Sam’s Club will require a minimum purchase to receive free shipping

Sam’s Club is raising the bar on free shipping, following a trend that a new study shows is affecting retailers and customers across the country.

Sam’s Club Plus members pay an annual membership fee of $110 — $60 more than a basic membership — for additional benefits, including free shipping on most online items. But starting next month, Plus members will only get the $8 shipping fee waived on orders of $50 or more.

Analysts say Sam’s Club’s upcoming policy update is part of a broader trend in retail where companies are making changes to combat rising shipping costs. About half of 101 retail executives surveyed said they had raised the minimum fee for free shipping in the past 12 months, according to a May and June study by global consulting firm AlixPartners.

“They need to change policies to slowly but surely increase the profitability of home delivery and online sales,” said Marc Iampieri, partner and managing director at AlixPartners, which is the third year the firm has surveyed executives at U.S. retailers with revenues of $100 million or more.

Sam’s Club Shipping and Delivery Changes

Sam’s Club’s new shipping, delivery and pickup policies go into effect August 19 and apply to both Plus members and Club members (who pay a $50 annual fee).

Shipping for Plus members: Free shipping will be available on orders of $50 or more, and an $8 shipping fee will be charged for orders that don’t qualify. Sam’s Club warns that “some category exclusions apply where a variable shipping fee will apply.” Starting July 9, Plus members receive free shipping on qualifying items with no minimum purchase.
Same day delivery for Plus members: Free same day shipping will be available on qualifying orders over $50.
Curbside pickup for Club members:Club members will have access to free curbside pickup “on qualifying items” when they spend $50 or more. Currently, curbside pickup is only free for Plus members, and Club members must pay a flat $4 fee for curbside pickup orders.

Sam’s Club spokesman Steven Zapata said the changes are intended to “simplify the process and fees for same-day delivery and shipping” and “provide better access to the products our members purchase most often.”

Some Sam’s Club members expressed dissatisfaction with the policy change online, but Zapata said the policy change has been met with an “overwhelmingly positive” response from members who say it is “easy” to meet the $50 minimum basket value.

“It’s not surprising that Sam’s Club has faced some backlash for this decision, but it’s probably the only way to profitably maintain an online business,” said Blake Droesch, senior retail and e-commerce analyst at research firm eMarketer. “The economics of delivery are one of the biggest challenges facing retailers today.”

Are there any further changes to free shipping coming?

Other companies have raised the bar for free shipping in recent years. Amazon in late 2023 began testing a $35 minimum for non-Prime customers to qualify for free shipping, up from $25, according to reports from multiple outlets. Abercrombie & Fitch is offering free shipping on orders over $99, up from $75.

The higher thresholds can be partly blamed on inflation. Analysts say it makes sense for retailers to raise the free shipping threshold to cope with the new price of consumer goods, which have risen more than 20% in the past three years.

“Fifty bucks today is not the same as $50 three years ago,” Iampieri said.

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Higher transportation costs are also a factor. Three-quarters of retail executives surveyed said the cost of delivering a single parcel increased between 2023 and 2024, according to a new study from AlixPartners.

“(Online shopping) has always been expensive and has always cut into the margin a little bit, but now it’s gotten to the point where you can’t ignore it or just absorb it,” said Neil Saunders, managing director of analytics firm GlobalData. “You have to make the consumer pay a fairer share of it.”