As a convenience store, 7-eleven has been a staple in America for some time now. I visited there all the time and was more wowed by the mystique of the 7-eleven brand than anything else. And for some reason 30 years later and they are doing better than ever even during a pandemic. As I Mentioned n my previous post “Success Leaves Clues” and one of those clues was in a Video that was published on Youtube.com on Jan 6, 2011 for a 7-eleven campaign add. The rule of thumb is “In order to see what any company is going to do next look at what they have already done”.
7-Eleven has more than 71,000 stores worldwide and has pivoted mightily fast amid this pandemic. What did they do? They invested heavily in safety and hygiene. You mean they did not rest on their laurels and rely on you coming into their stores because your vehicle needs gas? No, they thought about each employee at all 71,000 stores. In addition, they partnered with a third-party delivery services to make sure its products could meet the needs of individuals sheltering in place or social distancing. 7-eleven’s purchase of Speedway is just the icing on the cake.
By reading this quick summary of the rationale of the Speedway purchase by 7-eleven will give you insight into how decisions are made that effects multiple parts of any Ecosystem. Strategic and Financial Rationale of 7-Eleven’s Purchase of Speedway: (Repost from LaneReport.com).
- Accelerates 7‑Eleven’s growth trajectory and diversifies presence in the U.S. Speedway and 7‑Eleven have complementary geographic footprints with little overlap. 7‑Eleven currently has over 9,800 stores in the United States and Canada and with Speedway’s high-quality portfolio of approximately 3,900 stores, this acquisition will bring 7‑Eleven’s total number of stores to approximately 14,000 in the U.S. and Canada. Following the transaction, 7‑Eleven will have a presence in 47 of the top 50 most populated metro areas in the U.S., positioning the company as a clear industry leader in a fragmented industry with favorable macroeconomic trends.
- Strengthens financial profile to position the company for continued success. Speedway, with an annual pre-synergy run-rate EBITDA of approximately $1.5 billion prior to the acquisition, is an exceptional business with significant opportunities for future growth. 7‑Eleven expects to achieve $475 million to $575 million of run-rate synergies through the third year following closing while maintaining financial flexibility and a strong balance sheet. Upon closing, 7–Eleven will be even better positioned to continue to pursue profitable growth opportunities.
- A combined store network significantly enhances economies of scale. Upon closing, 7‑Eleven and Speedway will share best practices to deliver products and promotions based upon customer demand and continue both companies’ legacy of innovation. In addition, the combined company will be well-positioned to maximize efficiencies and optimize relationships with vendors and business partners.
- Commitment to ensuring a successful integration. 7‑Eleven plans to form an integration steering committee with representatives from the leadership of both 7–Eleven and Speedway. Brand 7‑Eleven looks forward to welcoming the approximately 40,000 members of the Speedway team into the 7‑Eleven family and integrating best practices of both companies.
- Commitment to environmental stewardship. 7‑Eleven reaffirms and expands the company’s existing commitment to important environmental priorities as a part of its broader Environmental, Social, and Governance (ESG) efforts. Together, the combined.
When was the last time someone from Shell gas delivered a cup of coffee and donuts to your house? Sounds crazy but over time it works in terms of always thinking about those that they serve. 7-Eleven truly pivoted. Below, I outline a few ideas that I came up with by reading in-between the lines; based on the successful pivot of 7-Eleven.
Create a Franchise Model with an Ace Hardware feel: It’s no Secret that when Walmart begin to expand many mom and pop hardware stores went belly up. People craved this warehouse experience with cheap prices and local stores just couldn’t replicate that model to the scale Walmart could. The game has changed and now you can build a phenomenal system and localize your brand to meet the needs of your community. These are called Platform busines Models that allows multiple players into loop so they can dance with each other. Typical models include (Airbnb & Uber). Build the community but never control the main asset.
Connect Your Story, Brand, or identity with a Movie: The 7-eleven Kwik E Mart/ plug into the Simpsons brand was genius to say the least, even if I did not get as big as it has now. Why? Because it represents something, we all can relate to. Getting a slushy and donuts from a convenience store is something all of America can relate to. It’s like Red Bull or any other variety of energy drinks. Even “Dunkin Donuts” boasts in their slogan “America runs on Dunkin” as it’s a play on something we can all relate to #Coffee.
Be Bold enough to Sell Blue Slushies: I don’t mean to sell Blue Slushies literally, but to create a fun and inspiring twist to your offerings. I don’t have the exact number but how many blue slushies because of the Simpsons show has 7-Eleven sold in the last 30 years? Too many to count but the idea is to make your base product a household name. If you sell mentoring, send me an email about your Irish Spring “it smells good” mentoring and I am fair game. Just be bold enough.
Create Your own TV commercials: Budget issues seem to come up when the word commercial comes in terms of advertising for one’s business. That excuse has just gone out of the door. There are thousands of tools for creating DIY videos and commercials that promote your brand (I.e. Promo, Animoto, Sightly, Viddyad etc). Be creative and hire someone who can help you to create a more fun-loving brand that speaks to the emotions of your community.
Develop a Strategic Rationale for Long-term success: The Purchase of Speedway started 10 years ago, and the deal just finalized. Metaphorically, your love, compassion and service for your market goes a long way in building equity and trust they can count on. As you can see from the rationale above concerning 7=-Eleven’s purchase that they were thinking about environmental footprints, economies of scale and growth trajectories. This is what I call “The Magic of Thinking Big”.