threats. It is important to
note that opportunities and threats are things that the company cannot cause or
stopped by the company. In preparing a SWOT analysis for Sam’s Club I am
considering the powerhouse monopoly it is. The Sam’s Club Company has a
very extensive SWOT analysis. The
company’s strengths, weaknesses, opportunities, and threats are what both hold
the company back, and keep them motivated and excelling at the same time. Sam’s
Club has many strengths. Sam’s Club is a
dominate companying in selling bundles to products to small business and
individual customers. They are the 8th largest retailer in the U.S. by annual
net sales. Bring in about 56 billion dollars per year. With 621 Clubs in the
U.S. and Puerto Rico and has over 47 million members. Having this many Clubs
helps give jobs to many people.
Club has lots of strengths just do to the size of the company. Sam’s Club is
different to other stores mostly because it sells products in bundles and at
reasonable prices. This allows families to shop for product that they can have
for a long time and not have to shop every week. Also they can sell products to
small businesses that need a lot of products consistently.
strength is that Sam’s Club is a branch off of Wal-Mart. Because of this, some products are similar to
what are sold between the two companies. This is a strength because customers
that want products at Wal-Mart can get a bigger bundle of them from Sam’s Club.
They also sell a wide variety of merchandise from crystals and collectables,
jewelry, apparel, floral, designer goods, meat and other food items. Sam’s
Clubs also has membership card where you can save money on good. When you’re a
member you of Sam’s Club you can go into any other Sam’s Club location with
your membership card.
An additional strength that Sam’s
Club possesses is their wide range and selections of products. Sam’s club has done an excellent job in
making sure that every individual’s needs are met through the products that are
provided on the shelves. There are a
variety on named brands, aside from it are “Greater Value” or Walmart brands,
and there are even variations of that.
There are vegetarian, gluten free, and reduced sodium in many
products. Sam’s Club, knowing that their
main customers are business owners, makes sure that customers have the products
needed, even if it means going the extra step in ordering it to the store or
the front door of the business.
every strength there are weaknesses.
Sam’s Club has many issues with employees including lawsuits and a high
turnover rate. According to Forbes
Magazine, associates work an average of 28 to 40 hour weeks Associates work an average of 28 to 40 hour
weeks with a take home pay of only $250.00 a week. The average family with the bread winner
working as an associate at Sam’s Club is below the poverty line. One third of the associates’ children qualify
for a free lunch. They are limited to
only 28 hours a week due to the fact that they are considered part time. This poses as an issue they do not qualify
for benefits (PBS, 2013). Another
weakness is that the Wal Mart Company does not have unions. This poses an issue
because when employee’s needs are not met, they have no one to turn to with
their best interest. They only have
managers and high up executives (PBS, 2013).
Another weakness is the lack of time
off and the high turnover rate.
Associates are required to work Thanksgiving, Black Friday, Christmas,
and any other American recognized holidays.
Because of this, and other issues with employee retention, The Wal Mart
Company’s associates held strikes and even quit. On November 26, 2013, in Washington D.C.
Walmart workers held a strike before Thanksgiving. The workers did not feel they should have to
work on Thanksgiving. This was televised
on major news outlets and went nationwide. Walmart Company has a 70% turnover
rate. (Politics USA, 2013).
Sam’s Club has many major opportunities. Sam’s Club has taken its potential
opportunities well. They have expanded immensely in the past. By opening their
own gas stations, this has allowed their current members to normally get better
discounted gas prices over normal gas stations. Sam’s Club also introduced
pharmacies inside their own stores. This saved their customers time, money and
allowed them to shop for pharmaceutical needs at one location instead of
traveling to another store like Walgreens. This made it much more convenient,
and allowed their members to get all of their needs met through one store. One
of Sam’s Club biggest expansions was the launch of their own website and Click
& Pull. By providing this it allowed their customers the ability to search,
wish-list (save items for a later date), and buy all at their fingertips. They can
buy whatever they need at home, the office or now on the go with the release of
smartphones. With Click & Pull, members are able to purchase items online
by five P.M. and pick their item(s) up at a store the very next day. This makes
shopping a lot easier and allows their members to skip the hassle of shopping
at a store. They can find their product online, purchase it and then pick it up
next day. They even went a step further by providing a smart phone application.
This can be downloaded for free via Android or Apple’s App store. This removes
the need of using a web browser and makes it easier to search for items. The
app helps members shop smart and save even more on a mobile device. While using
the app, you can manage your membership, order whatever items needed, use club
mode, and even check out faster with Scan & Go. As Sam’s Club grows, they
have continued to expand their mega stores around the globe. However, they are
only located in four countries outside the U.S., China, Brazil, Mexico and
Puerto Rico. They could open up major markets by putting locations in Europe.
London, Paris, Berlin, Rome, and Amsterdam all seem like strong contenders for
a Sam’s Club location. They should take advantage before a competitor like BJ’s
or Costco begins to dominate in these relatively untapped markets.
Sam’s Club is one of the most
dominate wholesale companies in the industry. They have continued to provide
excellent products at great prices. Their membership has continued to
skyrocket. They have really stuck to their owner’s view that you can always strive
to do better. For the short term they are very well off. As long as they stick
to what they have proven is successful they will always be a force in the
wholesale industry. However, in the long run they will need to make sure they
are prepared for the opportunities of advances in technology, adaptation to new
and prosperous small businesses, ability to supply all new equipment, products
and services these new organizations, customers, and small businesses need to
Last but not least, Sam’s Club’s threats are
extensive. As much as one would like to
believe that things can be perfect in a business if it succeeds well, this is
not the case. Sam’s Club requires membership in order to shop at their stores
however if not many people are members or would like to pay a large member fee,
the amount of consumer traffic they usually pull in will decline unlike other
department stores where products are offered to everyone. There are not many
Sam’s Club stores in the same area while it is fairly easy to find Wal-Marts in
closer proximity. Although Sam’s Club is international, there are only a couple
of stores outside of the U.S. They are located in China, Brazil, Mexico and
Puerto Rico and there is only one in each country. Sam’s Club’s biggest
competitors are BJ’s and Costco and both have seen growth in their locations
across America whereas Sam’s Club has remained at the same number of stores for
quite some time. The true issue is that Sam’s Club is a subsidiary of Wal-Mart
and the focus seems to be that more Walmarts should be built instead of Sam’s
Club stores. Also, due to the economic crisis, more and more small businesses
close or go out of business each day and since small businesses are Sam’s
Club’s primary customers they will eventually see a decline in sales (History
of Sam’s Club, 2012).
In closing, Sam’s Club is a company
with a lot to offer. Not only is it
growing in size, but in employees, and the products they offer. We believe that as a company, if they continue
to mistreat their employees, eventually, they will find somewhere else to
work. A company cannot run without its
employees. They are undoubtedly, the
backbone of the company. A consumer can
find the same product somewhere else, but without workers, the machine that is
the business will not run. The fact the
there is a 70% turnover rate with the company is a huge indicator that the
company does not take care of the employees.
Employee relations are very important in any business, and without it,
employees are unhappy. If this is the
case, quality work will not get done. If guests are not happy with the customer
service and product, he/she can always go to a competitor for the same product.