BJ's Wholesale Club on Tuesday announced the launch of its B2B Sales division, which will offer businesses volume pricing; easy ordering and pickup; coordination of multiple pallet, truckload or container orders; and specialized services for minimum purchases of $5,000, according to a press release.
The wholesale retailer’s new B2B unit aims to streamline ordering and delivery without adding extra fees for domestic and international businesses. Orders are shipped directly to the BJ's location chosen by the business.
The program includes BJ's Volume Rewards Program, where businesses can earn back 1.6% of in-Club or BJs.com purchases with no cap on rewards. Rewards accrue monthly and applied toward future volume orders, the company said.
As a brick-and-mortar warehouse retailer, BJ’s Wholesale is in a space dominated by Costco and Wal-Mart-owned Sam’s Club, and its business is increasingly threatened by Amazon’s Prime membership program.
The percentage of U.S. households that pay for Amazon Prime shipping and multimedia services but hold no other club membership has grown from 7.1% in 2013 to 16.2% in 2016. Meanwhile, the percentage belonging to just Costco fell to 9.8% from 14.9% and Sam’s Club dropped to 9.7% from 16.9%, according to research from Cowen and Co. issued last year.
The business sales space provides an avenue for sales beyond retail, one that rival warehouse retailer Sam's Club has also bolstered with new services, including delivery and business loans. Sam's Club has experienced muted business customer sales in recent months as business owners have cut costs. The business-oriented moves from the warehouses present yet another challenge for Staples and Office Depot, which have also leaned on their business contracts to mitigate retail sales losses, especially after their proposed merger failed last year after an injunction requested by the Federal Trade Commission was granted.
"BJ's B2B Sales division minimizes stress and maximizes savings for businesses," Mike Leary, senior vice president, food, sundries and beverages at BJ's Wholesale Club, said in a statement Tuesday. "BJ's leverages its unique buying power to offer the lowest prices possible on grocery and general merchandise items, providing businesses with everything they need at an incredible value."
The retailer is pushing into the new market at a time when its private equity owners, Leonard Green & Partners LP and CVC Capital Partners Ltd., are reportedly preparing for a possible sale of the company, sources told the New York Post in April. That move would abandon its previous plans for an initial public offering. Amazon has been floated as a possible suitor, but the company has not responded to requests for comment from Retail Dive on the news.
BJ’s Wholesale Club spokesperson Kirk Saville told Retail Dive in April: “As a matter of policy, BJ’s Wholesale Club does not comment on rumors and speculation. As a company, we’re focused on providing outstanding value and service to our members.”