FRANCHISE FEASIBILITY STUDY

Executive Summary
1. Company Name
2. Type of Business
3. Company Description
4. Key Personnel

 Organizational Chart

5. Start-Up Schedule and Competition

6. Funds Requested
7. Funds Use Statement 
8. Fund Repayment
Marketing
· Major marketing objectives
· Market plan and pricing strategy
Marketing Mix of 7-Eleven analyses the brand/company which covers 4Ps (Product,
Price, Place, Promotion) and explains the 7-Eleven marketing strategy. There are
several marketing strategies like product/service innovation, marketing investment,
customer experience etc. which have helped the brand grow.
Marketing strategy helps companies achieve business goals & objectives, and
marketing mix (4Ps) is the widely used framework to define the strategies. This article
elaborates the product, pricing, advertising & distribution strategies used by 7-Eleven.
Let us start the 7-Eleven Marketing Mix & Strategy:
7-Eleven Product Strategy:
The product strategy and mix in 7-Eleven marketing strategy can be explained as
follows:
7-Eleven is a convenience store located worldwide. The 7-Eleven store is known for
offering one stop location for fulfilling its customer’s need. The product line in the
marketing mix of the company can be divided into food and drinks for breakfast, lunch,
evening snack, dinner and late night snack. The company offers:-
• Sandwiches: Some of the famous offering in this segment are classic cheese burger,
cubano melt, double bacon cheddar melt, chicken bacon ranch melt sandwich and
many more. There are 16 different sandwich that the store offers.
• Salads, pizzas, Taquitos are also offered by the brand
• Snacks and sides: Some of the famous offering in this segment are chicken tenders,
7-Select Potato Chips, 7-Select GO!Yum Kettle Popcorn and many more.
• Bakery: Some of the famous offering in this segment are Fresh Brownies, 7-Select
Cinnamon Roll, 7-Select Iced Danishes etc.
• Ice cream: Some of the famous offering in this segment are 7-Select Strawberry
Crunch Bar, 7-Select Cookie Ice Cream Sandwich etc
• Gas: 7-Eleven was the first store to sell gas for cars etc.
• Wireless accessories and personal care products like Connect by 7-Eleven
Powerbank, 7-Select Comb & Pik Set etc.
7-Eleven Price/Pricing Strategy:
Below is the pricing strategy in 7-Eleven marketing strategy:
7-Eleven stores keep the price of items as competitive with respect to other stores.
The generic items includes brand sold on every convenient store like coffee, chips,
bread, eggs etc. But for its privately labelled products like Slurpees, Big Gulp etc the
pricing is a bit higher. The reason for increased pricing for its private labelled products is
simply because these product are liked by its customers and are exclusively available at
7-Eleven stores only. Moreover as the store offers one-stop shopping solution for all the
needs of customers and the time length (7 am to 11 pm and some stores are opened for
24 hours also) at which the store operates, the customer are happy paying some
premium pricing for the offering made by 7-eleven stores. This gives an insight in the
marketing mix pricing strategy of 7-Eleven stores.

7-Eleven Place & Distribution Strategy:

Following is the distribution strategy of 7-Eleven:
7-Eleven stores was started in Dallas,Texas in the year 1927 but by the end of 1950s
the stores were spread to Florida, Maryland, Virginia and Pennsylvania. In the year
1969 the company crossed international border and launched stores in Canada and
currently the company has about 60,000 stores spread across 18 countries. The
company also provides its franchise to potential owners which can be applied directly
from 7-Eleven website. In order to better serve its customers, the 7-Eleven company
has come up with 7-Eleven mobile app which caters to the needs to internet friendly
generation of customers. Through the app the 7-Eleven stores are able to better serve
customers by delivering food, paying bills online, give reward points to customers etc.

7-Eleven Promotion & Advertising Strategy:

The promotional and advertising strategy in the 7-Eleven marketing strategy is as follows:
7-eleven stores follow an Omni-channel approach for its promotional strategy from digital
promotion to events to physical store sites promotion. The 7-Eleven company is engaged in
enhancing its sales through ‘shoulder’ campaign for its Slurpee product that cited the benefits of
the produc t beyond just refreshment. The company has also started celebrating 7-Eleven day as
a promotion strategy to get more customers to its stores. On this day the 7-Eleven stores offers
free Slurpee from any of its stores. Also the company started offering small Slurpee on fuel
purchase to get new customers. The company also offers gift cards, 7-Eleven Universal Fleet
Card, Prepaid Cards to give special offers to its customers. 7-Eleven has also been engaged in
many events like Shelter Makeover Project, Unisel Voice for Refugee, Slurpee Tasting Test etc
to attract the audience and build brand awareness.

Since this is a service marketing brand, here are the other three Ps to make it the 7Ps marketing
mix of 7-eleven.

People:
7-Eleven company employees more than 45000 employees and hires college graduates and
military veterans among its staff. 7-Eleven company also offer lots of perks and benefits to its
employees to sharpen their skills and grow their career within the company with a feeling of
satisfaction and safety for not only employees but also their families. 7-Eleven offers health
program and dental care program to both its full time and part time employees. The company
also awards its employees who have completed their one year in company by profit sharing. 7-
Eleven also runs an Employee assistance program to help employees tackle financial or legal
problems. 7-Eleven is not only concerned with people within their company but also their
customers and people around. 7-Eleven company runs a project A-Game to help in development
of youth by imparting education. 7-Eleven also runs a project called operation chill to reduce
crime and improve relationship between police and youth.

Process:
7-Eleven is one of the largest convenience store which has retail chain of size 60000+
worldwide. A customer can enter the store and buy food, drinks and lot more. Most of the 7-
Eleven stores operate 24 hours a day, 7 days a week. So the store offers food varieties for
breakfast till midnight. There are various ways to check out from the store. A person can pay
through cash or credit/debit card at any 7-Eleven store.7-Eleven also offers a bill payment
application. 7 Eleven also offers gift card, prepaid card, 7-Eleven Universal Fleet Card as one of
the payment option. The customer can also use 7-Eleven mobile application to order products
and pay bills. 7-Eleven has also tied up with logistic companies like DoorDash and Postmates
which uses technology to cater to on-demand delivery shopping solution to its customers to serve
them better.
https://www.mbaskool.com/marketing-mix/services/17046-7-eleven.html

SWOT for 7-Eleven

Strengths
CONVENIENT LOCATIONS
7-Eleven has over 50,000 outlets throughout the world, which gives them a significant
location and convenience advantage. Obviously, being a convenience store, their
primary benefit to consumers is that commonly purchased products are located at
nearby stores. Therefore, greater market coverage through a greater number of outlets
will provide increase convenience to more consumers.
OVERALL BRAND EQUITY
7-Eleven is generally perceived as the market leader by consumers in the convenience
store sector. This brand equity translates into customer loyalty and reduced price
sensitivity and, therefore, continued stability of revenue streams across its outlets.
INDIVIDUALLY BRANDED PRODUCTS
In addition to having a strong overall brand, 7-Eleven also has several branded product
offerings. The most famous of this are probably the Slurpee and the Big Gulp. In some
countries they also have other branded offerings such as Movie Quik in the United
States. These individual product brands provide a further strength to 7-Eleven, as
consumers may choose to seek out these particular products/brands as their preferred
choice.
FRANCHISED MODEL
Many of the 7-Eleven stores throughout the world are franchised. This provides to
strengths for the organization – the first being that they can continue to grow the
number of outlets throughout the world without having significant capital requirements,
as the franchisee is typically responsible for the setup costs of the outlet – and the
second advantage being that the stores are run by motivated individuals who have a
profit incentive for the store to perform well.
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DIVERSITY OF INCOME
Because the overall chain of 7-Eleven operates in multiple countries, the parent
company has essentially diversified its income streams across multiple markets. While
this can also be a weakness, it also provides a strength of stability of income as a
downturn in one particular country is unlikely to impact their overall financial results to a
significant extent.
Weaknesses
HIGH RENTAL COSTS
Due to the need to locate the 7-Eleven outlets in very convenient locations, they are
likely to incur higher rental costs as a result. This higher operating cost structure will
mean that they will need to adopt a price premium approach. There are some
consumers who are happy to pay a little bit more for convenience and speed of
purchase, however other budget-conscious consumers a more price sensitive.
HIGH STAFF COSTS
Similar to the high rental costs above, because the store operates on a 24/7 basis in
some locations, this type of retailing operation is likely to have a higher ongoing
operating cost structure. As a consequence of these higher costs, 7-Eleven will be
required to have higher price offerings in order to protect their margins.
FRANCHISEES
Although the overall franchised model is a strength as indicated above, running a large
team of franchisees throughout the world is also a weakness. This is because it
removes some element of direct control of the day-to-day operation of each outlet and
passes it to the franchisee. In addition, a management team is required to recruit, train
and monitor the various franchisees, which also adds to the overall cost structure on an
operational basis.
Opportunities
CONTINUED MARKET DEVELOPMENT
As with many chains of small retailers, one of the obvious ways to grow their business is
through market development. This means increasing the number of stores they have in
existing markets and cities and increasing the number of countries that they operate in.
While there is potential to cannibalize sales of existing outlets, much of this concern is
passed to the franchisee and does not necessarily affect the parent company.
INCREASED PRODUCT OFFERING
In many of the 7-Eleven stores, there would be physical capacity to increase the product
range and offering. This provides the opportunity of being able to offer a greater
selection of both physical products, as well as services, such as ATMs, cellphone cards,
and perhaps even car insurance. Certainly in some countries, 7-Eleven has expanded
into offerings of wine, beer, fuel, ATMs, coffee, donuts, pizza, sandwiches and so on.
EXCLUSIVE PRODUCT OFFERINGS
7-Eleven has managed to form some strong relationships with key manufacturers that
have strong brands. An example here is Gatorade, where certain flavors are only
offered through 7-Eleven stores. This has advantages to both of the strategic partners,
and is something that will broaden the range of benefits that 7-Eleven delivers to its
consumers.
CO-BRANDING LOCATIONS
7-Eleven could expand their geographic coverage through co-branded outlets with other
significant retail offerings. For example, they could partner with a coffee chain or a
sandwich chain and set up a co-branded store – where both stores operate
independently but out of the same location. This has the advantage of attracting more
consumers, who are possibly less reliant on the convenience aspect, and are likely to
buy from both businesses over time.
Threats
SUPERMARKETS MOVING TO 24/7 HOURS
In some parts of the world, major supermarket chains have adopted a 24/7 operating
system. It is common for most major supermarket chains to have extended hours. This
erodes 7-Eleven’s natural competitive advantage of having extended shopping hours.
This is a significant threat to 7-Eleven over time, as they would not have the low cost
structure required to compete effectively on a price basis with a major retail chain, such
as Walmart for example.
SUPERMARKETS MOVING TO ONLINE DELIVERIES
Some consumers are adopting the system of ordering their groceries online and then
having them delivered. Although this requires some pre-planning, it does also offer
significant levels of convenience to organized consumers, which does represent a threat
to 7-Eleven’s convenience-based competitive advantage.
SECURITY
Because 7-Eleven is a convenience store that handles cash and may be open on a 24/7
basis, it is always likely to be a target for theft and armed hold-up. Obviously the chain
has put in various security measures in different parts of the world, including video
cameras, safes, and window barriers and so on.
SHOPLIFTING
Like most retail stores, 7-Eleven will have the continued threat of minor shoplifting and
stealing. In some locations, these stores operate on a lean budget and only have
minimal staff, which presents the opportunity for some consumers to occasionally
shoplift. Like with the security threat above, video cameras may assist in this regard.
Marketing Strategy,

https://www.marketingstudyguide.com/example-swot-7-eleven/

· Franchisee recruitment plan and flowchart

· Franchisee prospectus
· Franchisee sales and advertising
· Franchisee location and criteria selection
· Grand opening plan
· Customer advertising
Management
· Headquarters' organization
· Policies and procedures
· Franchisee organization
· Operations manual
· Training manual
· PERT chart

Finance and Accounting

· Start-Up or Turnkey Costs
· Financial Position
· Balance Sheet
· Income Statement
· Cash Flow Statement 
· Breakeven Analysis
· Ratio Analysis
· Provision for Taxation
· Financial Records for the Franchisee
Legal Requirements
· Business structure
· Licenses, contracts, and permits
· Types and anticipated costs of insurance
· Disclosure documents
· The franchising agreement itself
· Conditions integral to the franchisor-franchisee relationship
· Possible termination

INTRODUCTION

The 7-Eleven brand is a global icon instantly recognized locally and understood internationally.
They are known to customers nationwide for our products, quality, service, cleanliness and
value. And they are the benchmark for retail innovation and technology in the convenience store
industry.

The founder of this concept ( Joe C. Thompson Jr. ) thought that it would be best if there are
available small packs of important goods in a store that is convenient for the people in the
community to get any time of the day. Joe C. Thompson Jr. on the other hand saw this as an
opportunity and expanded the concept and tried to open other retailing stores to other locations.
Moreover, Thompson later became the president of Southland Corporation, the owner of
7eleven stores.
Philippine Seven Corporation

Was registered with the Securities and Exchange Commission (SEC) on November 1982. It
acquired from Southland Corporation (now 7-Eleven Inc.) of Dallas, Texas the license to
operate 7-Eleven stores in the Philippines in December 13, 1982. Operations commenced with
the opening of its first store in February 29, 1984 at the corner of Kamias Road and EDSA
Quezon City, Metro Manila. Considering the country’s economic condition at that time, the
company grew slowly in its first year of existence.

In July 1988, PSC transferred the Philippine area license to operate 7-Eleven stores to its
affiliate, Philippine Seven Properties Corporation (“PSPC”), together with some of its store
properties. In exchange thereof, PSC received 47% of PSPC stock as payment. Concurrent with
the transfer, PSC entered into a sublicensing agreement with PSPC to operate 7-Eleven stores
in Metro Manila and suburbs. As part of PSPC’s main business, it acquired or leased
commercial properties and constructed retail store buildings, leasing the buildings to PSC on
long term basis together with most of the capital equipment used for store operations. Hence,
PSC concentrated on managing its stores and effectively took the role of a pure retailer.

In May 1996, the stockholders of both PSC and PSPC approved the merger of the two
companies to advance PSC’s group expansion. In October 30, 1996, SEC approved the merger
and PSPC was then absorbed by PSC as the surviving entity. With the consolidation of the
respective lines of business of PSC and PSPC, the PSC’s retailing strengths were
complemented by PSPC’s property and franchise holdings. Their management as a single entity
enhanced operational efficiency and strengthened ability to raise capital for growth. In
September 17, 1998, PSC established Convenience Distribution Inc. (“CDI”), a wholly owned
subsidiary, to provide a centralized warehouse and distribution system to service its 7-Eleven
stores.
With the effectivity of the Retail Trade Liberalization Act (R.A. 8762) on March 25, 2000, foreign
entities were allowed to invest in an existing retail company subject to the requirements of the
law. President Chain Store Corporation of Taiwan (PCSC), which is also the 7-Eleven licensee
in Taiwan operating about 2,700 stores, purchased 119,575,008 common shares of PSC or
50.4 % of PSC’s outstanding capital stock at the price of P8.30 per share. The purchase was
made under a tender offer during October 9 to November 7, 2000 by President Chain Store
(Labuan) Holdings, Ltd., a Malaysian investment holding company, whollyowned by
in strengthening its organizational structure and operating systems. This shall enable PSC to
pursue store expansion plans on sound and profitable basis. A new affiliate, Store Sites
Holdings Inc., was also established on November 9, 2000, as the entity to own land properties
of the Company. These land properties are leased to PSC by SSHI.  The Corporation’s area
license to operate 7-Eleven Stores in the Philippines has an initial term of 20 years which shall
expire on December 12, 2002 and it is expressly provided under the contract that the same shall
be renewed for another 5 years (or until Dec. 12, 2007) under the same terms and conditions
subject to approval of supervising agency under Department of Trade and Industry. PSC and
SEI have completed the area license renewal document with the approval of the Intellectual
Property Office of the submitted copy and shall complete the execution of the agreement this
year.

The company had a manpower complement of 2,017 personnel, 856 of whom are regular
employees, 1,159 contractual/probationary and part-timers to augment temporary needs during
peak hours or season in the stores and the support services units.  There is no existing labor
union in the company and collective bargaining agreement.  There is an Employee
Council which communicates to management the employee concerns.
7-Eleven today is focused on redefining and enhancing convenience through strategic initiatives
designed to take advance of new technologies and merchandising processes, but which remain
based on the fundamental principle of the simple business concept it pioneered over 70 years
ago – to provide customers an ever changing selection of quality products and services at fair
everyday prices, through speedy transactions in a clean, safe and friendly environment.

Corporate Vision

Vision
Our vision is to be best retailer of convenience.

Mission
To make daily life easier by providing modern convenience.
Oath of 7-Eleven Employees

I want to treat everyone honestly and promise to try my best to serve our customers in order to
create a better future for the company, my family, and myself.

The 5 7-Eleven fundamentals are quality, speed, selection, and value in a safe and pleasant
environment.

Corporate Values

 Customer focused
 Teamwork
 Integrity
 Reliability
 Results oriented

The First 7 Years

On October 26, 1982, Philippine Seven Corp. (PSC) acquired the license agreement to use the
7-Eleven Convenience Store system in the entire Philippines from Southland Corporation of
Dallas, Texas. After a month, PSC was registered with SEC on 29 November 1982. The
incorporators were Jose T. Pardo, Vicente T. Paterno and Francisco R. Sibal. The company’s
chief mission was to introduce an entirely new retailing concept to the Filipino consumers, i.e.
operating a chain of 24-hours convenience stores. The first corporate office was located at the
ninth floor of the Century Tower building in Salcedo Village, Makati City.

In order to apply Southland technology in all phases of managing a 7-Eleven convenience store,
PSC sent five of its employees to various Southland installations in the US. The so-called Five-
Man Team was consisted by Francisco R. Sibal, Executive Vice President; Ramon de Jesus,
General Manager; Jose Blanch, Merchandising Manager; Wilfredo Villanueva, Accounting
Manager; and Teodoro Wenceslao, Store Operations Manager. They left on February 15, 1983
to undergo a five-week in-depth training in their respective fields. Upon their return to the
country, the Five-Man Team immediately set out to practice what they’ve learned from the
functional training: site selection, design and construction of the first 7-Eleven store, negotiation
with suppliers, ordering of equipment’s, recruitment and training of first batch of employees.

The assassination of Ninoy Aquino at the Manila International Airport on August 21, 1983
triggered the steady deterioration of the economic and political situation in the country. In spite
of the bleak state of the market, PSC decided to proceed with the 7-Eleven project. On this
account, the company needed fresh capital to build its first two stores. The Board of Directors
increased their respective equity contributions in PSC and invited two outstanding businessmen,
Mr. Jorge L. Araneta and Mr. Ernesto B. Rufino Jr., to become new shareholders and directors
of PSC.
Despite the aggravating political and economic adversities, PSC gamely opened its first 7-
Eleven convenience store, located at the corner of EDSA and Kamias Streets in Kamuning,
Quezon City, on February 29, 1984. This store proved to be a tough one as it weathered all
types of calamities, the EDSA revolution, and coup ‘d’états.

The second 7-Eleven convenience store was opened at President Ave., BF Homes, Parañaque,
which was adjacent to the entrance of a posh subdivision, in April 1984. Having been able to
open two stores within the same year, PSC was able to make necessary comparisons in the
operations of its stores. It has learned that the primary customers of 7-Eleven stores came from
the middle class: the salaried, busy employee who preferred a quick fix, while on his/her way
home or to the office because PSC steadily lost money during the years of 1984 to 1985, and
due to the outrageous impossibility of securing bank loans, Francis R. Sibal was compelled to
sell his share in the company and relinquish his responsibilities as executive vice president and
managing director. His duties as Managing director was assumed by Mr. Vicente Paterno, while
his responsibility for external affairs was taken over by Mr. Jose T. Pardo.

To infuse additional capital into the company, PSC sought the assistance of a friendly large
Philippine organization who later offered a substantial semi equity term loan. Because of this,
the company had adequate funds to open its third 7-Eleven convenience store at the corner of
Harrison and Libertad Streets in Pasay City in October 1985 and patterned it to the
characteristics of the Kamias branch. Management also came up with a clever leasing scheme
wherein the lender participates in store profit when an individual store achieves higher than
target sales volume. This was an effective way to source out funds for the construction of more
stores. The first 7-Eleven Convenience Store built through this scheme was the branch located
in Nagtahan Rotonda, at Santa Mesa, Manila.

On May 19, 1988, PSC’s sister company, Philippine Seven Properties Corporation (PSPC) was
registered with SEC, and its incorporators were Manuel Agustines, Jorge Araneta, Jose Pardo,
Vicente Paterno, and Alfredo Ramos. PSPC undermined the difficulties posed by the
Constitution, and made it easier for PSC to raise money through acceptance of foreign and
corporate investments. PSPC was able to successfully generate additional funds which were
used by PSC in the construction of six stores in 1988, and five stores in 1989. Indeed, a
tremendous blast of enthusiastic action from PSC Management.
Though still inexperienced in the field of the convenience store industry, PSC showed
remarkable results. In fact, according to Southland’s technical representatives, PSC’s 7-Eleven
stores compared favorably with other 7-Eleven stores anywhere in the world. The stores were
clean, comfortable, and the ambience was very inviting and pleasant. Surely, the company has
learned its lessons well.

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