Sam’s Club memberships rise Monday for the first time in almost a decade

Walmart’s Sam’s Club will raise its membership fees Monday, for the first time in almost a decade.

In a note to customers, CEO Kathryn McLay stated that the retailer will raise its annual membership fees from $45 to $50 for Club members. This is the first increase in five years. The Plus memberships will go up to $110 from $100. This is the first increase since 1999 when they were introduced.

These increases are due to the warehouse club’s “investment in technology to enhance the shopping experience”. It upgraded 600 clubs, created Sam’s Cash rewards program, and added new brands.

McLay stated that the company is aware of the financial challenges shoppers face right now due to worsening inflation. The company will offer credit equal to this year’s increase to customers who renew their membership.

Sam’s Club members will receive $5 in Sam’s Cash shortly after the renewal goes into effect. McLay claims that members will also receive $10 in Sam’s Cash.

The increase in fees came at a time when both the Walmart-owned and rival BJ’s Wholesale Clubs and Costco saw an increase even with inflation. data shows that July’s visits to Costco and Sam’s Club exceeded 2019, by 3.4%, 7.5%, and 10.5% respectively.

Costco, however, announced recently that it does not have any plans to increase fees for customers, unlike Sam’s Club.

“In terms of membership fee and a possible rise, there are no specific plans regarding an increase at this time,” Richard Galanti, Chief Financial Officer at Costco, stated during September’s earnings call.

Galanti stated that the company was “pleased” with its growth in top-line sales and membership households over several quarters, and in member loyalty which is reflected in higher member renewal rates.

The company has increased its membership fees approximately every five and a quarter years in the past. Galanti pointed out that the three most recent increases occurred on average every five years, seven months apart.

Costco, which raised its membership fees last June 2017, charges $120 annually for executive memberships and $60 for Gold Star and business memberships.

Bob Eddy, CEO of BJ’s Wholesale Club, stated in August that BJ’s Wholesale Club’s “strong results” in the second quarter were due to traffic gains.

Eddy also noted that the company’s “member base is growing in quality and size.”

ABasicmembership to BJ’s Wholesale Club is $55 per annum. Perks Rewards memberships cost $110 per annum.

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