SAM’S CLUB WANTS TO GO UPSCALE…?

I learned a fact about Walmart today that I never knew before: households earning $45,000 a year are the Bentonvile Behemoths sweet spot. Not coincidentally, I'm sure, the most recent figure (2013) for the median household income in the Unites States s $51,939. So, Walmart wants to low-ball the median by just a skosh. Sam's Club has decided that that figure is simply to low to attract the needed customer necessary for growth and enhanced profitability. Sam's Club needs to be, well, less Walmart (and more like Costco). Sarah Nassauer, writing for The Wall Street Journal in Sam’s Club Aims to Be Less Like Wal-Mart explains:
After struggling for years to turn around sluggish sales, Sam’s Club is now pursuing a more fundamental fix: breaking away from the low-income consumers who shop at its parent, Wal-Mart Stores Inc. “We want to be less of a Wal-Mart,” said Rosalind Brewer, chief executive of the warehouse-club retailer that has tried more modest moves like improving online ordering and adding such services as tax preparation that appeal to small-business members. The new strategy means carrying fewer products that appeal to households that earn $45,000 a year—Wal-Mart’s sweet spot—in favor of targeting wealthier shoppers with more organic food, brand-name clothes and 1,000-thread count Egyptian cotton sheets, she said during a recent interview. Sam’s struggle to shake an early focus on mainstream consumers has become a liability as club stores have evolved into a favorite among more affluent shoppers who are able to pay a membership fee for access to discounts on items from large screen TVs to bulk boxes of peaches. At the same time, big- box retailers and grocery stores have embraced discounted bulk sizes, without a membership fee. Rival Costco Wholesale Corp. has thrived, building stores in wealthy enclaves and delivering strong annual sales gains.
Do you know anyone who would buy 1,000-thread count Egyptian cotton sheets at Sam's Club? Me neither. Jeff Hess: Have Coffee Will Write.

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