The Dallas Morning News reports that when 7-Eleven decided to buy White hen Pantry last week (as reported in Friday’s MNB), it was part of a broader growth strategy that hinges on three basic hooks:
1. Acquiring existing stores to build the company’s fleet.
2. Building new stores.
3. Inviting existing store operators to become 7-11 franchisees.
In addition, 7-Eleven reportedly hopes to use what it sees as White Hen’s strength in prepared and fresh foods as a way to developing its own capacities in this area.
This growth strategy wasn’t developed in a vacuum. 7-Eleven management is aware of how Canada’s Alimentation Couche-Tard has been buying up small c-store chains in the US. And, of course, it knows that Tesco is coming to Southern California, Phoenix and Las Vegas with its own version of the c-store, the beginning of what is expected to be a major US foray by Tesco.
7-Eleven president/CEO Joseph DePinto says he’s not concerned about the new competition. “Bottom line is 7-Eleven is the premier operator,” he tells the paper. “We invented the industry, we've seen competitors come in and because of the strength of brand and differentiation, it's not a concern.”
1. Acquiring existing stores to build the company’s fleet.
2. Building new stores.
3. Inviting existing store operators to become 7-11 franchisees.
In addition, 7-Eleven reportedly hopes to use what it sees as White Hen’s strength in prepared and fresh foods as a way to developing its own capacities in this area.
This growth strategy wasn’t developed in a vacuum. 7-Eleven management is aware of how Canada’s Alimentation Couche-Tard has been buying up small c-store chains in the US. And, of course, it knows that Tesco is coming to Southern California, Phoenix and Las Vegas with its own version of the c-store, the beginning of what is expected to be a major US foray by Tesco.
7-Eleven president/CEO Joseph DePinto says he’s not concerned about the new competition. “Bottom line is 7-Eleven is the premier operator,” he tells the paper. “We invented the industry, we've seen competitors come in and because of the strength of brand and differentiation, it's not a concern.”
- KC's View:
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We think that 7-Eleven has to mine its history and tradition and play its own game.
But we also think that maybe DePinto is understating the situation a bit when he says that Tesco is “not a concern.”
Just a bit.
