Seeking Alpha

Wal-Mart elixir: Set Sam's Club free

  • Wal-Mart (WMT -0.3%) needs to give Sam's Club its independence, reasons Belus Capital Advisors analyst Brian Sozzi.
  • The wholesale club has an impressive record of comparable store sales growth, but profits have suffered as it remains part of the Wal-Mart distribution behemoth.
  • A spinoff would let management create a stronger brand identity and could give Costco (COST +0.1%) something to worry about.
Comments (3)
  • How would this impact the DC network? If they could pull off the DC-side without issues, this is a no-brainer spinoff.
    15 Nov 2013, 09:43 AM Reply Like
  • According to the Trefis model, Sam's is 5% of the overall value do WMT. This makes me question their ability to stand alone in an efficient manner...DC being a good example.
    15 Nov 2013, 11:10 AM Reply Like
  • J,

     

    I worked there for 16 years and Sam's Club distribution system is 95% independent of Wal Mart. They have their own dry, frozen, perishable and produce distribution centers. The only commonality I ever saw was the Wal Mart trucks and drivers.
    15 Nov 2013, 11:42 AM Reply Like
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