7-Eleven Franchisees From U.S. & Japan Meet to Share Information

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7-Eleven Franchisees From U.S. & Japan Meet to Share Information

09/24/2019
NCASEF

IRVING, Texas — Members of the executive board of the National Coalition of Associations of 7-Eleven Franchisees (NCASEF) are holding a series of meetings with Japanese franchise owners in Tokyo.

The Japanese franchisees are pressing for a change to the 24/7 convenience store culture due to shrinking profits and a lack of substantive communication from corporate leadership, according to NCASEF.

"Our association has maintained communication with several leading Japanese franchisees over the past couple of years and they invited us to Tokyo so we can share information and ideas. 7-Eleven operators in the U.S. are struggling with many of the same issues," said Executive Vice Chairman Michael Jorgensen. "Like us, they love the brand but are frustrated with their situation."

Along with Jorgensen, NCASEF Vice Chairman Rehan Hashmi and Treasurer Jaspreet Dhillon are attending the meetings.

Japan currently faces a serious labor shortage. Along with the 24/7 operation status, Japanese franchisees are reportedly concerned by losses from food waste as 7-Eleven's parent company, Tokyo-based Seven & i Holdings, emphasizes fresh food and hot food, as such products have higher labor costs and potentially create losses due to food dosposal.

"We know that encroachment is also a major problem in Japan," stated Hashmi, a Chicago franchisee. "Japan's convenience store market is saturated. Franchisees face growing competition for sales — sometimes from other 7-Eleven franchisees who have been sold a store in close proximity to another. Franchisees have complained about the practice but tell us the company has been ignoring them."

The series of meetings comes soon after NCASEF claimed that corporate actions are causing franchisees to leave the system, prompting a glut in available stores in the U.S., as Convenience Store News previously reported.

7-Eleven is Japan's top c-store chain, with more than 21,000 locations in the country.

"[The] experience and treatment of 7-Eleven franchisees in Japan closely mirrors the challenges faced by 7-Eleven franchisees in the United States," wrote NCASEF General Counsel Eric Karp in a letter to the Japan Fair Trade Commission, which is investigating the country's c-store industry. He noted that "there is a substantial disparity in economic and legal power between franchisors and franchisees."

"By strengthening our alliance with Japanese franchisees, we are sending a message to 7-Eleven that they can't ignore us," said Dhillon, a Los Angeles franchisee. "At the end of the day, we want the same thing. We want the 7-Eleven brand to be successful and we want to be personally successful. We need to work together to make that happen."

NCASEF is comprised of 41 Franchise Association members who represent more than 4,400 7-Eleven stores in the U.S.

Irving, Texas-based 7-Eleven operates, franchises and/or licenses more than 69,000 stores in 17 countries, including 11,800 in North America. The company ranked No. 1 on the 2019 Convenience Store News Top 100 ranking.