Glenn, did you know that 7-Eleven has 19,500 stores, 32,368 employees, 1999 revenue of $8.35bil, and had a 1999 PROFIT of $83.1 mil?
Yet Bezos could buy 7-Eleven with just one of his shares!!
Btw
7-Eleven is getting into E-Commerce too.
Have a nice weekend...Brrrr, its cold in your neck of the woods.;-)
Full disclosure. I bought 7-Eleven stock about 8 years ago...and haven't sold a single share.
>SEVEN ELEVEN JAPAN LTD ADR(SVELY)
Bid: 0 BidSize: 0 Open: 0
Ask: 0 AskSize: 0 Close: 111.00
Last: 113.00 High: 113.00 Div.: 0.370
Change: +2.00 Low: 110.00 Yield: 0.33
A.High: 179 P/E: 0 Volume: 2700
A.Low: 38 1/2 EPS: 0 Market :OTC
Tick: Down
>April 8, 2000
The company that opened the world's first convenience store 73 years ago is reinventing itself.
7-Eleven Inc. always will be a place to buy smokes and beer, gas and Slurpees, but it's sprucing up its stores, adding automated banking kiosks and a decent wine selection, and trying to raise the standards of dashboard dining.
Just a few years ago, its menu was limited to stale sandwiches. Today, the nation's biggest chain of convenience stores touts its sandwiches as being made daily. And during the next few weeks, it will introduce a host of menu items from fruit cups to IncrEdibles, a line of heat-and-serve concoctions -- such as scrambled eggs with cheese and sausage -- that you push out of cardboard tubes.
The company's strategy is working.
Sales at U.S. convenience stores that have been open at least a year rose 9.1 percent last year -- the biggest annual increase in more than a decade.
Overall, profit was up 12.2 percent in 1999 to $83.1 million. Sales increased 13.7 percent to $8.3 billion.
After a decade spent recovering from a leveraged buyout, a bankruptcy and a bailout by its Japanese partners, 7-Eleven is now expanding.
The company, formerly called Southland Corp., didn't add a single outlet to its U.S. store count for a decade. But it has opened 450 in the last two years and will add an additional 165 by year's end.
One of the company's most aggressive campaigns will focus on the store's sandwich case, called the Fresh-to-Go Market. In a test market in Florida, the company recently began making its sandwiches with Kraft cheese and Oscar Mayer and Louis Rich luncheon meats.
If the move boosts sales, it will be rolled out at 7-Elevens nationwide.
The switch to brand-name meats is part of a broader strategy to attract more people during lunch hour -- especially women.
Men still account for about two-thirds of 7-Eleven's sales, but company officials estimate the number of female customers has about doubled in the past 10 years.
7-Eleven also has tried to attract women by adding gourmet coffee, bagels, pastries and child-friendly foods.
This spring, for example, its stores will start selling Smucker's Uncrustables -- peanut butter and jelly sandwiches with the crusts removed for picky eaters.
7-Eleven stocks about 30 wines, including a pair of private labels -- Henri Vernier chardonnay, and Tailon merlot and cabernet, which feature a 7-Eleven logo on the cork -- and it has also added pricier labels such as Kendall-Jackson and Beringer. The stores also stock the decidedly upscale Wine Spectator magazine.
"We don't just sell Boone's Farm," one of the cheapest labels on the market, said merchandise manager Michael Blair.
"We doubted we'd be able to sell it," Blair said of the wines, but sales are up from fewer than 100 bottles a month to as many as 300.
The company, based in Dallas and now owned primarily by Ito Yokado Co. Ltd. and Seven-Eleven Japan Co. Ltd., is smart to reach out to a wider market, said Dennis Telzrow, an analyst at Hoak Breedlove Wesneski & Co., a Dallas investment firm.
"Let's face it, the cigarette category isn't growing, and on the beer side, there's not a huge growth market, so gourmet food's been a big hit for them," Telzrow said.
Not that 7-Eleven has forgotten its core market.
One of the changes talked about was a new display for cigarettes, which account for about 20 percent of sales.
Tobacco products used to be stored in a rack overhanging the checkout, said Tom Bonfiglio, 7-Eleven's manager for tobacco products.
Several months ago, the company moved all tobacco products to shelves behind the cashier.
One reason for the move was to make it easier for customers to see what was available, Bonfiglio said. It was hard for people standing at the checkout to see what was in the overhead rack.
But another reason was to improve store security: The overhangs made it harder for cashiers to spot shoplifters and hindered police officers' ability to see inside the store during their patrols.
The change also helped give stores a cleaner, less cluttered look, Bonfiglio said.
That's been one of 7-Eleven's goals for a while, said John Harris, the company's vice president for Florida.
"People are tired of dirty (convenience) stores," Harris said.
Toward that end, the company has refurbished most of its stores, giving them bigger windows and brighter lighting -- changes that, like removing the cigarette overhang, have improved security and, not coincidentally, helped attract female customers.
In coming years, 7-Eleven will try to widen its customer base even more by adding e-commerce services.
It has been testing automated financial services at several Texas stores for about a year. The tests involve kiosks, operated by American Express, that let people cash checks, buy money orders and wire money.
Eventually, said Clark Matthews, 7-Eleven's president and chief executive, 7-Eleven will offer more extensive e-commerce services -- for example, letting people order products such as clothing or compact discs from a variety of vendors and then pick them up at the closest 7-Eleven later the same day.
This kind of service would capitalize on the company's network of distribution centers, which were put in place primarily to deliver fresh foods to the convenience stores, he said.
Such initiatives would put 7-Eleven well ahead of its competitors, said Telzrow, the stock analyst.
Some people are shocked to imagine that a convenience store could be "acting as if it were in the 21st century," he said, "but they spent a lot of time getting to where they are now." |
