Hu Xiu·2025-08-19 02:14Core Viewpoint - The article discusses the challenges faced by membership stores in China, particularly focusing on the struggles of local brands compared to established foreign players like Sam's Club and Costco. It highlights the need for these stores to adapt to changing consumer demands and improve their product offerings and brand trust. Group 1: Membership Store Challenges - Sam's Club China has faced consumer criticism regarding product quality after introducing brands like Holley and Wangwang, leading to the removal of controversial products from shelves [1] - Hema has closed its last X membership store in several cities, indicating a retreat from the membership model [2] - The rapid expansion of membership stores has not translated into sustainable success, with local brands like Fudi shifting focus to high-end organic supermarkets instead of warehouse membership models [3][4] Group 2: Market Dynamics - The membership store model in China is undergoing a transformation due to deep changes in retail structure and consumer demand, suggesting a potential "value reshaping" for membership stores [5] - The rise of middle-class consumers in China, with a significant increase in GDP and private car ownership, has created a favorable environment for membership stores [30] - However, a trend of consumer downgrading has emerged, with shoppers increasingly prioritizing price and quality, pushing retailers to adapt [31] Group 3: Competitive Landscape - Sam's Club and Costco have established a strong foothold in China, with Sam's Club planning to open 8-10 new stores annually starting in 2025, while Costco faces challenges due to its reliance on imported goods [25][23] - The competition is intensifying, with various retail formats emerging, such as discount community supermarkets and boutique supermarkets, which may replace traditional membership stores [32][35] - Despite challenges, the middle-income group in China remains a solid consumer base for membership stores, with a report indicating that the population of middle-income individuals has reached 109 million [36] Group 4: Operational Insights - Sam's Club has been criticized for quality control issues following rapid expansion, with multiple food safety incidents reported [26][27] - The operational differences between local and foreign membership stores are evident, with foreign brands benefiting from established supply chains and procurement strategies [12][18] - Local membership stores must focus on product quality, service, and brand trust to remain competitive in a rapidly evolving retail landscape [16][37]