CASE STUDY: 7- Eleven: Techniques for Success
NEW YORK CITY -- Rick Keyes, chief executive and CEO of 7-Eleven Inc., chatted at Merrill Lynch's Selling Leaders: Home Products and Makeup Conference in New York on Wednesday, featuring the company's powerful transformation of its business model. " We could transforming significantly what was a fantastic business in what we believe can be a superb business with growth options, now that we have fixed the business enterprise model to continue bettering our traditional business while adding new segments like fresh food or providers, " Keyes said.
According to Keyes, proof of success can be evident in the provider's operating figures, namely it is in its thirty fourth quarter of improved same-store sales. The important thing to 7-Eleven's successful version, Keyes explained, has been to enact a centralized organization strategy to leveraging the company's ordering power. " We decided to concentrate all of our stores in geographic areas that let us to aid our shops with a far more effective daily distribution system -- a nationwide network of commissaries, bakeries, fresh foods, facilities in each market, " Keyes said. " So it's a hub-and-spoke program that is drastically different. "
Another successful strategy for the company has been the 12-week teaching programs made to put even more decision-making tools in the hands of retail outlet operators, according to Keyes. " It's a centralized entrepreneurialism that we're trying to create as specific stores help to make individual product decisions, " Keyes explained. " We have technology to have every item, every day, assessed and tracked in eachstore. Yet each of our challenge continues to be the people? supplying our folks the training and tools necessary to make better shopping for decisions. "
Furthermore to its focus on same store-sales, Keyes said a great equally important element of the business version is the business ability to end up being " proactive" by putting into action new products and partnering with manufacturers to extend product life cycles. 7-Eleven harmonizes with manufacturers to evaluate deploy and improve products. The company's latest initiatives, Keyes said, consist of its fresh focus on their fresh foods category and electronic services, such as prepaid phone cards as well as the ability to sell off money requests online. An additional significant project is a partnership with Anheuser-Busch Inc. to develop an light weight aluminum bottle that may eventually be rolled out country wide.
" We all represent syndication opportunities for products, but we also represent a distribution chance for electronic companies now that we now have a network and a telecommunications canal to every shop, " Keyes said. Keyes said that the proof of you’re able to send success is definitely evident in its steady same-store sales raises of 3 to 5 percent, and last year's same-store revenue increase of 5. 3 percent. " We have a much more stable "balance sheet", a constantly improving cashflow and making model, " Keyes stated. " We now have very strong confidence that our technique is operating and that we will continue to be in a position to deliver continuing improvement in same-store product sales and total financial performance. "
There is likely a 7-Eleven store in your neighborhood, and it is a easy place pertaining to picking up a can of Coke or possibly a quick ham-and-cheese sandwich. It's the largest convenience retailer on the globe and the leading convenience retail outlet chain in the us, with 5, 300 retailers. This company began about 75 years ago being a nice-dock user. When fridges started upgrading ice packing containers, the manager of each retail store asked customers one-by-one what items they'd like to stock in their fresh appliances. By asking clients directly and stocking the particular items consumers most wished, the company grew and prospered. Over time, the corporation moved away from its beginnings, losing feel with customers along the way. It had no method of knowing what bought from each store and allowed vendors to determine what to share on the shelves. Although large vendors, such as Coca-Cola and...
Referrals: вЂў http://www.allbusiness.com/retail-trade/food-stores/4484810-1.html
вЂў Porter, Meters. E, вЂќStrategy and the net, вЂќ Harvard Business Review, March 2001.