EVERGREEN PARK, Ill. --- Even though more than a week remains in the month, April has already been a very busy month for Sam's Club. And if marketing plans for the rest of the year are as effective as company execs expect, the aisles of Sam's Club stores will be teeming with convenience retailers trolling for low-priced beverages, snacks and other c-store staples with which to fill their own stores' shelves.
This week, otherwise known as National Small Business Week, Sam's Club is partnering with the National Federation of Independent Business (NFIB), Washington, D.C., and SBTV.com. The [image-nocss] partners have crafted a promotion in which Sam's Club business members—many of which are independent c-store owners—can win a $100,000 "makeover" that includes $25,000 in cash, merchandise and supplies, as well as mentoring from SBTV.com business experts and a lifetime NFIB membership.
"I shop at Sam's Club, usually this one [in Evergreen Park, Ill.], almost every day—at least twice a week," Tony Zakhem told CSP Daily News. "I get everything I need for the office, for my home and for myself.… Usually I'm in here every Friday, getting ready for what's going to happen the next week."
Some 14 years ago, Zakhem ran a Mobil gas station in Evanston, Ill., and shopped Sam's Club for lower-priced c-store staples. His business interests have change dramatically since then; he now runs a homecare-supply company in Chicago. Whereas he used to shop warehouse clubs for candy, oil and antifreeze, a typical purchase these days consists of diapers.
But one thing, he said, hasn't changed: "It's very convenient. And the price is right."
Basement-low prices are the main reason retailers shop warehouse-club stores such as Sam's Club and Costco. Warehouse clubs stock an ample representation of merchandise in multiple c-store categories, from tobacco to health-and-beauty-care (HBC) items. But even company officials from warehouse club chains admit their assortment does not match up to those of traditional wholesale suppliers such as McLane Co. and Eby-Brown.
More than 20 Sam's Club stores populate the greater Chicago market, according to Sam's Club market manager Larry Dodson, who oversees 11 Sam's Clubs from Rolling Meadows, Ill., to the Indiana border. It is not uncommon for retailers to travel as far as 30 miles to their local club store, he said. Furthermore, some members shop at as many as three different club stores, depending on their size and the variety of merchandise offered.
At the Evergreen Park store, more than 47% of sales come from small businesses, up from 42% last year, according to the store's general manager, Wayne Brock. Most of the purchases made by c-store owners in this store are in janitorial items, HBC items, packaged beverages and candy. Collectively, c-store owners represent Sam's Club's largest sector of business members, said Brock.
Like all Sam's Club stores, the one in Evergreen Park gives business members the option of placing their orders by Web or fax. Members pick up their orders the next day at the front of the store so they don't have to fight aisle traffic. Chicago retailers in general tend to roam the store so they can "touch and see" new merchandise, according to Dodson.
"Our whole model is geared toward finding out what small-business owners want and trying to do it better for them," Dodson told CSP Daily News. "They want consistency in their products. … If it's a school or a church and they want milk, they'll want the same brand all the time. If it's a caterer, they want to make sure we have the same cheesecake, in the same 12 pieces, with the same consistency. There's comfort in that."
Retailers pay an annual fee to become Sam's Club members. The company's standard Business membership costs $35 per year, according to the Sam's Club Web site; Business Plus membership, which provides members with access to additional amenities and conveniences, costs $100 per year.
In a recent survey of 2,500 Sam's Club business members, 37% estimated they save more than $1,000 per year by shopping at Sam's Club. Approximately 70% said they make up their annual membership fee on their purchases every month. Savings in a tight economy have been the primary lure to attract small-business owners, but company officials also alluded to upcoming summer events and other value-added services that should further attract retailers to the Sam's Club fold.
Sam's Club, a division of Bentonville, Ark.-based Wal-Mart Stores Inc., celebrates its 25th anniversary this month, having opened its first location in Midwest City, Okla., on April 7, 1983. Today Sam's Club has nearly 600 locations, including more than 430 with fuel stations, nationwide.Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.