A glimpse into the future of Supply Chain at Sam’s Club: Innovating to meet accelerated eCommerce growth

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Oct. 29, 2020

You might not think about it, but the strength of a supply chain can make or break a member’s online ordering experience. At Sam’s Club, we not only know this, but we are leaning in even further. And as our eCommerce business grows, we are constantly working to ensure our fulfillment network — from logistics to packing to delivery— stays nimble and resilient. So, what does that look like? Check out how we are transforming our supply chain network to continue delivering special moments for members, associates, and the future of Sam’s Club below.

For members

Sam’s Club meets our members where they are. “Regardless of whether our members choose to shop in club, curbside, or online, we are committed to creating frictionless, omni-channel shopping experiences that provide our members with value and speed,” says Monique Picou, SVP and Chief Supply Chain and Strategy Officer.

So, we launched Ship from Club to more than 100 clubs, enabling associates to pick, pack, and deliver online orders right from their clubs’ inventory. With Ship from Club expected to account for one-fifth of all eCommerce orders, Sam’s Club can move product at faster rates and maximize the growth of our eCommerce business.

For members, this means shorter delivery times, greater online selection, and an even better shopping experience — right in time for the holidays, too!

A Sam’s Club associate using Ship from Club to fulfill members’ eCommerce orders.
Annamarie Ivie, a Sam’s Club associate, using Ship from Club to fulfill members’ eCommerce orders.

For associates

Our supply chain associates deliver day in and out—literally—and Sam’s Club does the same for them. All hourly associates in fulfillment centers will receive a $2 hourly premium during the holiday season. In addition to our existing team, we are also hiring 2,000 full-time associates in our fulfillment and distribution centers across the country.

In October, we opened a new high-tech, innovation-focused fulfillment center in Perris, California, just outside of Los Angeles. In partnership with GreyOrange and Quadient, Sam’s Club integrated automation and robotics into the new fulfillment center, using this location as the blueprint for future innovation in our supply chain. Here, we are adding more than 400 full-time associates to manage operations and kick start innovative solutions.

“Fulfillment center roles can be physically demanding, and the work can be repetitive. The technology we have in this building optimizes these processes and helps improve the workload, allowing associates more time to upskill and train for the cutting-edge opportunities Sam’s Club has to offer,” says Mike Petterborg, General Manager of the fulfillment center. “So, the innovation not only helps us take better care of our products and members, but most importantly, it helps us take better care of our associates.”

A first glimpse inside of Sam’s Club’s newest fulfillment center and innovation lab in Perris, California.
A first glimpse inside of Sam’s Club’s newest fulfillment center and innovation lab in Perris, California.

For the future

Our main goal is to satisfy the current needs of our stakeholders, but it is just as critical for Sam’s Club to think about the future — the future members, the future of the company, and the future of the world. This mindset is exemplified through our new fulfillment center: one-part traditional fulfillment center, one-part innovation lab where new and disruptive ideas will be tested, iterated upon, and launched.

For instance, we recently introduced Packing Visualization, Sam’s Club’s patented 3D visualization packing software. Simplifying the previously manual process, our software uses automated intelligence and illustrations to show associates the easiest and most accurate way to place items. After the products have been placed, associates simply press a button for the items to be measured and precisely packed into fit-to-order cartons. Then the order is ready to be sorted and sent off to our awaiting members!

“By employing automated fit-to-order packaging technology and 3D visualization in our fulfillment centers, Sam’s Club reduces redundant work for our associates, prevents damage to members’ orders, and helps us lower our carbon footprint and the amount of shipping material utilized,” says Vinod Bidarkoppa, SVP and Chief Technology Officer.

Vinod Bidarkoppa, SVP and CTO, testing Sam’s Club’s patented Packing Visualization software.
Vinod Bidarkoppa, SVP and CTO, testing Sam’s Club’s patented Packing Visualization software.

We consider that a triple win— but remember, we are leaning in, so we are not stopping there. As demand for eCommerce continues to increase, we are thinking differently about our supply chain operations and leveraging technology to equip ourselves for the changing retail landscape, always doing so with our members, associates, and the future of Sam’s Club in mind.