Why U.S. 7-Elevens Are Adopting Japan’s Playbook

About this video

• Video Title: Why U.S. 7-Elevens Are Adopting Japan’s Playbook
• Channel: CNBC
• Speakers: N/A (No speaker names provided in the transcript)
• Duration: 00:08:44

Overview

This video discusses the challenges faced by 7-Eleven in the U.S. market, including a declining reputation and financial underperformance, and how the company plans to transform its U.S. stores by adopting strategies from its successful Japanese counterpart, focusing on an enhanced in-store experience, particularly with food offerings.

Key takeaways

• Reputation Issues: U.S. 7-Eleven stores are perceived as having a "dirty feel," dingy lights, and unappealing food offerings, contrasting with the successful Japanese model.
• Financial Struggles: Seven & i Holdings, the parent company, has faced disappointing financial results, with shares falling and a significant acquisition bid being withdrawn. The North American market, primarily the U.S., has seen underperforming stores and declining sales and traffic.
• Strategic Shift: The company is aiming to transform U.S. stores to be more like Japanese 7-Elevens, emphasizing food as a key component of the in-store experience and planning to open numerous new food-focused locations.
• Challenges to Transformation: Implementing changes in the U.S. is complicated by the franchised nature of most stores, intense competition from other convenience chains that excel in food offerings, and the general evolution of consumer needs and the retail landscape.
• Leadership and Future Plans: The appointment of the first non-Japanese CEO signals a commitment to change. Plans include a potential IPO in 2026 to raise capital for upgrades and store expansion, and a focus on food innovation, such as introducing Japanese staples like egg salad sandwiches and expanding fresh food manufacturing facilities.