Domestic membership stores may replace foreign rivals amid Sam’s Club backlash
Published: Jan 03, 2022 10:45 PM
Sam's Club store in Yizhuang area of Beijing  Photo: Li Hao/GT

Sam's Club store in Yizhuang area of Beijing Photo: Li Hao/GT


Domestic membership stores such as Freshhema have great potential to develop and out-compete foreign rivals with more domestic e-commerce platforms launching membership stores, which experts note that foreign brands such as the Sam's Club may be at risk of losing their market share in China. 

Some Chinese brands seem to have made headway lately, taking advantage of the Sam's Club PR crisis.

The Global Times learned on Monday that customers with either Sam's Club membership cards or Costco membership cards in Suzhou, East China's Jiangsu Province, were able to tour the freshly opened local Freshhema X membership store on January 1.  

Domestic membership stores run by e-commerce giants like Alibaba have established a solid base in the market, ramping up investment to shore up their customer bases and compete with foreign rival brands, Zhang Yi, CEO of the iiMedia Research Institute, told the Global Times on Monday.

Zhang said that the foreign retail giants prevailed on the Chinese market because of their early entry, adding that more consumers will shift to shop at Chinese home retailers if foreign companies continue to blunder.

An online customer service agent at Freshhema said on Monday that consumers with Sam's Club membership cards or Costco membership cards can only tour the new store in Suzhou, and they have to register for store membership in order to make purchases and obtain points.

Sam's Club, the high-end membership store of Walmart, has been blasted by Chinese consumers and netizens for reportedly removing Xinjiang sourced products and threatening customers who want to return their membership cards with its "non-membership-reapplication for life" policy.

Staff members at Sam's Club stores in Beijing and Chongqinga confirmed the "no-membership-reapplication" rules, which means consumers are not able to reapply for memberships within six months after returning their current ones, and "for the rest of their lives" for the second time, saying it is the company's standard rule.

The number of consumers cancelling their membership cards has been increasing recently, but not "solely" because of the Xinjiang case, a staffer at a Sam's Club store in Chongqing said on Monday, while another employee from a Sam's Club Store in Beijing said that her store has not received any notification to remove Xinjiang products from shelves, stressing that the products have just not been in stock recently.

Consumers in multiple provinces across China including Shanghai, Central China's Hunan, East China's Jiangxi, Southwest China's Chongqing, and Beijing are cancelling their membership cards at local Sam's Club stores, according to media reports, while some Chinese netizens have posted screenshots on social media showing their cancellations through the Sam Club's app.

Sam's Club has 34 stores in China, with 23 stores under construction, according to media reports.