| Type | Subsidiary |
|---|---|
| Industry | Retail (convenience stores) |
| Founded | 1927 |
| Headquarters | Dallas, Texas, U.S. |
| Number of locations | 39,000+ |
| Key people | Joseph DePinto, President/CEO |
| Products | Slurpee beverage Big Gulp beverage Cup Other products include: coffee, sandwiches, prepared foods, gasoline, dairy products, various beverages |
| Revenue | $16.681 billion (Estimated) US$ (2009)[1] |
| Employees | 45,000 (2010 NA) |
| Parent | Seven & I Holdings Co. Ltd. |
| Website | 7-eleven.com 7andi.com sej.co.jp |
7-Eleven is part of an international chain of convenience stores, operating under Seven-Eleven Japan Co. Ltd, which in turn is owned by Seven & I Holdings Co. of Japan.[2]
7-Eleven, primarily operating as a franchise, is the world's largest operator, franchisor and licensor of convenience stores, with more than 39,000 outlets,[3] surpassing the previous record-holder McDonald's Corporation in 2007 by approximately 1,000 retail stores.[4] The US subsidiary of the Japanese firm has its headquarters in the One Arts Plaza building in downtown Dallas, Texas.[5] Its stores are located in 16 countries, with its largest markets being Japan, the United States, Canada, the Philippines, Hong Kong, Taiwan, Malaysia and Thailand.[6] On a per-capita basis, Norway, for example, has one 7–11 for every 47,000 Norwegians, versus Canada, which has one for every 74,000 Canadians.[7]
Contents |
The company has its origins in 1927 in Dallas, Texas, when an employee of Southland Ice Company, Joe C. Thompson, started selling milk, eggs and bread from an ice house.[8][9] The original location was an improvised storefront at Southland Ice Company, an ice-manufacturing plant owned by John Jefferson Green. Although small grocery stores and general merchandisers were present in the immediate area, Thompson, the manager of the ice plant, discovered selling convenience items, such as bread and milk, was popular due to the ice's ability to preserve the items. This significantly cut back on the need to travel long distances to the grocery stores for basic items. Thompson eventually bought the Southland Ice Company and turned it into Southland Corporation, which oversaw several locations which opened in the Dallas area. Initially, these stores were open from 7 am to 11 pm, hours unprecedented in their length, hence the name. The company began to use the 7-Eleven name in 1946. By 1952, 7-Eleven opened its 100th store. It was incorporated as Southland Corporation in 1961.[10]
In 1962, 7-Eleven first experimented with a 24-hour schedule in Austin, Texas.[11] By 1963, 24-hour stores were established in Las Vegas, Fort Worth, and Dallas.[12]
In the 1980s, the company ran into financial difficulties, selling off its ice division, and was rescued from bankruptcy by Ito-Yokado, its largest franchisee. In 1987, John Philp Thompson, the CEO of 7-Eleven, completed a $5.2 billion management buyout of the company his father had founded.[13] The buyout suffered from the 1987 stock market crash and after failing initially to raise high yield debt financing, the company was required to offer a portion of the company's stock as an inducement to invest in the company's bonds.[14][15]
The Japanese company gained a controlling share of 7-Eleven in 1991,[10] during the Japanese asset bubble of the early 1990s. Ito-Yokado formed Seven & I Holdings Co. and 7-Eleven became its subsidiary in 2005. In 2007, Seven & I Holdings announced it would be expanding their American operations, with an additional 1,000 7-Eleven stores in the U.S.
Among 7-Eleven's offerings are private label products, including Slurpee, a partially frozen soft drink introduced in 1967,[16] and the Big Gulp introduced in 1980[16] that packaged soft drinks in large cups ranging in size from 20 to 64 US fluid ounces (0.59 to 1.9 liters).
The Big Gulp fountain drink brand refers to the name of the 32 US fl oz (0.95 l) fountain drink, the Big Gulp. Variants include:
In 2005, 7-Eleven began selling its brand of bottled drinks under the Big Gulp brand name in North America.
In July 2002, 7-Eleven introduced the Slurp & Gulp for a limited time. The 54-ounce Slurp & Gulp plastic cup held a 22-ounce Slurpee container inside a 32-ounce Big Gulp cup for soda. The two cold drinks were combined with a domed lid that had two holes for both a Big Gulp straw and Slurpee spoon straw.
In addition to Slurpee and the Big Gulp, 7-Eleven would come to own or operate several brands of food and concepts, including Movie Quik, an in-store video-rental service; Citgo, the gas brand sold at many locations up until 2006; as well as Chief Auto Parts, which had locations adjacent to or near several 7-Eleven locations. They bought White Hen Inc. on August 10, 2006, mostly in or around the Chicago area, and plan to convert all of the remaining White Hens to 7-Eleven stores.
Since 2005, the company has offered 7-Eleven Speak Out Wireless, a prepaid phone service where a cellphone can be purchased directly from a 7-Eleven store in the US and Canada and activated on the spot.
The 7-Eleven convenience store announced on November 3, 2009 that it was releasing two low-priced proprietary wines in the United States and Japan (under the "Yosemite Road" brand).[17]
The first 7-Eleven in Australia opened on August 24, 1977 in the Melbourne suburb of Oakleigh. There are currently 565 stores in the states of Victoria, New South Wales and Queensland; the majority of stores are in metropolitan areas, particularly in CBD areas. Stores in suburban areas often operate as petrol stations. Stores are owned and operated as franchises, with a central administration.
Stores in Australia sell Slurpees in four sizes—Small, Medium and Large which are served in different colored paper cups, and Super which is served in a clear plastic cup with a dome lid. Stores selling Slurpees have a machine dispensing either two or four flavors—some stores have as many as four machines.
7-Eleven stores sell gift cards including three types of prepaid VISA cards. There are daily newspapers, drinks, confectionery, and snack foods. They sell pre-prepared food such as sandwiches, wraps, pies, sausage rolls under their proprietary brand 'munch' delivered fresh into stores daily.
7-Eleven stores have partnered with BankWest and have BankWest ATMs in all of their stores.
Every year on July 11, one small cup of free Slurpee is given to each customer in honor to Seven Eleven Day. (July is the 7th month which makes it 7/11)
In March 2010, the company ran a promotion where every customer purchasing fuel received a free small Slurpee.
7-Eleven has acquired 295 Mobil service stations in New South Wales, Queensland, South Australia and Victoria that were originally planned for sale to Caltex. Twenty-nine sites in South Australia were subsequently on sold to Peregrine Corporation, to be badged as On the Run convenience stores.[18][19]
On November 8, 2010, a free Slurpee was given to redheads in celebration of Julia Gillard's election.
On September 21, 2011, customers could bring in their own cups (of any sort whether it be from a fish bowl to an esky) and fill it full of Slurpee for only $2.60 (a portion of the price of a Medium Slurpee) as long as it would fit through a cutout hole limiting the size; this however did not stop people from up to and above 5 liters of Slurpee for the price of a Medium Slurpee. This event was known as Bring Your Own Cup Day.
7-Eleven has been operating in the People's Republic of China in cities including Beijing, Shanghai, Tianjin, Shenzhen and Guangzhou, since 2008. Some stores were open since 1996. It offers little or no brand name items like Slurpee. However, they offer a rather wide array of warm food, including traditional items like the steamed, filled bun. Also sold are some beverages, alcohol, candy, periodicals, and other convenience items. As of April, 2009, there were 591 7-Eleven locations in mainland China. Although Beijing locations were originally planned to be open "from 7:00 am until 11:00 pm, to suit the lifestyle of Beijingers",[20] the majority are open 24 hours every day.
7-Eleven, nicknamed "Little 7" (Chat Jai) by the local, has operated in Hong Kong since 1981 under the ownership of Dairy Farm. With most locations being in urbanized areas, approximately 40 percent are franchised stores. In September 2004, Dairy Farm acquired Daily Stop, a convenience store chain located mainly in the territory's MTR stations, and converted them to 7-Eleven stores immediately upon takeover. As of 2009, it has 950 stores and made it a second place for the highest density of 7-Eleven stores after Macau, with 1 shop per each 1.16 km².
Japan has more 7-Eleven locations than anywhere else in the world, where they often bear the title of its holding company "Seven & I Holdings". Of the 39,153 stores around the globe, 12,925 of them are located in Japan with 1,713 in Tokyo alone.
The feel and look of the store is somewhat different from that of the U.S. 7-Elevens. In Japan they offer a wider selection of products and services. Japanese 7-Elevens offer not only food, drinks, and magazines, but also video games and consoles, music CDs, DVDs, digital cardreaders as well as seasonal items like Christmas cakes, Valentine's Day chocolates, and fireworks. Slurpees and Big Gulp super size soft drinks were introduced in the early 1980s but discontinued some years later.
On September 1, 2005, Seven & I Holdings Co., Ltd., a new holding company, became the parent company of 7-Eleven, Ito Yokado, and Denny's Japan.
7-Eleven entered the Macau market in 2005 under the ownership of Dairy Farm, the same conglomeration group operating Hong Kong's 7-Eleven. With only 29.5km², Macau has 45 stores, making it a single market that has the highest density of 7-Eleven stores, with one store for each 0.65km².
Malaysian 7-Elevens are owned by 7-Eleven Malaysia Sdn. Bhd. which now operates 1,212 stores nationwide (as of January 2011). 7-Eleven in Malaysia was incorporated on June 4, 1984 by the Berjaya Group Berhad. The first 7-Eleven store in Malaysia was opened in October 1984, in Jalan Bukit Bintang, Kuala Lumpur. In October 2008, 7-Eleven achieved a milestone opening of its 1,000th store in Bandar Sunway, Selangor. It is today the undisputed market leader in convenience store chain landscape in Malaysia.
In the Philippines, 7-Eleven is run by the Philippine Seven Corporation (PSC). Its first store opened in 1984. In 2000, President Chain Store Corporation (PCSC) of Taiwan, also a licensee of 7-Eleven, bought the majority shares of PSC and thus formed a strategic alliance for the convenience store industry within the area.
In April 2009, 7-Eleven announced plans to expand its business in Indonesia through a Master Franchise agreement with Modern Putra Indonesia (a subsidiary of Modern Group, FujiFilm distributor in Indonesia) of Jakarta. Modern Putra Indonesia's initial plans are to focus on opening stores in Jakarta, targeting densely-populated commercial and office areas, to offer working Indonesians a convenient place to shop for lunch, snacks and emergency items. Other major cities, such as Bandung, Semarang and Surabaya, offer future expansion opportunities.[21]
Indonesian government stated in May 2010 that they will monitor 7-Eleven expansion since it is licensed as convenience store not as mini markets. Indonesian law limits mini market ownership to local companies.[22]
In Singapore, 7-Eleven forms the largest chain of convenience stores island-wide. There are at present 545 7-Eleven stores scattered throughout the country. Stores in Singapore are operated by the Dairy Farm International Holdings, franchised under a licensing agreement with 7-Eleven Incorporated, headquartered in the United States.
The first 7-Eleven stores were operated in 1983 with a franchise license under the Jardine Matheson Group. The license was then acquired by Cold Storage Singapore, a subsidiary of the Dairy Farm Group, in 1989. At present, 7-Eleven plans to expand its base to include 300 stores, within the next few years. In 2006, 7-Eleven (Singapore) signed an agreement with Shell Singapore to operate its "Shell Select" convenience stores in all its petrol stations island-wide.[23] In September 2007, the change-over of Shell Select stores to 7-Eleven were fully completed.[24]
7-Eleven stores in Singapore operate around the clock, except for stores in Biopolis, hospitals, MRT Stations, some shopping centres, Raffles Institution (Junior College), ITE College West, Singapore Polytechnic, Republic Polytechnic and Nanyang Technological University, which have shorter operating hours.
7-Eleven has a presence in the South Korean convenience store market where it competes with Mini Stop, GS25 (formerly LG25), Family Mart and independent competitors. There are 2,282 7-Eleven stores in Korea, with only the United States, Japan, Thailand and Taiwan hosting more stores. Branded products such as Slurpee or Big Gulp is no longer carried in South Korean stores.
In Taiwan, the 7-Eleven is the most popular convenience store, and is owned by the Uni-President chain store under Uni-President Enterprises Corporation. The first store opened in 1980 and since then has grown to cover 4,744 stores as of March 25, 2010.[25] Taiwan has the world's fourth largest collection of 7-Eleven convenience stores after Japan, U.S., and Thailand. With 6,200 potential shoppers per store, Taiwan also has the smallest number of potential shoppers per 7-Eleven convenience store (compared to Japan's 14,946 potential customers for each 7-Eleven and the United States' 48,359 customers for each store). With such a high density of stores, it is not an unusual scene in Taiwan for two 7-Eleven stores to stand face to face across an intersection.
The franchise in Thailand is the CP ALL Public Company Limited, which in turn grants franchises to operators. There are about 6,000 7-Elevens in Thailand, half of which are in Bangkok, making Thailand have the 3rd largest number of stores after the US and Japan.[25] CP All, the operator of 7-Eleven convenience stores in Thailand, plans to increase their number to more than 7,000 stores by 2013. Managing director Piyawat Titasattavorakul stated that the company will invest Bt1.5 billion annually to open at least 500 new 7-Eleven stores in each of the next two years. CP All will also invest Bt1.5 billion this year (2011) to increase the number of 7-Eleven convenience stores from 6,000 currently to 6,300 outlets by the end of 2011. "We expect the total number of convenience stores operated by all players in the Kingdom will increase significantly from about 10,000 today to between 50,000 and 60,000 stores in the next 10 years," Piyawat said.[26]
In Canada, a limited number of 7-Eleven locations have filling stations with gasoline distributed by Shell Canada, Petro-Canada, or Esso. In November 2005, 7-Eleven started offering a wireless service called Speak Out Wireless. They also usually have Canadian Imperial Bank of Commerce ATMs. The first 7-Eleven store to open was in Calgary on June 29, 1969. There were 457 7-Eleven stores as of January 1, 2010.[27] Winnipeg has the world's largest number of slurpee consumers, with an estimated 1,500,000 slurpees sold since the first 7-Eleven opened on March 21, 1970. All 7-Eleven locations in Canada are currently corporately operated.[28]
7-Eleven abandoned the Ottawa market as of December 2009 selling all its six outlets there to regional convenience chain Quickie. Following concerns over the fate of 7-Eleven's popular discount mobile phone plan SpeakOut, Quickie offered to assume existing SpeakOut customers and phones into its Good2Go cellphone program.[29][30]
In Mexico, 7-Eleven was called Super 7. In 1995, the name changed to 7-Eleven. When stores are located within classic buildings (such as in Historic Center) or important buildings, the logo at the entrance shows no colors; instead, letters are golden or silver. Main competitors in Mexico are OXXO (Femsa), Super City (Soriana) and other local competitors.
7-Eleven currently has more than 8,200 owned, operated and franchised stores in the United States-almost all as franchises.[31]
Once ubiquitous, 7-Eleven stores are no longer found in some Midwestern and Southeastern states. In May 1998, it was announced that 113 7-Eleven stores would be sold and converted into Kum & Go stores. In this same time frame, 7-Eleven exited the Minnesota market and sold all its Minnesota stores to SuperAmerica. This led to situations, especially in larger cities like Minneapolis and Saint Paul, where multiple SuperAmerica locations could be found on the same intersection. In states like Minnesota, Iowa, and Wisconsin, other convenience stores like Holiday Station Stores, SuperAmerica, QuikTrip, Kwik Trip, Casey's, and Speedway occupy the same market.
The only independently owned 7-Eleven stores are located in the Oklahoma City, Oklahoma metropolitan area. About 125 stores are owned by the family of William C. Brown (currently run by son Jim Brown) under special arrangement with the company since 1953. William C. Brown's father was a business associate and family friend of John Thompson. "Bill" had recently graduated from the University of Notre Dame and struck out on a quest to find an area "ripe" for the concept. During his travels he met the Tulsa based QuikTrip chain owner who suggested OKC to Brown. Narrowing down the choices he decided upon Oklahoma and opened store No.1 at NW 23rd & N. Portland Avenue in OKC. At their inception the Thompson family were part owners of the OKC stores but never the Corporation. Brown would work a shift at the original store and afterwards would scout new locations to build. The "Oh Thank Heaven for 7-Eleven" phrase was coined by the Stanford Agency the in-house ad agency for 7-Eleven (1954–1981) in 1969. These stores carry a slightly different product selection than other 7-Eleven stores in the U.S. as they do not serve hot dogs or nachos. Instead, they have their own bakeries, called Seventh Heaven.[32] Also, due to this agreement, they carry a non-7-Eleven branded product in lieu of the Slurpee, the Icy Drink, which is not to be confused with the ICEE.[33] The one side effect to this arrangement is that national advertising campaigns and promotions (e.g. movie marketing tie-ins) cannot be used.
In the Pennsylvania market -- a market noted for innovation within the convenience store industry -- 7-Eleven competes with Turkey Hill from Lancaster, Wawa from the Philadelphia area, and Sheetz from Altoona. 7-Eleven has no presence in the Altoona–State College–Johnstown area because of Sheetz,[34] but is predominant in the Pittsburgh region where Sheetz also dominates, as well as South Central Pennsylvania around the state capital of Harrisburg. 7-Eleven is also absent in several cities in Texas (Houston, Galveston, Beaumont, San Antonio - 7-Elevens in these cities after 1988 were sold to National Convenience Stores, which owns the Stop & Go franchise, later purchased by Diamond Shamrock in the late 1990s, now part of Valero since 2006), even though the United States headquarters is based there.[35] 7-Elevens are prevalent in the Dallas-Fort Worth Metroplex, Temple, Killeen, Fort Hood, and Austin, TX (primarily on the Interstate 35 corridor), in West Texas (Midland, Lubbock, El Paso), and two individual franchises in Smithville and San Marcos, TX. The current Texas locations are located north of Interstate 10 and west of the Interstate 35 corridor including the Smithville, TX location east of Bastrop, TX. In North Carolina, 7-Elevens are only seen in the northeastern part of the state, as part of the Hampton Roads market. In the rest of the state, there are several equivalents. 7-Eleven has little to no presence in the Albany, New York market due to the prominence there of Stewart's Shops, a local chain.
In 1987, Southland acquired High's Dairy Stores of Maryland, Virginia, and Washington, D.C., many of which were converted to 7-Elevens.
In March 2007, it was announced that 7-Eleven would sell its corporately-owned stores in northern Texas and in Florida to franchisees;[36] the chain has been franchising stores since 1964. The sale will make 7-Eleven virtually a franchise-only operation in six years.
7-Eleven is moving toward franchising most of its remaining corporate locations inside the United States. The 7-Eleven franchise system splits the gross profits 50/50 or close to it, between the company and the individual franchisee. The initial 7-Eleven franchise term is 15 years. The franchise fee and other upfront fees collected by 7-Eleven from a newly approved franchisee, in addition to ongoing 50:50 sharing of profits, is not transferable to another incoming franchisee in the same store, for the unexpired portion, if any, of the current 15 year contract. For example if one pays full franchise fee for 15 years and has to leave the store after one year due to any reason, they stand to lose the franchise fee for the remaining 14 years of their term.
Supermarket News ranked 7-Eleven's North American operations No. 11 in the 2007 "Top 75 North American Food Retailers" based on 2006 fiscal year estimated sales of $15.0 billion.[37] Based on 2005 revenue, 7-Eleven is the twenty-fourth largest retailer in the United States.[38]
In the United States, many 7-Eleven locations used to have filling stations with gasoline distributed by Citgo, which in 1983 was purchased by Southland Corporation (and 50% of Citgo was subsequently sold in 1986 to Petróleos de Venezuela, S.A. and the remaining 50% in 1990). Although Citgo was the predominant partner of 7-Eleven, other oil companies are also co-branded with 7-Eleven, including Fina, Exxon, Gulf, Marathon, BP, Sunoco, and Pennzoil. Alon USA is the largest 7-Eleven licensee in North America.
On September 27, 2006, 7-Eleven announced its 20-year contract with Citgo was coming to an end and would not be renewed. 7-Eleven Spokeswoman Margaret Chabris said "Regardless of politics, we sympathize with many Americans' concern over derogatory comments about our country and its leadership recently made by Venezuela's president Hugo Chávez. Certainly Chávez's position and statements over the past year or so didn't tempt us to stay with Citgo." Later she said that "People are making it out to be more than it is."[39] Citgo's Chief Executive Felix Rodriguez responded with a correction the following day, accusing 7-Eleven of exploiting the situation to score political points against Chavez, and pointing out that Citgo's decision to terminate the contract with 7-Eleven had been made in July, for practical and economic reasons: "[The reports are] a manipulation because ever since the month of July have we announced that we did not intend to renew a contract with 7-Eleven, which was 20 years old and that was part of a bad business deal for Venezuela."[40] A statement found on Citgo's homepage stated, "The 7-Eleven contract did not fit within CITGO's strategy to balance sales with refinery production after the sale of its interest in a Houston area refinery."
At locations that have already phased out Citgo fuel, 7-Eleven is no longer accepting Citgo's credit cards. 7-Eleven stores that have removed the Citgo sign usually replace it with an "Oh Thank Heaven!" or "Fast and Fresh" sign on the main sign display, and simply place the 7-Eleven logo on the canopy over the pumps.
In more recent years, however, many gas station locations being built have a 7-Eleven, including the acquisition of BP's "Shop" brand on several locations in the New York metropolitan area. 7-Eleven major competitor is Royal Farms.
The owner of the master franchise for 7-Eleven in Scandinavia is Reitan Servicehandel, a part of the Norwegian retail group Reitan Group. All stores are franchised, and 7-Eleven often tries to place the stores on corners in city centers. After Reitangruppen bought the filling station chain HydroTexaco (now YX Energy) in Norway and Denmark in 2006 it has announced that several of the stores at the filling stations will be rebranded 7-Eleven and the petrol will be supplied by Shell, others will remain under the YX-concept.
The first Danish 7-Eleven was opened in Østerbro on September 14, 1993. As of October, 2011, there are more than 190 stores, mostly in Copenhagen, Århus, Aalborg and Odense, including 8 stores at Copenhagen Central Station. In Denmark 7-Eleven has an agreement with Shell, with a nationwide network of Shell/7-Eleven service stations, and an agreement with DSB to have 7-Eleven at most S-tog-stations.
In Norway, the first 7-Eleven was opened at Grünerløkka in Oslo on September 13, 1986. As of October 1, 2010, there are 110 7-Eleven stores in Norway, more than half of these are in Oslo. Norway has the northernmost 7-Eleven in the world, situated in Tromsø. On a per-capita basis, Norway has one 7–Eleven store for every 47,000 Norwegians, compared to Canada, which has one for every 74,000 Canadians.
The first European location of 7-Eleven was Swedish; the first 7-Eleven in Sweden was opened on Tomtebogatan in Stockholm in 1980. Reitan Servicehandel Sverige has the license in Sweden. In the mid-1990s, 7-Eleven in Sweden received adverse publicity, resulting in many stores being sold and closed down. For a time there were only 7-Elevens in Stockholm and Gothenburg. 7-Eleven returned to the south of Sweden in 2001 when a convenience store opened in Lund. As of the end of 2008, there are 77 7-Elevens in Sweden: most of them in Stockholm, 16 in Gothenburg, 8 in southern Sweden (including two in Lund, two in Helsingborg, three in Malmö and one located at Malmö-Sturup Airport). After an agreement with Shell on August 27, 2007, 112 Shell Select-outlets will be remade into 7-Eleven as of April 2009.
7-Eleven has been consistently ranked in Entrepreneur's Franchise 500,[41] most recently being selected as the No.1 overall franchise. In addition, they were also ranked No.38 in Fastest-Growing Franchises[42] and No.2 in Low Cost Franchises.[43] In 2008, 7-Eleven was named the number one franchise by Entrepreneur, beating out Subway, which had held the number one spot for 15 years.[44]
The company's first convenience outlets were known as Tote'm stores since customers "toted" away their purchases, and some even sported genuine Alaskan totem poles in front. In 1945, Tote'm became 7-Eleven to reflect the stores' new, extended hours—7 a.m. until 11 pm, seven days a week. The company's corporate name was changed from Southland Corporation to 7-Eleven, Inc. in 1999.[45]