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This document presents a case study comparison of the business models of Taiwan 7-Eleven and Shanghai 7-Eleven. It first provides background on the global and Taiwan retail industries and introduces Taiwan 7-Eleven's model, which focuses on logistics, supply chain management, and partner management. It then covers China's rapidly changing retail industry and describes Shanghai's market. Shanghai 7-Eleven's late entry led it to focus on a central kitchen, resource sharing between partners, and effective customer segmentation. The document concludes by comparing the two models side by side.

Business Technology

Business Model for Differentiation:
Case Study Taiwan 7-Eleven and
Shanghai 7-Eleven
Graduate Student: Jeremy Firster
Advisor: Dr. Jung-Chuen, Lin

Presentation Outline
Part I
1. Global Retail Market
2. Taiwan Retail Industry
3. Taiwan CVS Industry
4. Taiwan 7-Eleven
2
Part II
1. Chinese Retail Market
2. Shanghai Retail Market
3. Shanghai CVS Market
4. Shanghai 7-Eleven
5. Business Model
Comparison

Retail Formats – Customer Needs
(Page 30-31)
4

Highest Retail Growth in Asia
(Page 30)
5
Global: Retail Sales Growth by Volume (%)
Global: Retail Sales by Value (US$ trillion)

TAIWAN RETAIL INDUSTRY -
MATURE MARKET
Competitive Structure
6

Taiwan Retail Structure
(Page 32-34)
7
Market
Share (%)

Taiwan Retail Structure (2)
• Highest Density of Convenient Stores in the world
• 50% of retail value
(Page 32-34)
8

CVS Industry Characteristics
Mature
Market in
Asia
(30 years)
46%
Increase in
Sales
(2010-2015)
High Level of
Vertical
Integration
Similar
Strategies
(Page34-36)
11

TAIWAN 7-ELEVEN
Overview
Business Model
Discussion of Critical Elements
12

Supply Chain and Logistics
Management (Hyper-Efficiency)
(Page 47-48)
17
FMCG Partners
• Economies of
Scope
Distribution
Centers
• Economies of
Scale
Store Locations
• Convenience

Information Systems Management
Tracking Customer
Preferences
Order Information for
Supply Chain
Management
Franchise Management
(Utilization)
Innovation Management
(Implementation)
Information
Systems
(Page 50)
18

Innovation Management
Meeting
Customer Needs
• Understanding
Changes
Increasing Same
Store Sales
• Leverage Channel
Management
Utilize Data
• Information Systems
• Franchise Source
• Emergent Sources
(Page 50-51)
19

CHINA’S RETAIL INDUSTRY
Dynamic Changes
22

Mixed Retail Format Development
(Page 56-57)
25

China’s Retail Structure
Trade Sector Store Numbers China Retail Format Market Share
(Page 57-58)
26

Drivers of China Retail Growth
(Pages 58-60)
27

Drivers of China Retail Growth
(Pages 58-60)
28

Drivers of China Retail Growth
(Pages 58-60)
29

SHANGHAI, CHINA
Golden City of Opportunity
30

Fast Facts: Shanghai
Largest
Economic Hub
Largest
Transportation
Hub
2020: 36%
Global Retail
Sales
70%
Population:
18-59
30% Regional
Immigrants
(Pages 60-61)
31

Shanghai Convenient Store
Industry
(Pages 61-67)
32

7-Eleven as a late entrant
• Uni-President China
Developments since
1992
• Licensing issue with
parent company,
Seven & I, lasting
until 2008
• Late market entrant
• Entry with “fast-food
island”
(Page 67-70)
34

Market Entry - Segmentation
• President Hsu
• “My competitor my
customer”
(Page 40)
35
80% Eat
Meals
Outside
Home
54% Target
Customers:
2-4 visits
Breakfast:
16%
Lunch:
11%

Business Units
• Social
Networks
• Economies
of Scale
• Maximum
Utilization
• Market
Knowledge
Local
Partners
Resource
Sharing
Public
Relations
Supply
Chain
and
Logistics
(Page 76)
37

Central Kitchen
$
Centralize
Production
Key Element of
Strategy
(Page 77)
38

Public Relations
Stakeholder
Management
Managing Legal
Restrictions
Hiring
Employees
(Page 78)
39

Business Model Comparison
Taiwan 7-Eleven Shanghai 7-Eleven
(Page 79-82)
41

Business Model Comparison
Taiwan 7-Eleven Business Model
42
• Logistics and Supply
Chain Management
• Mature Industry
• Partner Manager
• Resource Allocation
• Enhanced Segmentation
• Super Channel

Business Model Comparison
Business Model Shanghai 7-Eleven
(Page 79-82)
43
• Central Kitchen
• Managed Partner
• Resource Sharing and
Creating
• Effective Segmentation
• High-End Channel

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