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VIDEOWal-Mart Clubs Sam's Club
By
Scott Reeves Feb 25, 2009 3:00 pm
Brief scrutiny of today's headlines.
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The world’s largest retailer is closing its unprofitable Sam’s Club members-only warehouse stores in Canada and will focus on its super center and discount stores.
Sam’s Club has operated 6 stores in Ontario for about 5 years. Wal-Mart operates about 312 stores nationwide in Canada.
About 1,200 Sam’s Club employees will lose their jobs, but Wal-Mart said it will attempt to place them at other stores.
The company plans to open 26 new Wal-Mart super centers in Canada this year. The new stores are expected to create 5,000 construction jobs and 5,000 new store jobs.
The closures are a routine part of Wal-Mart’s constant effort to close underperforming stores and open new stores in more promising locations. But even Wal-Mart is cutting costs in the recession. Earlier this month, Wal-Mart announced that it planned to cut 700 to 800 jobs at in headquarters in Bentonville, Arkansas.
The Wall Street Journal reports that Lowe’s (LOW), a home-improvement retailer, is talking to Wal-Mart about taking over 5 Sam’s Club sites - 4 in the Toronto metro area and 1 in London, Ontario. The store in Cambridge, Ontario isn’t part of the discussions.
The 6 Sam’s Club stores are expected to close next month.
For the 52-weeks ended January 30, 2009, Wal-Mart reported sales of $398.3 billion, up 6.2% from the previous fiscal year.
No positions in stocks mentioned.
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