A Sam's Club outlet in Guangzhou, Guangdong province. [Photo / Provided to China Daily]

Wal-Mart targets affluent Chinese families in drive for expansion

Wal-Mart Stores Inc said it will open more Sam's Club stores - membership-only warehouse clubs targeting affluent Chinese families - in the next two or three years to cope with the slowdown of its hypermarket business.

The world's largest retailer by revenue is expected to open seven Sam's Club stores in the country, said Andrew Miles, senior vice-president and chief operating officer for Sam's Club in China.

Sam's Club, which opened its first store in China in Shenzhen in 1996, has 10 stores in the country. The company provides memberships for individual shoppers and business customers, but the majority of its clients are individual shoppers.

There are 620 Sam's Club stores in the United States, generating $49 billion in sales annually. The company is the eighth biggest retail business in the US.

On Saturday, a store which opened in Suzhou - a third-tier city in affluent Jiangsu province - became the 799th Sam's Club in the world. The company has international sales of $58 billion annually.

"While people say that retail is detail, clubs are also discipline models," Miles said.

A 30-year retail veteran, with 20 years at the A.S. Watson Group, Miles said that running a club business is far more difficult than running an ordinary retail business.

"We are a disciplined, focused, low-cost operation," he said. "Not easy."

Sam's Club customers have to pay 150 yuan per year ($24.23) for shopping at the stores. Miles said that the membership fees make them think differently about their operations because their customers expect more, and they have to work hard to make sure that they are satisfied.