7-11 - WDCEP

Report
7-Eleven Food Stores
2010
0
Our Beginning...1927
The Convenience Concept
Give the customers what they want,
when and where they want it.
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Global Brand Strength
...the Largest Convenience Chain in the World
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Do you have what it takes?
7-Eleven Franchisee Attributes
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Hiring and supervision experience
Capable of building infrastructure and developing
an English speaking sales team in addition to the
language of the local community
Ability to implement company programs &
strategies to maximize sales and profits
Ability to adapt to market and company changes
Strong financial savings, portfolio, credit rating for
the investment
Desire to work with people and support the local
community
Desire to work within a controlled franchise
system
Embrace the 7-Eleven fresh food model
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7-Eleven Business Model / Retailer Initiative
Customer Satisfaction
“The Customer”
Services
“Financial Convenience”
Technology
“The Core”
Retailer Initiative
“Item-by-Item”
Fresh Food
“Portable Fresh Food”
Demand Chain
“Daily Delivery”
Team Merchandising
“Product Innovation”
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Your Investment
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One time Franchise fee
One time Gasoline fee (if applicable)
Down payment on initial inventory and supplies
Initial cash register fund
State and local licenses, permits and bonds
Goodwill (if applicable)
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The Financial Picture
Net Merchandise Sales
Cost of Goods
=
Total Gross Profit
Your Share of
Gross Profit
7-Eleven’s Share of
Gross Profit
- Less expenses
- Less expenses
= Your
Net Income
= 7-Eleven
Net Income
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Your Responsibilities
 Payroll, Payroll Taxes
 Workers Compensation Insurance
 Business & Inventory Taxes
 Cash & Inventory Shortage
 Your share of Credit Card Fees
 National Advertising Fee
 Business Licenses & Bonds
 Interest Expense
 Telephone
 Janitorial & Laundry
 General Maintenance & Upkeep of Store Equipment
 Common Area Maintenance
 Store Supplies
Share of Gross Profit – Expenses = Your Net Income
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7-Eleven’s Responsibilities
 Land, Building, Equipment, Rent & Property Taxes
 Utilities (water, gas, electric, sewer)
 Record Keeping
 Quarterly Audits
 Individual Contractual Indemnification
 Building Maintenance & Repairs
 Business Consulting
 POP/Advertising Materials
 Market Research & Product Selection
 Price & Vendor Recommendations
 Ongoing Store Support Services
Share of Gross Profit – Expenses = 7-Eleven’s Net Income
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The 7-Eleven Franchise System
• 7-Eleven offers two types of Franchise systems:
Traditional and Business Conversion Program (BCP)
– Under the Traditional Franchise Program, 7-Eleven incurs initial and
ongoing costs of the land, building and equipment and leases a turnkey
business to the Franchisee
– The Business Conversion Program allows property owners to
maintain control of their real estate while taking advantage of the 7Eleven Business System
• The BCP Franchise program is designed to
accommodate stores with or without gas
– The program focuses on optimizing merchandise gross profit; 7-Eleven
does not share in your gas business
Business Conversion Overview
What is BCP?
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Is a means of new store development
Provides opportunity for independent
convenience store operator to convert
their operation to a 7-Eleven franchise
Both parties invest in remodeling &
updating store to 7-Eleven image
Allows independent to obtain all the
benefits of 7-Eleven (Brand, Services,
Merchandising, ETC.)
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Qualifications
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Qualification the same as traditional but
must also:
– Qualify as a business owner
– Have a site that qualifies for a 7-Eleven
– Current 7-Eleven Franchisees must qualify via
the Multiple Store Guidelines with various
levels of Management approval
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Site Standards
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Store size conforms w/ability to deliver
business system
– At least 1800 square foot selling space – less
must qualify under an exception process
– Business system = daily delivery of fresh
food, night time deliveries
– Must be a 24 hour x 7 day operation
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Conflicts will be evaluated on case by
case basis
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Franchise Fee and Deposit
•Due at agreement signing
 $25,000 initial Franchise Fee
 Deposit of $25,000- $40,000 depending
on type of conversion. (existing c-store
with inventory, non-existing c-store,
major development)
$35,000 minimum net worth
maintained at all times
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7-Eleven Charge
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Gross profit based royalty
– No charge for the first 3 months
– Thereafter, 25%
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Add 2% for certain business arrangements
– Alcoholic beverages in Maryland
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Benefits of Franchising a 7-Eleven
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Name Recognition
Established Business System
A Leader in Support & Training
Daily Distribution of Fresh Foods
Leader in Technology Innovation
Continual Operational Support
Over 80 Years of Business Experience
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