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In Expansion Push, Sam’s Club Plans Over 30 New Stores, Five New Distribution Centers

Unit’s New Locations Will Be Bigger, With Dedicated Space for Curbside Pickup

Photo Courtesy of RCP.

Retailer Sam's Club plans to open more than 30 new stores over the next few years and five new distribution centers, expansions it said are being driven by the chain's record growth.

The company, a division of Bentonville, Arkansas-based Walmart, on Thursday said its first new store is planned for Florida and is slated to open next year. Sam's Club is also undertaking a multiyear plan to invest in and modernize its supply chain through new distribution and fulfillment center locations across the country, incorporating cutting-edge automation. The retailer's first new logistics facility is planned for Georgia in the third quarter, according to the company, which is headquartered in the same city as its giant parent. Four more will also launch in 2023, the company said.

"The decision to invest in expanding its physical footprint was motivated by historic comparable sales growth, and a record rise in membership over the last two years," according to a Sam's Club statement.

"As we open new clubs in new locations, we’ll continue to innovate so that our members shop and save whether in person or online," Sam's Club CEO Kathryn McLay said in the statement.

The retailer didn't immediately respond to an email asking exactly where the first new store and distribution site will be opened.

Sam's Club, which said it has been redesigning the majority of its 600 stores, faces a tough and dominant competitor in Costco Wholesale, the Issaquah, Washington-based chain. It has 847 warehouse club stores overall, including 583 in the United States and Puerto Rico and the remainder in nations around the world. BJ's Wholesale Club, based in Marborough, Massachusetts, is third in terms of store count, with 235 U.S. locations.

Big-box warehouse club retailers have fared well in an era of record inflation, when shoppers are pinching pennies to stretch their grocery budgets. In the third quarter, Sam’s Club comparable sales increased 10% and membership income rose 8%, with member count reaching an all-time high. Now Sam's Club is attempting to step up its game with its new-store design, offering more options for consumers and better accommodating online sales.

Sam's Club hasn't opened a new store in years, not since 2017, and closed about 60 of them in 2018, transforming a few into online fulfillment centers, according to CNBC.

The new Sam's Club stores will be about 160,000 square feet, larger than most current locations, according to the company. Most new clubs will also feature a seafood-sushi island, full-service floral services, and walk-in dairy and fresh coolers. And like a number of its fellow retailers, Sam's Club will be doing more in terms of its healthcare offerings.

"Members will benefit from a larger healthcare space inclusive of a patient waiting area, health services suites, private consultation rooms and dedicated hearing and optical centers," Sam's Club said in its statement. Many of the new locations will also include fuel stations and liquor offerings.

To handle its online orders, Sam's Club said it will be significantly expanding its "omni-fulfillment footprint allowing for a dedicated space for curbside pickup, delivery-to-home and ship-from-club orders." That area will include walk-in coolers and expanded doors for outgoing delivery truck efficiency.

Over the past several years Sam's Club has already invested significantly in upgrading its stores, making them brighter and easier to navigate, according to the company.

The chain, to support its growth and expanded omnichannel options for consumers, over the next several years said it will add "numerous new facilities" to its supply chain network as well as retrofitting a number of existing facilities.

"We have an opportunity to place ourselves on the cutting edge of efficiency and automation, unique to our business model," Joseph Godsey, senior vice president of supply chain at Sam's Club, said in a statement.

As part of this initiative, Sam's Club said it is launching highly automated facilities with state-of-the-art automation and robotics, adding that with its investment its supply-chain locations will be much closer to its stores and customers.

Source: 2023 CoStar News.

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