Sam’s Club earns Q3 bragging rights
Sam’s Club was Walmart’s best performing division during the third quarter and holiday plans outlined by president and CEO Rosalind Brewer suggest that could be the case in the fourth quarter as well.
Same store sales at Sam’s increased 1.1% and total sales increased 2.1% to $12.4 billion a while with traffic was up among both business and individual members. Operating profit increased 9.2% to $474 million.
Leading the way were categories such as home and apparel and health and wellness which logged mid single digit comp growth. Low single digit growth was seen in fresh, freezer, cooler, grocery, beverage and consumables. The laggard was the technology and entertainment area which registed a mid single digit comp decline.
Looking forward, Brewer said Sam’s would be driving sales in the fourth quarter by investing in price and providing members a robust treasure hunt experience.
“First, our members will be rewarded with two Instant Savings books and an exclusive VIP event for our Plus members the Sunday before Thanksgiving,” Brewer said. “Second, we’ve collaborated with the Global eCommerce team to provide the best online program we’ve ever had. Finally, in December alone, we will transition our club three times, providing members with more than double the number of new general merchandise items versus last year.”
The holiday merchandise should be very interesting this year as Brewer said Sam’s merchants have been empowered to take more calculated risks.
“Their focus on newness and excitement has transformed our merchandise assortment,” Brewer said.
Even with the positive developments outlined by Brewer, the spending climate remains challenging and investments in price hindered top line growth and apparently will continue to do such judging from the range of same store sales possibilities she envision for the fourth quarter. Comps are expected to range from flat to up 2%, which doesn’t sound like much, but it beats the more subdued view shared by the Walmart’s U.S. stores division where ambiguous guidance calls for comps to be relatively flat.