Sam's Club closes in Natick; Santiago's Plaza changes hands
By christina p. o’neill
Developments on the region’s retail scene point to growing pains as the economy picks up. At the large end of the spectrum, Sam’s Club abruptly closed its warehouse club store in heavily retail-concentrated Natick earlier this month. On the small-business front, Santiago’s Plaza, in inner-city Worcester, has changed hands, with co-owners Ediberto Santiago and Maritza Cruz selling it to Providence-based Four Way Meat Corp. The second-generation company operates the Compare Foods supermarket chain. Sam’s Club, the warehouse club subsidiary of Bentonville, Arkansas-based Wal-Mart, closed its Natick store because it was not meeting company expectations, says Chris Buchanan, Sam’s senior manager of public affairs. Despite the strong local presence of BJ’s Wholesale Club and Costco in Natick, where BJ’s is headquartered, Buchanan says there are no plans for Sam’s to pull back in Massachusetts. When the store closed, Sam’s held a job fair for the 96 Natick sales associates and paid them six weeks’ wages. Long-term employees received additional severance packages.
BJ’s Wholesale Club’s Cathy Maloney declines to talk specifics about the competition in the warehouse club business. “The opportunity is not to take sales from other wholesale clubs,” she says. “The biggest opportunity is supermarkets.” That’s because BJ’s stocks 7,000 to 7,500 items, while the other two leading clubs carry about 4,000. Supermarkets typically stock 25,000 items.
Santiago’s Plaza will continue as it has been under new ownership. The new owners are a family of Dominican Republic-born entrepreneurs (as is Santiago himself) who specialize in inner-city stores. They operate at low cost and offer Caribbean and Latin American staples. Founded in Freeport, NY in 1989, the chain has an established track record of establishing customer loyalty and running successful stores in difficult locations.
For his part, Santiago — chosen by the Worcester Business Journal as its Business Leader of the Year in 2002 for his initiative to make private-sector investment in an inner-city neighborhood targeted for redevelopment — says the store did $11.5 million in sales in its most recently completed fiscal year but the business has seen its share of challenges, such as rising expenses and a tough city ordinance on shopping carts.
Four Way Meat Vice President Francisco Pena is optimistic, however. He says the store is running well just the way it is. His company will keep the 51 Santiago’s Plaza employees, and take time to learn more about the business, its customers and suppliers, before making any changes. Pena says the store’s multi-ethnic clientele of Hispanic and African customers mirror closely Four Way Meat’s customer base in Brooklyn and the Bronx. He says the previous owners are staying on through a “transition time” to get everyone acquainted. Four Way Meat’s first objective will be to expand the meat department with wider selection and lower prices.
Christina P. O’Neill can be reached at coneill@wbjournal.com
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