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Sam’s Club hopes fewer stores help the warehouse retailer attract more-affluent shoppers.
This month, the Wal-Mart WMT -1.63% Stores Inc. chain closed 63 U.S. Sam’s Club locations. The closures cut about 10,000 jobs and are the largest since Wal-Mart founder Sam Walton opened the first Sam’s Club in 1983. Wal-Mart says some of those workers will get jobs in other stores.
The closures aren’t only a result of retail’s rapid shift online, but are part of a strategy pivot by new Sam’s Club Chief Executive John Furner to turn what has long been Wal-Mart’s underperforming sibling into a retailer that can rival its most successful competitor, Costco COST -0.21% Wholesale Corp.
“The strategy isn’t to close clubs. The strategy is to transform the business,” said Mr. Furner, a Wal-Mart veteran who took over the warehouse chain last February.
Sam’s Club hopes that by strategically closing underperforming stores, it can fine-tune its focus on stores that are driving higher profits, especially those that serve a higher-income clientele.