Sam's Club tests new concept

FAYETTEVILLE, Ark.

Wal-Mart’s Sam’s Club has carried out a new store concept that focuses solely on small businesses throughout America. This new club is called ‘Sam’s club business centre’ and will be focusing solely on bulk items required by small businesses. These bulk items may include supplies for offices and food for restaurants, convenience stores, and other enterprises. McMillon, the chief of the Sam’s club states that if the financials (sales) of this new store concept is appealing, they will expand more stores in a similar way to the original Sam’s club (located in Houston) targeting the small businesses throughout America. Sam's Club has been working closely with its small business members, which have been struggling with inflationary pressures on food and fuel.

This new targeting store concept of Wal-Mart has started off well, with 600 stores nationwide, with sales of $43.3 billion in 2007. It seems to me that this is the targeting of a ‘niche’ market. This new concept doesn’t ideally seem to fit the idea of ‘niche’ market because the market of small businesses is not exactly small. However, the original Wal-Mart tried to facilitate everything for everybody, which may be one of the main reasons that brought it failure in Korea. This new strategy is limiting the range of products they are providing but instead are specifically targeting the considerably narrower market of ‘small businesses’, by providing bulk items that other consumers wouldn’t necessarily buy. Therefore, a sort of ‘niche market’ has been formed. Although financials may have been good in America, it cannot be made certain that the same strategy would work in Korea, because small businesses already have channels of providers, and there is 정 (attachment, loyalty) that Koreans live by. It would be hard for Wal-Mart to find its niche market.

Sam's Club tests new concept'

Businss Week

The Associated Press

FAYETTEVILLE, Ark

June 5, 2008