Welcome! Thank you for spending your precious time with us today. Introduction Housekeeping
While there are many convenience stores today, the industry’s roots lie with 7-Eleven. In 1927, the first convenience store was born from an ice dock. With refrigeration, came a decrease in the demand for ice. An innovative employee began selling milk, bread and eggs on evenings and Sundays when other retailers were closed. Customers wanted more food products and the products they asked for were added, again responding to the customer’s requests and needs. Customers were grateful for the convenience. 7-Eleven’s founders based their business model on the saying “Give the customers what they want, when and where they want it.” Thus, the convenience concept began. And today…………(next slide)
…and today, 7-Eleven is the largest convenience store chain the world. Our franchise system is founded on a well-recognized global system.
Our vision is to be the best retailer of convenience.
Our entire business is built upon the guest and everything we do is in an effort to serve our guests. All of the individuals in the company support the stores so the stores can meet the needs of our guests. Each Guest spends $600 per year! We are a franchise company and there is an extensive network of support in place to assist and support you as you work directly with your guests.
Store Operations revolve around our 5 fundamentals. Which do you think is most important from a guest perspective? Assortment – always in stock – topsellers.
7-Eleven’s Focus is Fresh Foods. Food service is a Trillian $$ industry. Cigarettes is a $40 Billion $$ industry. We are positioned to deliver quality fresh food 24 hours a day.
Important that you understand the importance food service sanitation and safety procedures. Your responsibility is to cascade that training down to your team. Staff appearance also very important when trying to grow food sales.
All stores are equipped with a state of the art information system – part of the equipment package. Ordering and reporting system. Helps you maintain a balanced inventory – identify top sellers and delete dead items. Payroll Accounting – You don’t need a business accountant!
For more than 50 years 7-Eleven has received numerous awards and recognition.
Talk about 7-Eleven’s differentiation and why it is always ranked high in the industry (growth opportunities for franchisees, infrastructure, customers first, lots of corporate support, new initiatives).
In House financing available for Fee only – 9-12% interest rate. Book Inventory determined the day of Changeover – 7-Eleven finances at 5.25% interest rate or prime + 2.
Now let’s take a look at the financial picture: Most franchise systems require royalty payments based on a percentage of sales. However, You and 7-Eleven , Inc. both have a stake in the store’s profitability. If you are profitable, we are profitable! Since we share in the Total Gross Profit $$ - you must purchase 85% of your inventory from recommended vendors – explain.
7-Eleven, Inc.’s gross profit share is called the 7-Eleven Charge.
If needed: Definitions: Net Merchandise Sales includes all product sold inside the store including all commission sales. Cost of goods is defined as the cost of all product purchased from a vendor for resale, the cost of all supplies used in the resale of the product, minus applicable discounts and allowances received from the vendor.
Example of how the Royalty on Gross Profit works: As gross profit grows, the 7-Eleven charge may increase , but only on the incremental gross profit dollar increase.
Your Net Income depends on how well you: Satisfy your customer needs, Implement 7-Eleven operating principles, Recruit and develop top-rate customer focused staff who can effectively communicate with the guests, And monitor your sales trends while managing your expenses.
From your percentage of the GP split, you have the following responsibilities as part of the 7-Eleven System…
7-Eleven uses their share of the GP$$ to help you build your business by reinvesting in the Business System.
#1 – Turn Key Operation when you franchise. #2 – Most Trusted Brand in convenience with the most known Iconic products - Slurpee #3 – Training and Ongoing Support #4 – Weekly Field Consultant Visits #5 – Supply Chain that delivers fresh food every 24 hours #6 – State of the Art Computer/Information System – Reporting and Reports #7 – Advertising Support
7-Eleven, Inc.’s share of Expenses
Discuss Next Steps
Transcript of "Franchising | Entrepreneur Roadmap | 7 Eleven"