Core Viewpoint - The article discusses the challenges faced by Sam's Club in China, particularly regarding product quality issues and the impact of rapid expansion on its operations and customer trust [3][4][10]. Group 1: Sales Performance - In 2024, Walmart China achieved sales of 158.845 billion yuan, a year-on-year increase of 19.6%, despite an 8.5% decline in the number of stores [3]. - Sam's Club contributed two-thirds of Walmart China's performance, with sales exceeding 100 billion yuan in 2024 [4]. Group 2: Product Quality Issues - There has been a notable increase in product quality complaints at Sam's Club, with a 65% rise in complaints on the Black Cat complaint platform in 2024 [9]. - Specific incidents include customers finding foreign objects in products, such as plastic pieces in milk and rubber bands in beef patties [6][9]. Group 3: Membership Demographics - Sam's Club primarily targets middle-class consumers with an annual income of over 200,000 yuan, offering a "privilege club" experience for a membership fee of 260 yuan [6][10]. - The membership base has grown to nearly 9 million, generating over 2 billion yuan annually from membership fees alone [12]. Group 4: Expansion Strategy - Sam's Club plans to accelerate its expansion in China, aiming to open 8-10 new stores annually after 2025, following a significant increase in store openings in recent years [12][20]. - The rapid expansion has led to operational challenges, including quality control issues and management inefficiencies [10][12]. Group 5: Competitive Landscape - Sam's Club faces increasing competition from both international brands like Costco and local retailers such as Yonghui and Hema, which are encroaching on its market share [20][21]. - The membership model, while successful, presents challenges in maintaining high renewal rates, especially as consumers have more options [23][24].

Core Viewpoint - Sam's Club, known for its appeal to the middle class, is facing a significant food safety crisis after a customer discovered live worms in a purchased nut product, raising concerns about product quality and customer trust [1][3][5]. Group 1: Customer Experience and Reactions - A customer named Ms. Pan reported finding live worms in a nut product purchased online for 99 yuan, leading to her disappointment and loss of trust in the brand [3][5]. - Ms. Pan expressed her dissatisfaction with Sam's Club's response, which included a series of inadequate compensation offers, ultimately leading her to decide not to shop there again [5][6]. - The incident sparked a debate online, with some users attributing the issue to quality control failures, while others downplayed the significance of finding worms in such products [6][7]. Group 2: Historical Context of Quality Issues - This incident is not isolated; Sam's Club has faced multiple food safety issues in the past, including reports of live worms in other products, which raises questions about the company's quality assurance processes [7][10]. - Previous incidents included a customer discovering foreign objects in food items and issues related to the company's return policy, which resulted in fines from regulatory authorities [10][11][15]. - Despite these challenges, Sam's Club remains a respected player in the retail industry, with competitors acknowledging its business model and quality offerings [16][18]. Group 3: Business Model and Market Position - Sam's Club operates on a membership model that differentiates it from other retailers, relying primarily on membership fees rather than supplier fees or high profit margins [19]. - The company emphasizes providing high-quality products at competitive prices, aiming to maintain customer loyalty despite ongoing quality concerns [19]. - The founder's philosophy highlights the importance of customer satisfaction, indicating that quality issues could jeopardize the company's standing in the market [19].