Core Viewpoint - The article discusses the decline of Sam's Club in China, highlighting consumer dissatisfaction due to perceived quality control issues and management changes, particularly the appointment of a new president from Alibaba, which has led to a loss of trust among members [4][6][20]. Group 1: Consumer Trust and Experience - Sam's Club has faced backlash from consumers after controversial product listings and changes to its app, which led to accusations of misleading marketing practices [5][11]. - The shift from real product images to AI-generated images has raised concerns about transparency, with consumers feeling deceived regarding product quality and information [5][13]. - Members who paid annual fees of 260 to 680 yuan have expressed feelings of betrayal as they perceive a decline in product quality and service [11][13]. Group 2: Management Changes and Internal Culture - The appointment of Liu Peng, a former Alibaba executive, as the new president has sparked criticism and led to a perception that Sam's Club is shifting towards a more data-driven, less customer-focused approach [6][20]. - Internal reports suggest a cultural shift towards a "KPI-first" mentality, resulting in overworked employees and a decline in service quality [14][16]. - The management style change after Andrew Miles' retirement has been linked to a deterioration in product quality and customer service, as the focus has shifted away from member value [16][22]. Group 3: Financial Performance and Market Position - Despite the decline in consumer trust, Sam's Club has reported a 5.9% increase in sales for the second quarter of fiscal year 2025, with membership fee revenue growing over 40% [19]. - The company plans to open eight new stores in 2025, aiming to capitalize on its position as a core growth engine for Walmart in China [24]. - Sam's Club's revenue in China surpassed 100 billion yuan in 2024, accounting for nearly two-thirds of Walmart China's performance [24]. Group 4: Competitive Landscape - Sam's Club faces significant competition from Alibaba's Hema and Costco, with Hema's innovative strategies posing a particular threat [25]. - A price war initiated by Hema has impacted Sam's Club's product offerings and market share, highlighting the competitive pressures in the retail sector [25][27]. - The article suggests that Sam's Club's previous dominance in the market is being challenged by competitors who are more agile and responsive to consumer needs [25][28].

Core Viewpoint - The recent public relations crisis faced by Sam's Club reflects a growing disconnect between the brand and its middle-class members, leading to a decline in trust and membership satisfaction [1][14][18] Summary by Relevant Sections Recent Events - From July to October 2025, Sam's Club experienced multiple controversies, including the "Holly Friend" incident, quality degradation of organic soybeans, delivery issues, and negative feedback regarding the app's user experience [2][3][6] - The "Holly Friend" incident involved the introduction of popular products while removing high-repurchase items, leading to public outcry about product quality [2][6] - The company acknowledged a decline in product quality and faced criticism for delivery practices involving overloaded vehicles [2][4] Management and Strategy - The appointment of former Alibaba executive Liu Peng as president raised concerns about the brand's direction, with accusations of adopting a more aggressive e-commerce strategy [3][5][10] - Sam's Club's response emphasized its commitment to addressing member feedback and improving the app experience, distancing the app changes from the management transition [4][14] Member Trust and Identity - The core issue lies in the erosion of trust among Sam's Club's middle-class members, who expect high-quality products and services in exchange for their membership fees [14][17] - Membership fees serve as a "trust tax," creating a sense of ownership and expectation among members regarding product quality and service [11][12] - The brand's rapid expansion has put pressure on its supply chain, leading to concerns about maintaining quality and operational efficiency [15][17] Market Position and Competition - Despite the controversies, Sam's Club continues to expand, with plans to open additional stores, although membership growth has slowed significantly from 40% to 16% [14][18] - The brand's unique selling proposition relies on a combination of product selection, supply chain management, and member trust, which are critical for maintaining its competitive edge [17][18]

Group 1 - The last Hema X membership store, "Shanghai Senlan Shangdu Store," officially closed on August 31, 2023, with remaining products sold at clearance prices of 10-30% off, attracting customers for final purchases [1] - Hema X membership stores have been closing throughout the year, including locations in Shanghai, Beijing, Suzhou, and Nanjing, with the closures attributed to a proactive business adjustment by Hema [4] - Hema X membership stores, launched by Hema Group, are the first Chinese brand in the warehouse-style membership market, competing with Costco and Sam's Club, with the first store opening in October 2020 [5]

Core Viewpoint - Hema has decided to close all its X membership stores due to business adjustments, with the last remaining store in Shanghai set to cease operations on August 31, 2023 [2][4][5]. Store Closures - Hema X membership stores have been gradually closing since early 2023, with multiple locations in Shanghai, Beijing, Suzhou, and Nanjing shutting down [5][11]. - The last operational store, Shanghai Senlan Shangdu, will close on August 31, 2023, marking the end of the Hema X membership store format [4][8]. Customer and Employee Impact - Customers can refund their Hema X membership cards or transfer them to other Hema formats, such as Hema Fresh and Hema Mini, maintaining some benefits like discounts [8][9]. - Employees have reportedly been forced to transfer to other stores, with claims of contract changes and potential termination for non-compliance [3][13]. Business Model and Competition - Hema X membership stores were designed to compete with established brands like Sam's Club and Costco, featuring a warehouse-style layout and integrated online-offline services [11][15]. - Despite rapid expansion, Hema X faced intense competition and quality control issues, leading to a decline in customer satisfaction and store performance [10][13]. Future Strategy - Hema plans to focus on its core businesses, Hema Fresh and Hema NB, shifting away from the X membership store model [15]. - The company aims to open nearly 100 new Hema Fresh stores in the upcoming fiscal year, indicating a strategic pivot towards community-oriented retail [15].

Core Viewpoint - Hema is closing all its X membership stores due to business adjustments, with only one store remaining operational until August 31, 2023, marking the end of this retail format in China [2][3][6]. Group 1: Store Closures - Hema has announced the closure of multiple X membership stores throughout the year, with the last operational store located in Shanghai [3][5]. - The Beijing World Flower store has been completely stripped of equipment and is locked, awaiting a new tenant [5]. - Hema's customer service confirmed that X membership cards can be refunded or used in other Hema formats, such as Hema Fresh and Hema Mini [5][6]. Group 2: Employee Impact - Employees were reportedly forced to transfer to other stores after the closure, with claims of coerced contract changes and potential termination for non-compliance [12]. - The company has faced criticism for its handling of employee contracts and labor relations during this transition [12]. Group 3: Market Competition - Hema X membership stores faced intense competition from established players like Sam's Club and Costco, as well as local competitors like RT-Mart and Ole [8]. - Despite initial ambitions to compete directly with these brands, Hema's X membership stores struggled to maintain customer interest and quality standards [7][10]. Group 4: Future Strategy - Hema plans to focus on its core businesses, Hema Fresh and Hema NB, shifting away from the X membership model [12]. - The company aims to open nearly 100 new Hema Fresh stores in the upcoming fiscal year, indicating a strategic pivot towards community-oriented retail [12].

Core Viewpoint - Hema's membership store format is set to disappear entirely, with the last remaining store in Shanghai closing on August 31, 2023, following the closure of several other locations earlier this year [1][4]. Group 1: Membership Store Closure - Hema has been closing its X membership stores throughout the year, with the last one in Shanghai scheduled to cease operations, marking the end of this store format [1][4]. - The X membership store format was initially launched in October 2020 and expanded to major cities, but it is now being phased out as the company shifts focus to other business models [2][4]. Group 2: Strategic Shift - Hema's management has decided to redirect resources towards Hema Fresh and Hema NB, indicating a strategic shift away from the membership store model due to high investment costs and long payback periods [4][5]. - The CEO of Hema expressed confidence in the Hema NB format, with plans to grow the number of stores to 300 by the end of 2024 [4]. Group 3: Challenges of Membership Stores - The membership store model requires significant capital investment for physical store expansion and supply chain capabilities, which has proven challenging for Hema [5][6]. - Intense competition from established membership stores like Sam's Club and Costco, as well as emerging players like Dailu Fan and Ao Le Qi, has further pressured Hema's membership store performance [6]. Group 4: Future Outlook - The retail landscape is becoming increasingly competitive, with a focus on profitability driving Hema's decision to discontinue the membership store format [6]. - The company is likely to continue experimenting with various retail formats to identify the most profitable avenues for growth in a rapidly evolving market [6].

Core Insights - Hema's membership store business is being completely shut down, marking the end of its attempt to establish a second growth curve through this model [1] - The last remaining Hema X membership store in Shanghai will close on August 31, following the closure of stores in Beijing and Suzhou on July 31 [1] - Hema X membership stores were launched in October 2020, aiming to compete with Costco and Sam's Club as the first Chinese brand in the warehouse membership sector [1] Summary by Categories Business Performance - All Hema X membership stores will cease operations after August 31, indicating a strategic withdrawal from the membership model [1] - The closure of these stores reflects challenges in attracting and retaining members, as evidenced by customer complaints regarding membership benefits and product quality [1] Market Position - Hema X was positioned as a competitor to established players like Costco and Sam's Club, but has failed to gain traction in the market [1] - The brand's initial launch aimed to tap into the growing demand for membership-based shopping experiences in China [1]

Group 1 - Sam's Club recently launched a new product, a 49.9 yuan snack containing 48 pieces, which claims to have "80% less sugar" and "30% more cocoa" compared to regular versions, but has faced backlash from members due to perceived lack of ingredient optimization and inclusion of potentially harmful additives [1] - As of June 2025, Sam's Club in China has over 9 million paid members, generating membership fee revenue exceeding 2.34 billion yuan, with a year-on-year increase of over 40% in Q1 2025 [1][2] - The average annual spending of Sam's Club members is over 8,000 yuan, significantly higher than typical supermarket spending, indicating a strong appeal to the middle-class demographic [2] Group 2 - The introduction of common brands like Holley Friend and others has led to a perception shift, as these products are widely available elsewhere, challenging the exclusivity that members expect from Sam's Club [3] - The rapid expansion of Sam's Club in China may have strained its supply chain management, resulting in a decline in product quality control [3] - Consumer dissatisfaction reflects broader concerns about food safety and quality standards in China, pushing for higher food safety regulations and standards [4]