5 Provide the Market Trends for 7Eleven Franchise 6 Provide

5. Provide the Market Trends for 7-Eleven Franchise.

6. Provide the Market Growth for 7-Eleven Franchise.

7. Provide a SWOT Analysis for the 7-Eleven Franchise.

Solution

7- ELEVEN FRANCHISE

7-Eleven is an international convenient store chain based in Texas. Formerly known as Tote’m Stores, 7-Eleven is spread across eighteen countries.

Market trend of 7-eleven

7-eleven adopts the strategy of introducing private labelled products in its stores. This kind of product differentiation strategy help 7-eleven to beat its competitors when the such products will be exclusively available in 7-eleven stores.

7-eleven has a turn-key business model where the business and marketing strategies are formulated by the top management and individuals could become a part of the business as franchisees.

7-eleven organizes trade shows to introduce new products and recently introduced four brands of coconut water

The company is also planning to resort to mobile on-demand service where the customers will be able to purchase goods through 7-eleven mobile applications. They will receive spot delivery of the purchases. This mobile app will be tested for Dallas stores and will be later introduced to other stores also.

Market growth of 7-eleven franchise

7-eleven is in an expansion mode and it is growing at an exponential rate in countries all over the world. It has adopted a franchisee model for expanding the business. Currently the stores are located in eighteen countries all over the world. Since the stores are open 24*7 at convenient locations, it helps 7-eleven in maintaining a leadership position.

SWOT ANALYSIS OF 7-Eleven

STRENGTHS

Sharing of gross profit with franchisees

Unlike other companies, 7-eleven shares its marginal profit with its franchisees.

Spread across convenient locations

7-Eleven franchise is spread across convenient locations with over 50,000 stores all over the world. These stores provide ease of shopping for the customers.

Brand image

7-Eleven is regarded as a market leader. This helps the store to have a better brand image and earn the loyalty of the customers. This helps the store to have stable revenue from all its outlets.

Umbrella branding

7-eleven also has several products under its umbrella. For example, Movie Quik, Slurpee are the brands of 7-Eleven and they are highly sought after by the customers.

Business model

The business model of 7-Eleven is franchisee which help the company to expand without any initial investment and the expenses are being taken by the franchisees.

Multiple sources of income

Since 7-Eleven is spread across eighteen countries, the income is diversified from different geographical markets. Hence it will be not affect the general flow of income in case of any instability in a location.

WEAKNESS

High infrastructure costs

There are high infrastructure costs associated rentals. Since the stores are to be located in convenient locations, it may incur high costs with regard to rentals. It may be reflected in the price of the products which make price sensitive customers reluctant to make purchases from the stores.

High operational costs

Since the stores are operating 24 * 7, 7-eleven may have to pay high salaries to their employees. This is also another element that may increase the price of the products.

OPPORTUNITIES

Opportunity for further expansion

7-eleven has the opportunities to expand further to new locations where potential to capture the market.

Wide range of products

7-eleven franchisees display a wide range of product offerings and avail services like ATMs and even vehicle insurances.

Strategic tie-ups

7-eleven has strategic tie-ups with manufacturers whose products are available only in 7-eleven stores. For example, variant flavors of Gatorade are available only through 7-eleven stores.

Opportunity for branding tie-ups

7-eleven stores have the opportunity for brand tie-up with coffee chains, pizza outlets etc. in their locations. This will attract more customers to both these stores as well as for the brand partners.

THREATS

Supermarkets

Supermarkets are posing threat to 7-eleven as in many parts of the world supermarkets have extended their operating hours. These supermarkets might pose threat to 7-eleven by affecting the growth of 7-eleven.

Online stores

Flourishing of online stores will also pose threat to 7-eleven as people may prefer to buy products in the convenience of their homes.

Security issues

Security issues and theft have been reported in certain 7-eleven stores as there may not be sufficient staff in certain locations.