Fri Jul 30 2010
by Mae Anderson
Associated Press
New York -- Wal-Mart Stores Inc. will cut about 11,200 jobs at Sam's Club warehouses as it turns over the task of in-store product demonstrations to an outside marketing company.
The move is an effort to improve sales at Sam's Club and comes on top of a decision to close 10 underperforming warehouse locations, which cost 1,500 jobs.
The cuts represent about 10 percent of the warehouse club operator's 110,000 staffers across its 600 stores. That includes 10,000 workers, mostly part-timers, who offer food samples and showcase products to customers. The company also eliminated 1,200 workers who recruit new members.
Employees were told the news at mandatory meetings Jan. 24.
A message left at Sam's Club at 1189 Buchholzer Blvd. in Cuyahoga Falls seeking comment from a manager was not returned by press time. There are 29 Sam's Club locations in Ohio.
According to information posted on the Web site address www.walmartstores.com/samsdemos, "At each club, approximately 18 demonstration program associates and two new business membership associates are affected."
The site also states "specific club information will not be available."
"In the club channel, demo sampling events are a very important part of the experience," said Sam's Club CEO Brian Cornell in a phone interview with The Associated Press. "Shopper Events specializes in this area and they can take our sampling program to the next level."
Shopper Events, based in Rogers, Ark., currently works with Wal-Mart's namesake stores on in-store demonstrations. Sam's Club is looking to the company to improve sampling in areas such as electronics, personal wellness products and food items to entice shoppers to spend more.
Sam's Club has underperformed the Walmart chain in the U.S. and abroad. Cornell has been working to improve results since taking the helm in early 2009, introducing new store formats, price cuts and offering more variety and more brands of items from take-home meals to baked goods.
Cornell said Sam's Club decided to eliminate its membership recruiting unit because "we have found that we can more effectively drive membership through targeted member acquisition events and by increasing our partner membership programs."
"I feel betrayed," said Sally Grueling, 56, who had worked at Sam's Club for nine years, most recently in Hilliard, Ohio, as a new business membership rep.
In a memo to employees, Cornell said eligible workers will receive severance pay and benefits, and that the company will help them find opportunities at other Sam's Clubs and in Walmart stores, in addition to Shopper Events positions.
The cuts come as many Americans had hoped job losses would abate as the economy slowly recovers. However, analysts said Jan. 24 that while this marks Wal-Mart Stores' largest job cut, they expect many employees to be picked up by Shopper Events, so the net effect on the economy probably won't be that bad.
Johnson said the number of jobs created via Shopper Events may not be one-to-one, he said, "but should be fairly close."
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