring value to the individual member," Greg Johnston, executive vice president for operations at Sam's Club, told the Arkansas Democratic Gazzette.
The anniversary comes as the club channel is significantly outperforming other retail channels in the tough economy. In March, U.S. comps rose 3.5 percent at Sam's, 5 percent at Costco, and 6 percent at BJ's Wholesale Club.
George Whalin, president and chief executive officer of Retail Management Consultants and a member of the RetailWire BrainTrust, believers that as gasoline and food prices continue to rise, consumers should gravitate to clubs.
"I think warehouse clubs generally are positioned to do well in the recession," he said.
Discussion Question: What do you think of Sam's strategy for focusing on small business owners? Is Sam's differentiated enough from its main competitor, Costco?