In an article published this past week in the Convenience Store & Petroleum Daily News, Steve Holtz & Samantha Oller Interview 7-Eleven CEO Joe DePinto and discuss plans for 7-Select. Interestingly, 7-Eleven acknowledges learning from other channels and specifically looking at Target & Safeway.
7-Eleven’s Summer Toolkit
7-Select snack, candy line takes wing as consumers clamor for value alternatives
Working under the oft-stated notion that the summer selling season is when convenience stores in the Chicago area make most of their money, 7-Eleven executives underscored the importance of private-label products, fresh foodservice and other strategic tools during this week’s 7-Eleven Franchise Owners Association of Chicagoland Trade Show.
“People have less money…so we have to work harder,” said CEO Joe DePinto, who pointed out that the sale of budget beer, budget cigarettes and private-label products are all up in 7-Eleven stores. “It’s very difficult for our smaller competitors to do private label. There’s a lot of equity in the 7-Eleven brand.”
Since officially launching the 7-Select proprietary brand in November with 32 snack, food and beverage items, the product line has seen remarkable growth. “You guys have done a tremendous job with 7-Select,” DePinto told the group of more than 200 franchisees. “In the one month since you took on 7-Select chips, they are now five of our top six ship SKUs in the store.”
The fact that 7-Select was able to muscle out strong national and regional brands is perhaps the best evidence so far that the retailer—already synonymous with its Slurpee and Big Gulp brands—has many more opportunities to mine in private label. And the current economy has provided the window.
As of December 2008, there were 85 SKUs in the 7-Select line, accounting on average for $30 in sales per day, per store. Come this December, there will be 250 SKUs in the line, with executives estimating average sales of nearly $100 per day.
“Everyone hears a lot of need for value for consumers, and private label as an industry gets constant media attention, being a growing segment not only in convenience but across all retail channels,” Tom Gerrity, senior director of process foods, told CSP Daily News in a separate interview. In developing 7-Select—which also includes paper goods, batteries and packaged beverages— 7-Eleven examined private-label lines not only at other c-stores but also at leading retailers in the supermarket and discount channels, such as Safeway and Target, to examine what they’re doing right with product selection and packaging.