Sam’s Club CEO To Leave Wal-Mart Next Month

Wal-Mart Stores Inc. said Friday that the chief executive of Sam’s Club will leave the company next month.

After five years in the role, Rosalind Brewer is the longest-serving CEO of Sam’s Club, Wal-Mart’s wholesale chain. She is 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.

Ms. Brewer, 54 years old, will be succeeded by John Furner, who currently serves as Sam’s Club’s executive vice president and chief merchandising officer. He returned to the company’s Bentonville, Ark., headquarters over the summer after a stint as a top executive with Walmart China.

As part of her departure agreement, Ms. Brewer is prohibited from working for another global retail company with revenue of more than $5 billion for two years, according to a financial filing, a clause typical of Wal-Mart executive employment contracts. Ms. Brewer joined Wal-Mart in 2006. She will leave the company Feb. 1.

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. Wal-Mart founder Sam Walton opened the first Sam’s Club in 1983, aiming to appeal to small businesses stocking up on bulk items.

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.

About 200 of Sam’s 656 U.S. stores share a parking lot with a Wal-Mart. Sam’s Club also opened its first regional buying office in Dallas last year, aiming to bring more local products to shelves, mimicking a technique Costco uses to localize nearly all of its buying.

“We want to be less of a Wal-Mart,” Ms. Brewer told The Wall Street Journal in a 2015 interview. Sam’s Club’s sales in stores open at least a year have strengthened slightly in recent quarters, rising 1.4% in the most recent quarter.

Sam’s Club declined to make Ms. Brewer or Mr. Furner available for an interview or share details on Ms. Brewer’s future plans. Her family relocated to Atlanta last year, according to people familiar with the move, sparking speculation that she would also move.

The CEO position at Sam’s Club has in the past served as a steppingstone to other high-profile jobs. Ms. Brewer’s predecessor, Brian Cornell, went on to become Target Corp.’s CEO, and the previous head of Sam’s, Doug McMillon, is now Wal-Mart’s CEO.

But it has also been a fraught role. The job has rotated frequently, often stymieing efforts to build momentum with a new strategy and shake its parent’s influence. For example, Mr. Cornell also made a push into more premium products, aiming for higher-income shoppers, before leaving in 2012.

Ms. Brewer has held a unique and at times challenging role as Wal-Mart’s highest-ranking African-American and female leader. She was criticized, for example, for promoting diversity at retailers and their vendors during a CNN interview in 2015.

Mr. McMillon came to her defense at the time, saying in a statement that “for years, we’ve asked our suppliers to prioritize the talent and diversity of their sales teams…that’s all there is to it and I support that important ideal.”

In a memo to staff on Friday, he praised Ms. Brewer for her time at the company and touted Mr. Furner as “someone who loves the company and our associates, has learned the business from the bottom up.” A new chief merchant for Sam’s will be named at a later date, he added.

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