Business

Sam's Club closings bad news for small business

Some buy a large number of items at the bulk-purchase stores

A employee walks by a meat cooler in the grocery section of a Sam's Club during a media tour in Bentonville, Arkansas June 5, 2014.  The tour was part of Walmart Stores Inc. annual shareholder meeting.   REUTERS/Rick Wilking
A employee walks by a meat cooler in the grocery section of a Sam's Club during a media tour in Bentonville, Arkansas June 5, 2014. The tour was part of Walmart Stores Inc. annual shareholder meeting. REUTERS/Rick Wilking

Wal-Mart last week announced it would be closing 63 of its underperforming Sam’s Club stores at various locations throughout the country. None of the affected stores are in Iowa.

While most of the news centered on the thousands of employees who would be affected by the decision, there’s also another significant group of people who also will be negatively impacted — hundreds, even thousands of local small businesses.

The retailer historically has prided itself on the services it has provided its small business members that include, for an annual fee, discounts on bulk purchases on office supplies, food, materials and other goods, financing, payment solutions and even health care insurance. The chain also has special hours to accommodate its small business customers — many of whom start the day early.

So it’s understandable why so many local merchants, restaurants, coffee shops and other small businesses were upset to learn of the sudden closures.

“They’re a significant part of my business,” Joe Gerace, the owner of a Chevron store in Anchorage, Alaska, said in a local television report. Gerace buys more than 300 items from Sam’s Club, and spends about $50,000 at the store every month.

Tamm DiCecca, who owns a cake shop in Greece, N.Y., buys much of her supplies from Sam’s Club. “That’s horrible news to many small businesses,” she told the Democrat and Chronicle.

It’s the same story in Florida.

“I go to that Sam’s three times a week. It’s an integral part of our business,” Roberto Torres, the owner of Blind Tiger Cafe in St. Petersburg, said in another local television station report. “We buy 30 percent of our cleaning supplies (there). I was going to buy a safe and some security cameras. I mean this is a very important store.”

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This is not the first time this has happened. Back in 2016, Wal-Mart closed 250 Sam’s Club locations. Even after this round, there still be almost 600 Sam’s Clubs in operation around the country.

Meanwhile, the company’s competitors, Costco and BJ’s Wholesale Clubs, are hoping to step in to the void.

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