Walmart announced on Friday that Rosalind Brewer, CEO of its Sam's Club division, will leave the company on February 1, to be succeeded by John Furner, currently Sam’s executive vice president and chief merchandising officer.
The Wall Street Journal reports that as part of her contract, Brewer "is prohibited from working for another global retail company with revenue of more than $5 billion for two years ... a clause typical of Wal-Mart executive employment contracts."
The Journal also offers some context about Brewer's tenure:
"Sam’s Club has long struggled to turn around sluggish sales, vying for attention and investment dollars within its parent company to compete with fast-growing Costco Wholesale Corp ... Midway through Ms. Brewer’s tenure, she presented Wal-Mart’s board with potential strategic shifts for Sam’s Club, including spinning it off from the parent company, according to people familiar with the situation. Ultimately Wal-Mart decided to analyze which Sam’s locations could appeal to higher-income versus middle- and lower-income shoppers, stocking shelves with more relevant merchandise, a plan that has been discussed publicly over the last year ... Ms. Brewer refocused Sam’s Club’s attention on attracting wealthier shoppers, less on Wal-Mart’s core lower-income consumer. Sam’s Club executives believe higher-income shoppers are drawn to wholesale clubs that require membership fees, thereby lessening head-to-head competition with Wal-Mart itself."
The Journal also notes that Brewer was criticized in some quarters for promoting diversity programs at the company's vendors; she was "the first female African-American chief executive at the company, and her departure leaves no women or people of color with a CEO title at Wal-Mart."
The Wall Street Journal reports that as part of her contract, Brewer "is prohibited from working for another global retail company with revenue of more than $5 billion for two years ... a clause typical of Wal-Mart executive employment contracts."
The Journal also offers some context about Brewer's tenure:
"Sam’s Club has long struggled to turn around sluggish sales, vying for attention and investment dollars within its parent company to compete with fast-growing Costco Wholesale Corp ... Midway through Ms. Brewer’s tenure, she presented Wal-Mart’s board with potential strategic shifts for Sam’s Club, including spinning it off from the parent company, according to people familiar with the situation. Ultimately Wal-Mart decided to analyze which Sam’s locations could appeal to higher-income versus middle- and lower-income shoppers, stocking shelves with more relevant merchandise, a plan that has been discussed publicly over the last year ... Ms. Brewer refocused Sam’s Club’s attention on attracting wealthier shoppers, less on Wal-Mart’s core lower-income consumer. Sam’s Club executives believe higher-income shoppers are drawn to wholesale clubs that require membership fees, thereby lessening head-to-head competition with Wal-Mart itself."
The Journal also notes that Brewer was criticized in some quarters for promoting diversity programs at the company's vendors; she was "the first female African-American chief executive at the company, and her departure leaves no women or people of color with a CEO title at Wal-Mart."
- KC's View:
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Hard to know at this point exactly what went down here, except that with all the strategizing and repositioning, Sam's still seems to be struggling to figure out exactly where it fits into the new world retailing order. We've had a number of stories here in recent months about the kind of impact that companies like Amazon are having on Costco ... it'll be interesting to see if Walmart can figure out an interesting way to use its supercenters, membership clubs and online offerings to create some sort of new paradigm.
They can't operate in silos, in my opinion ... the whole has to be even bigger than the sum of the parts.
