Dozens of Sam’s Clubs closing
Walmart also says it’s raising workers’ pay.
Sam’s Club, the membership warehouse owned by retail giant Walmart, is shutting down or converting 63 stores.
The company attributed the decision to the need to better fulfill online orders, less population growth than expected in some markets and competing locations.
The Sam’s Club closures were confirmed the same day Walmart said it would lift the hourly minimum wage in the U.S. to $11 and give out bonuses of up to $1,000.
Of the Sam’s Club locations, about 50 will be going out of business for good. Roughly 10 of those locations are closing their doors as of Thursday, while the remainder will be shuttered over the next three to four weeks.
About 10 to 12 of the stores are slated to be closed temporarily as the retailer converts them to regional distributional centers to help fulfill online purchases. Workers previously employed at those sites are not guaranteed one of the new positions.
In a note to staff, Sam’s Club President and CEO John Furner said that a review found stores that were hindering business at other locations or operating in areas that had not seen the population growth that was expected.
“We’ve decided to right-size our fleet and better align our locations with our strategy,” he wrote. “We will be closing some clubs, and we notified them today. We’ll convert some of them into eCommerce fulfillment centers — to better serve the growing number of members shopping with us online and continue scaling the SamsClub.com business.”
News of the closures began to slowly trickle out Thursday. Notices filed with the Indiana Department of Workforce Development revealed that three Sam’s Club stores in Indiana would be shutting down, while news outlets across the U.S. began reporting possible closures in cities from Memphis to Atlanta to Houston.
The company would not provide a list of the specific locations that will be closed or the number of employees that would be impacted, but public filings examined by USA TODAY revealed that at least 3,802 workers will be affected.
Furner said the company would try “to place as many associates as possible in new roles at nearby locations.”
The retail landscape has been upended by the rise of Amazon and the growing shift by consumers to shopping online. Though warehouse-based retailers such as Sam’s Club and Costco have a steady revenue stream fueled by member fees, they are also having to adjust to an environment in which customers can buy groceries, electronics and other products from a growing array of e-commerce and stores.