Seven - Eleven

Japan
Group 8
Oltean Patricia

Opoku-Darkwa Karen

Panova Svitlana

Siddharth Choudhary

Shen I-Pai
 Background & History
Type: Retail (Convenience Stores)
1927: Founded in Dallas , Texas as Southland Ice
Company
1946: Renamed as 7-Eleven
1963: 24-hours stores established.
First Southland Ice Company store 1927
1974: Japan’s first 7-Eleven store in Tokyo
2005: Became subsidiary to Japanese owned
company Seven & I Holdings Co.

First 7-11 store in Japan, Tokyo

One of the 7-11 in Japan today

 7-11 Around the World

Far East
Japan 12,771 Rest of the World
China 1,696 Australia 406
Indonesia 8 Canada 458
Malaysia 1,142 Denmark 121
Philippines 493 Mexico 1197
Singapore 512 Norway 176
South Korea 2,449 Sweden 191
Taiwan 4,722 U.S.A 6579
Thailand 5,511
Total: 9128
Total: 29304
(as of June 30, 2010)
 Convenience
Definition
 State of being able to proceed
with something without difficulty
 Quality of being useful, easy or
suitable for someone
 A thing that contributes to an easy
and effortless way of life
Oxford Dictionary

In terms of Convenience Store Retailer

Sample layout of a typical Japanese convenience store

Everything in One Place

7-Eleven In-Store Services

 Copy/fax/scan
 Digital Prints
Ticket Purchase
(cinema/sports/exhibition/concert/holiday/theatre etc..)
 Prepaid Service (Game/Music/Mobile top-
up/International Pre-paid cards etc..)
 Prepaid for Air Tickets
 Bicycle Insurance
 Pay for Yahoo Auctions
 Pay for Bills
 Postal Service
 7 Eleven Bank
 Delivery
 4 Rules to Increase Consumer Loyalty

Product Assortment Cleanliness

Products are displayed to So that customer can shop in
entice the customers comfort, quickly and easily

Friendly Customer Service Freshness

Greeting every customer and Constant fresh produce,
serving with a smile supported by RIS
 Porter’s 5 Competitive Forces
Threat of New Entrants
 Local Franchise
 Established Retailers from the
“Convenience” Shopping Market
 Super Markets (Circle K)

Major competitors
Other competitors

Bargaining Power of Bargaining Power of

Suppliers Buyers
 Cheaper Manufacturers  Customers outside of
 Local/Foreign Produce the region?
 Customers with ethical
relationship with oriental
way of consuming

Substitute of Products and

Services
 Internet
 TV Sales and Advertising
 Strategy of 7-Eleven
Main concepts: Customer satisfaction & Innovation

The Organisation of the Franchise

 Grant licenses to franchisees to use its name and trademark
 Provide management know-how and management information to
franchisees
 Employs ‘operational field counsellors’ & specialists to help franchisees
Strategy - Market Dominance
 40-60 stores in small geographical area
 Increase brand awareness
Gain competitive advantage
High distribution efficiency Two 7-11 stores at the same
intersection
Decrease in supply costs
 Distribution System I

 Priority of manufactures’
convenience
 Products are sold only to the
wholesales belonging to the group
 Delivery vehicle carries the
products of only one supplier at a
time

 Mixing goods from different

suppliers
 Small unit ordering and delivery
system
 Avoiding the overstocking
 Easier to follow customers’
changing demands

Source: Kunitomo: 1997

Distribution System II
 ‘Combined delivery system’

 Utilizes temperature-controlled
vehicle to carry different items

 Loading capacity of each

vehicle has been developed

 Products are divided into four

different temperature zones:
- frozen foods
- chilled foods
- hot foods
- processed foods

 The frequency of the deliveries

is determined by their
temperature

Source: Seven & I Holding Co. Ltd

Total Merchandising

Source: Kunitomo 1997

 Company Synergy

Communication within the company

 Weekly meetings
 Data collected in store regularly sent to
headquarter
 Data studied & analysed  company
strategy developed
 Role of individual member of staff is
central to the business

7-Eleven Japan continues moving forward in its role as a distribution group that
can respond to customer expectations through continuous innovation and group
synergies
 Factors Contributing to the Success of 7-11

Information Technology
 Partnership with NEC and Microsoft allowed the introduction of a tailor made
information system
 The system brought forward a series of innovation and eliminated certain
inefficiencies
i.Orders to flow quicker, hence enhancing the efficiency of the supply chain
ii.Use sales data and software to improve quality control, pricing, product development
iii.Predict daily trends
iv.Monitor the consumers’ need

One of the NEC’s Point of sale system used in 7-11

 Factors Contributing to the Success of 7-11
Innovations
 Introduction of New Products, Supply Chain Management and Sales Process

Examples

Chilled Vegetable Juice Oven Fresh Bread

 Product: Ball-shaped frozen
vegetable juice- a fusion of vegetable
juice by Kagome and ball shaped ice-
cream by Ezaki Glico
 Supply Chain: A retailer collaborating
with two manufacturing companies each
with different capabilities
 Supply Chain: Delivery 3 times a
day without increasing costs through
collaboration between a manufacturer
and a retailer
 Sales Process: Use convenience
store as a new channel for an
exclusive fresh oven bread
 More Examples of Innovations

Nissin Food Products "Goo-Ta" Ito En Ltd’s “Ooi-ocha”(Big-Tea)

 Product: Instant cup noodles with  Product: Various and unique
many ingredients flavours of tea in plastic bottle
 Sales Process: Dynamic  line-up of  Sales Process: Offering a dynamic

variations, introducing one new line-up of variations consisting of a

variation a month to the market and staple product and its variations with

maintaining 5 to 6 variations of the planned short life cycles that

brand at a time (unlike "Ooi-ocha" it collectively gives a refreshing

impression on a brand and shelf.
does not have a staple product).
Customer Profile of 7 Eleven
Strategies for 7-11 to Build More ‘Life Infrastructure’
Homage Service to Senior Citizens
Why?
 Due to the increase in aging population
How?
 Personal home visit service to understand the needs of individuals
 Take orders and deliver the goods

Care Women or Hire Men

Why?
 Due to the ‘Retired Husband Syndrome’ in women and
the ‘Take Me With You Horror’ in men
How?
 Provide special ladies’ discount hours service
 Provide jobs for retired/jobless men
Strategies for 7-11 to Build More ‘Life Infrastructure’
Show Ticket Take Discount
Why?
 Reduce road traffic
 Reduce air pollution
How?
 Get discounts and/or free home delivery service when showed proof of public
transport use on that day itself

Save Bento Culture

Why?
 Due to lower nutrition values in children’s lunch meal box
 More instant meals for children due to increase working
women
How?
 Reinvent ready-made nutritious Bento for school children
Strategies for 7-11 to Build More ‘Life Infrastructure’

Remind Japanese their Invention

 Macrobiotic Food (known as ‘Anti-Cancer Food’ ) used to be very
popular in Japan
Therefore, 7-11 could :
 Re-promote and provide more of this kind of food in stores Macrobiotic food beans

 Have more macrobiotic food properties in other food products at

more affordable prices

No Stop Shopping Ready-made macrobiotic food Macrobiotic food seeds

Provide more convenience for customers

by
Order & Pick up service
 Anytime order and pick-up service upto
customer’s convenience
 Conclusion

 7-11 prides themselves by delivering transaction convenient element

 The company adapt and adopt strategies to customise tailor to fit organisations needs
 7-11 was able to modernise the convenience store by using a tailor made information
system, continuous innovations and always placing  high priority on the community and
its culture
 7-11 continues moving forward in its role as a distribution group that can respond to
customer expectation through continuous innovation and group synergy

Information and Emotional Appeals: Using strategy known as “Demonstration”

information based messages.
http:// www.youtube.com/watch?v=zIkSAT5ykRw&feature=related
Thank You !
Questions ?