7-Eleven Turns Focus to Fresh, Healthier Options
Over the last year, the retailer has introduced a line of fresh foods and downsized some of its fare by creating portion-size items, the New York Times reported. The c-store retailer's goal by is to have 20 percent of sales come from fresh foods in its American and Canadian stores, up from about 10 percent currently, according to a company spokesman.
"We're aspiring to be more of a food and beverage company, and that aligns with what the consumer now wants, which is more tasty, healthy, fresh food choices," said 7-Eleven's President and CEO Joseph M. DePinto.
Consumer trends and demands are changing to focus more on healthier food options, and the convenience store industry has taken notice -- especially in light of increased competition from supermarkets and quick-service restaurants. Fresh foods can also offset losses from a major profit driver in the channel -- cigarettes. Fresh offerings present a significant markup in a fast-growing category, according to the newspaper.
"If you can figure out how to deliver consistent quality and the products consumers want, fresh food is attractive because margins are higher, and it addresses some of the competitive issues you're facing," said Richard Meyer, a consultant for the convenience store industry. "But it's not easy to do."
7-Eleven has been selling fresh food since the late 1990s. But much of its innovation has been limited to the variety of hot dogs spinning on the roller grill or the breakfast sandwiches beneath a heating lamp, according to the news report.
To help with its focus shift, 7-Eleven has put together a team of culinary and food science experts to study industry trends and develop new products.
"We're working to create a portfolio of fresh foods," said Anne Readhimer, senior director of fresh food innovation, who joined the company in May from Yum Brands, where she had worked on the KFC and Pizza Hut brands. "Some will be for snacking, some for a quick meal, but we hope everything we offer our guests is convenient and tasty."
In addition to adding new items to the menu, the Dallas-based retail chain is revamping existing products. For example, customers can now buy jelly doughnuts and tacos in mini sizes.
"There are definitely customers who want healthy options, but there are also lots of customers who are excited about the new sandwich options that aren't low calorie -- and mini-doughnuts are doing very well," said Lori Primavera, senior manager of fresh food innovation at 7-Eleven, who previously worked for Food and Drink Resources, a consulting firm for restaurant companies.
7-Eleven operates, franchises and licenses approximately 8,030 stores in the United States and Canada.