E-commerce / RetailChina
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JOURNEY · DETAIL
Sam's Club: Walmart's membership-only warehouse retailer, capturing the Chinese middle class through membership fees and viral hit products
Founded: Sam Walton · Sam's Club (a subsidiary of Walmart)
JOURNEY
Key Fields
FIELD STAMPSIndustryE-commerce / Retail
RegionChina
ScaleGiant
ChannelOther
Origin
Sam's Club was founded by Walmart founder Sam Walton in the U.S. in 1983. Its logic relies on using membership fees to filter the customer base and leveraging large-format packaging and low margins to drive high turnover. It entered China in 1996, opening its first store in Shenzhen (also the first in Asia). However, due to low household income, low car ownership, and limited living space in China at the time, the warehouse bulk-buy model struggled significantly. For the first 20 years, it operated only a dozen stores, remaining on the verge of losses and internally debating whether to retreat.
Milestones
1983
Founding PMF
Sam Walton opened the first Sam's Club in the U.S., benchmarking the warehouse membership model of Price Club. The core innovation was charging customers a membership fee in exchange for low-margin, bulk-packaged goods. Product sales were essentially non-profitable, with profits derived primarily from membership fees—a model later popularized by Costco and studied extensively by the global retail industry.
1996
Entry into China Failure
Sam's Club opened its first Chinese store in Shenzhen, but expansion remained extremely slow for nearly 20 years. By 2015, there were only a dozen stores nationwide. The reasons included an insufficient middle-class population, low car ownership, and a conflict between bulk-packaged goods and the Chinese habit of frequent, small-quantity shopping. It was widely regarded in the industry as a failed case of the foreign warehouse model in China.
2016
Strategic Pivot Turning Point
Sam's Club China adjusted its strategy to focus on middle-to-high-income families in Tier 1 and Tier 2 cities. It significantly streamlined SKUs to about 4,000, strengthened its private label 'Member's Mark,' and emphasized differentiated fresh and bakery products. Leveraging Walmart's partnership with JD.com, it launched e-commerce and one-hour delivery, catching the window of the rising Chinese middle class and increased car ownership, entering a phase of rapid expansion.
2019
Viral Breakthrough Growth
Viral items like rotisserie chicken, Swiss rolls, and mochi flooded platforms like Douyin and Xiaohongshu. Young people turned visiting Sam's into a social media 'check-in' activity, and the store became a symbol of middle-class lifestyle. A reseller industry emerged, with resellers earning over 10,000 RMB monthly by breaking down bulk packages and reselling membership benefits. Sam's evolved from a retail channel into a phenomenal consumer IP from 2019 to 2021.
2024
Surpassing 100 Billion RMB Growth
In 2024, Sam's Club China reached 100.5 billion RMB in annual sales, becoming the first foreign retailer in China to break the 100 billion mark. Membership and store counts climbed in tandem, and the share of paid memberships in total revenue and profit structure continued to rise, validating the 'membership fee + high repurchase' model in the Chinese market.
2025
Trust Crisis and Rapid Growth Turning Point
Sales surged to 140 billion RMB in 2025, a nearly 40% year-on-year increase. With 63 stores across 30 cities (10 new stores opened that year, a record high), paid members exceeded 9 million with a 92% renewal rate. However, controversies over mass-market product selections like Orion Choco-Pie sparked strong dissatisfaction among members, leading to questions about the brand's 'curated' positioning. Some members publicly canceled their memberships, highlighting the conflict between quality control and rapid expansion.
Turning Points
- Endured 20 years of dormancy after entering China in 1996, waiting for the maturation of the Chinese middle class and car-owning society.
- Shifted focus around 2016 to target middle-class customers, streamlined SKUs, and bet on private labels, turning from a mismatch to a perfect fit.
- Viral products leveraged short-video platforms to break through, turning supermarket shopping into social currency and achieving zero-cost customer acquisition.
- The 2025 Orion Choco-Pie selection controversy became a watershed moment, testing the core asset of membership-based retail: trust.
Failures & Pitfalls
- Only a dozen stores in the first 20 years; the bulk-packaging model was severely misaligned with Chinese household consumption habits, long viewed as a failure.
- Over-reliance on viral products led to traffic volatility; once the hype for items like rotisserie chicken or Swiss rolls fades, new hits must be constantly manufactured.
- Introducing mass-market brands like Orion in 2025 triggered a trust crisis, with some long-term members publicly refusing to renew.
- Resellers breaking down packages and reselling membership rights created a gray market, eroding the pricing system and causing food safety and after-sales disputes.
关键成功要素
- Membership fees pre-screen the customer base, shifting the supermarket from earning price spreads to earning service fees; a 92% renewal rate is the core moat.
- Approximately 4,000 curated SKUs reduce choice costs, using 'less but better' to compete against the 'more but mediocre' approach of traditional supermarkets.
- Private label 'Member's Mark' and exclusive bakery/fresh products create differentiation, making price comparison ineffective.
- Supply chain efficiency driven by bulk packaging, low margins, and high turnover results in single-store sales far exceeding traditional hypermarkets.
- Tacitly allowing and benefiting from the organic spread of resellers and social media, achieving middle-class mindshare with zero marketing spend.
Lessons
- There is no right or wrong business model, only timing; Sam's waited 20 years for the Chinese middle class to emerge before exploding.
- The essence of a membership model is a trust business; the damage from one poor product selection is far greater than the cost of not opening a store.
- Letting users advocate for you is cheaper than advertising; viral products are social currency that can be designed.
- When rapid expansion outpaces quality control capabilities, scale becomes a liability rather than an asset.
- Restricting the number of SKUs can actually improve sales per square foot; retail efficiency comes from subtraction.
Core Data
- 2025 Sales：140 billion RMB (based on public data, not independently verified)
- 2024 Sales：100.5 billion RMB (based on public data, not independently verified)
- Paid Members：Over 9 million (based on public data, not independently verified)
- Membership Renewal Rate：92% (based on public data, not independently verified)
- Number of Stores in China：63 (based on public data, not independently verified)
- Walmart China 2026 Sales Target：Over 200 billion RMB (based on public data, not independently verified)
- Annual Membership Fee：Starting from 260 RMB (based on public data, not independently verified)
Competitors / Peers
Sam's Club dominates the membership-only warehouse sector in China. Key competitors include Costco (entered in 2019, with far fewer stores than Sam's, relying on items like Moutai and Hermes to create opening hype but maintaining conservative expansion), local players like Hema X Member Store (which once aggressively benchmarked Sam's but later significantly scaled back), fudi, M Member Store (under Sun Art Retail), and Metro's transformed stores. Domestic imitators generally struggle with supply chain depth and private label capabilities, learning the form of warehouse retail but failing to grasp the essence of global procurement and member trust. There is a saying in the industry that a 'domestic Sam's Club' has been impossible to produce for 30 years.