It is important tonote that opportunities and threats are things that the company cannot cause orstopped by the company. In preparing a SWOT analysis for Sam’s Club I amconsidering the powerhouse monopoly it is. The Sam’s Club Company has avery extensive SWOT analysis. Thecompany’s strengths, weaknesses, opportunities, and threats are what both holdthe company back, and keep them motivated and excelling at the same time. Sam’sClub has many strengths. Sam’s Club is adominate companying in selling bundles to products to small business andindividual customers.
They are the 8th largest retailer in the U.S. by annualnet sales. Bring in about 56 billion dollars per year. With 621 Clubs in theU.
S. and Puerto Rico and has over 47 million members. Having this many Clubshelps give jobs to many people. Sam’sClub has lots of strengths just do to the size of the company. Sam’s Club isdifferent to other stores mostly because it sells products in bundles and atreasonable prices.
This allows families to shop for product that they can havefor a long time and not have to shop every week. Also they can sell products tosmall businesses that need a lot of products consistently. Anotherstrength is that Sam’s Club is a branch off of Wal-Mart.
Because of this, some products are similar towhat are sold between the two companies. This is a strength because customersthat 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’sClubs also has membership card where you can save money on good. When you’re amember you of Sam’s Club you can go into any other Sam’s Club location withyour membership card. An additional strength that Sam’sClub possesses is their wide range and selections of products. Sam’s club has done an excellent job inmaking sure that every individual’s needs are met through the products that areprovided on the shelves. There are avariety 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 manyproducts. Sam’s Club, knowing that theirmain customers are business owners, makes sure that customers have the productsneeded, even if it means going the extra step in ordering it to the store orthe front door of the business.Withevery strength there are weaknesses. Sam’s Club has many issues with employees including lawsuits and a highturnover rate. According to ForbesMagazine, associates work an average of 28 to 40 hour weeks Associates work an average of 28 to 40 hourweeks with a take home pay of only $250.00 a week.
The average family with the bread winnerworking as an associate at Sam’s Club is below the poverty line. One third of the associates’ children qualifyfor a free lunch. They are limited toonly 28 hours a week due to the fact that they are considered part time. This poses as an issue they do not qualifyfor benefits (PBS, 2013). Anotherweakness is that the Wal Mart Company does not have unions. This poses an issuebecause when employee’s needs are not met, they have no one to turn to withtheir best interest.
They only havemanagers and high up executives (PBS, 2013). Another weakness is the lack of timeoff 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 MartCompany’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 towork on Thanksgiving. This was televisedon major news outlets and went nationwide. Walmart Company has a 70% turnoverrate. (Politics USA, 2013). Sam’s Club has many major opportunities.
Sam’s Club has taken its potentialopportunities well. They have expanded immensely in the past. By opening theirown gas stations, this has allowed their current members to normally get betterdiscounted gas prices over normal gas stations. Sam’s Club also introducedpharmacies inside their own stores.
This saved their customers time, money andallowed them to shop for pharmaceutical needs at one location instead oftraveling 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. Oneof 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 canbuy whatever they need at home, the office or now on the go with the release ofsmartphones. With Click & Pull, members are able to purchase items onlineby five P.M.
and pick their item(s) up at a store the very next day. This makesshopping a lot easier and allows their members to skip the hassle of shoppingat a store. They can find their product online, purchase it and then pick it upnext 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 removesthe need of using a web browser and makes it easier to search for items. Theapp helps members shop smart and save even more on a mobile device. While usingthe app, you can manage your membership, order whatever items needed, use clubmode, and even check out faster with Scan & Go. As Sam’s Club grows, theyhave continued to expand their mega stores around the globe. However, they areonly located in four countries outside the U.
S., China, Brazil, Mexico andPuerto Rico. They could open up major markets by putting locations in Europe.London, Paris, Berlin, Rome, and Amsterdam all seem like strong contenders fora Sam’s Club location. They should take advantage before a competitor like BJ’sor Costco begins to dominate in these relatively untapped markets. Sam’s Club is one of the mostdominate wholesale companies in the industry.
They have continued to provideexcellent products at great prices. Their membership has continued toskyrocket. They have really stuck to their owner’s view that you can always striveto do better. For the short term they are very well off. As long as they stickto what they have proven is successful they will always be a force in thewholesale industry. However, in the long run they will need to make sure theyare prepared for the opportunities of advances in technology, adaptation to newand prosperous small businesses, ability to supply all new equipment, productsand services these new organizations, customers, and small businesses need tosucceed. Last but not least, Sam’s Club’s threats areextensive.
As much as one would like tobelieve that things can be perfect in a business if it succeeds well, this isnot the case. Sam’s Club requires membership in order to shop at their storeshowever 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 otherdepartment stores where products are offered to everyone. There are not manySam’s Club stores in the same area while it is fairly easy to find Wal-Marts incloser proximity. Although Sam’s Club is international, there are only a coupleof stores outside of the U.S. They are located in China, Brazil, Mexico andPuerto Rico and there is only one in each country. Sam’s Club’s biggestcompetitors are BJ’s and Costco and both have seen growth in their locationsacross America whereas Sam’s Club has remained at the same number of stores forquite some time. The true issue is that Sam’s Club is a subsidiary of Wal-Martand the focus seems to be that more Walmarts should be built instead of Sam’sClub stores.
Also, due to the economic crisis, more and more small businessesclose or go out of business each day and since small businesses are Sam’sClub’s primary customers they will eventually see a decline in sales (Historyof Sam’s Club, 2012). In closing, Sam’s Club is a companywith a lot to offer. Not only is itgrowing in size, but in employees, and the products they offer. We believe that as a company, if they continueto mistreat their employees, eventually, they will find somewhere else towork. A company cannot run without itsemployees. They are undoubtedly, thebackbone of the company.
A consumer canfind the same product somewhere else, but without workers, the machine that isthe business will not run. The fact thethere is a 70% turnover rate with the company is a huge indicator that thecompany does not take care of the employees. Employee relations are very important in any business, and without it,employees are unhappy. If this is thecase, quality work will not get done. If guests are not happy with the customerservice and product, he/she can always go to a competitor for the same product.