7-Eleven will close 444 locations as convenience stores aim for better eats
Right-sizing the Big Gulp… Hundreds of hot-dog rollers will soon cease their eternal spinning as 7-Eleven parent Seven & I shutters 444 “underperforming” stores across North America. The Slurpee legend blames six straight months of falling sales, plunging cigarette purchases, and inflation. After announcing it’s closing 3% of its 13K+ 7-Elevens in the US and Canada, Seven & I slashed its annual profit forecast by nearly half. It’s been an eventful few months for the convenience colossus.
Taquit-offer: Seven & I rejected a $39B takeover bid last month from Circle-K owner Couche-Tard. Then last week, Couche-Tard upped its offer to $47B for Seven & I’s 84K 7-Eleven stores, Speedway and Sunoco gas stations, and massive ATM network.
Playing defense: To fend off the acquisition play, Seven & I pitched investors a plan to split into two businesses. It also wants to expand fresh-food offerings in the US (its 7-Elevens in Japan are hugely popular for their grocery-like spreads).
Lotto tickets and bathroom breaks… US convenience stores are struggling to win consistent customers (convenience sales fell 5% last year to $776B). They’re losing sales to value-focused national retailers like Walmart and Target, but also to smaller rivals with regional flair like Wawa and Sheetz. This year Shell announced it’ll sell off 1K of its retail locations by the end of next year, and Amazon has offloaded many of its Go convenience stores.
You gotta evolve to grow… 7-Eleven pioneered to-go coffee and grew on the popularity of road-trip chicken rollers. But today customers are leaning toward fresher offerings like Wawa’s hoagies and Buc-ee’s brisket. That fresh-to-go model has made 7-Eleven big in Japan, and now it wants to replicate that in the US.