...SEVEN-ELEVEN JAPAN CO. CASE ANALYSIS What is the future outlook for Seven Eleven Stores in USA? Seven-Eleven is part of an international chain of convenient stores. 7-Eleven, primarily operating as a franchise, is the world's largest operator, franchisor and licensor of convenience stores, with more than 46,000 outlets. The Seven-Eleven business model consists of five key elements: * A differentiated merchandising strategy; * Utilization of 7-Eleven’s retail information system & Managed distribution; * Providing a convenient shopping environment; and * A unique franchise model. Let us have a brief look over 7-Eleven stores in US and Japan: Seven-Eleven Japan: * High density market presence with 50-60 stores supported by distribution centre. * Limited geographical presence * Emphasized regional merchandizing * Processed and fast foods contributed to most of its sales * Products like food and beverages, magazines and consumer items such as soaps and detergents * Services offered like payment of electricity bills, telephone, gas bills, meal delivery services, 7 dream e-commerce, electronic money offering and many * Advanced information technology helped store to analyse store data every day morning and helps in having valuable shelf life * Information system installed in every outlet and linked to HQ, Suppliers and 7-eleven distribution centres. Uses ISDN to collect, process and feedback POS data quickly * Delivery frequency...
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...Seven-Eleven Japan1 Established in 1973, Seven-Eleven Japan set up its first store in Koto-ku, Tokyo, in May 1974. The company was first listed on the Tokyo Stock Exchange in October 1979. In 2004 it was owned by the Ito-Yokado group, which also managed a chain of supermarkets in Japan and owned a majority share in Southland, the company managing 7-Eleven in the United States. On September 1, 2005, Seven & I Holdings Co., Ltd., was established as the holding company for Seven-Eleven Japan, Ito-Yokado, and Denny’s Japan. Seven-Eleven Japan realized a phenomenal growth between the years of 1985 and 2007. During that period, the number of stores increased from 2,299 to 12,034, annual sales increased from 386 billion to 2,574 billion yen; and net income increased from 9 billion to 91.5 billion yen. Additionally, the company’s return on equity (ROE) averaged around 14 percent between 2000 and 2004. In 2004, Seven-Eleven Japan represented Japan’s largest retailer in terms of operating income and number of stores. Customer visits to Seven-Eleven outlets totaled 4.1 billion in 2007, averaging almost 35 visits to a Seven-Eleven annually for every person in Japan. Company History and Profile Both Ito-Yokado and Seven-Eleven Japan were founded by Masatoshi Ito. He started his retail empire after World War II, when he joined his mother and elder brother and began to work in a small clothing store in Tokyo. By 1960 he was in sole control, and the single store had grown into a $3 million company...
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...Seven-Eleven Japan Co. Established in 1973, Seven-Eleven Japan set up its first store in Koto-ku, Tokyo, in May 1974. The company was first listed on the Tokyo Stock Exchange in October 1979. In 2004 it was owned by the Ito-Yokado group, which also managed a chain of supermarkets in Japan and owned a majority share in Southland, the company managing Seven-Eleven in the United States. Seven-Eleven Japan realized a phenomenal growth between the years of 1985 and 2003. During that period, the number of stores increased from 2,299 to 10,303, annual sales increased from 386 billion to 2,343 billion yen, and net income increased from 9 billion to 91.5 billion yen. The Seven-Eleven Japan Franchise System Seven-Eleven Japan developed an extensive franchise network and performs a key role in the daily operations of this network. The Seven-Eleven Japan network includes both company-owned stores and third-party-owned franchises. In 2004 franchise commissions accounted for over 68 percent of revenue from operations. To ensure efficiency, Seven-Eleven Japan based its fundamental network expansion policy on a market-dominance strategy. Entry into any new market was built around a cluster of 50 to 60 stores supported by a distribution centre. Such clustering gave Seven-Eleven Japan a high density market presence and allowed it to operate an efficient distribution system. Seven-Eleven Japan, in its 1994 annual report, listed the following six advantages of the market-dominance strategy: ...
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...1 i CASE STUDY ~ SEVEN-ELEVEN JAPAN CO. Established in 1973, Seven-Eleven Japan set up its first store in Koto-ku, Tokyo, in May 1974. The company was first listed on the Tokyo Stock Exchange in October 1979. In 2004 it was owned by the Ito-Yokado group, which also managed a chain of supermarkets in Japan and owned a majority share in Southland, the company managing SevenEleven in the United States. Seven-Eleven Japan realized a phenomenal growth between the years of 1985 and 2003. During that period, the number of stores increased from 2,299 to 10,303; annual sales increased from 386 billion to 2,343 billion yen; and net income increased from 9 billion to 91.5 billion yen. Additionally, the company's return on equity (ROE) averaged around 14 percent between 2000 and 2004. In 2004, Seven-Eleven Japan represented Japan's largest retailer in terms of operating income and number of stores. Customer visits to Seven-Eleven outlets totaled 3.6 billion that year, averaging almost 30 visits to a SevenEleven annually for every person in Japan. COMPANY HISTORY AND PROFILE Both Ito-Yokado and Seven-Eleven Japan were founded by Masatoshi Ito. He started his retail empire after World . War II, when he joined his mother and elder brother and began to work in a small clothing store in Tokyo. By 1960 he was in sole control, and the single store had grown into a $3 million company. After a trip to the United States in 1961, Ito became convinced that superstores...
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...CASE: SEVEN ELEVEN JAPAN Executive Summary I Executive Summary The goal of this case is to analyze how a firm can be successful by structuring its supply chain to support its supply chain strategy. Once Seven-Eleven Japan decided to provide responsiveness by rapid replenishment, it then structured its facilities, inventory, information, and distribution to support this choice. The case also brings up the question of whether the same approach can work in the United States, especially given the greater distances and lower store density. Table of Contents II I Table of Contents Executive Summary ................................................................................................................. I II List of Abbreviations......................................................................................................... III 1 Seven-Eleven Japan Co........................................................................................................ 1 1.1 History and Profile ........................................................................................................... 1 1.2 Framework of further discussions .................................................................................... 1 2 Discussion ............................................................................................................................ 1 2.1 Supply Chain Responsiveness ..................................................................
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...Sunil Chopra TEACHING NOTE: SEVEN-ELEVEN JAPAN CO. The goal of this case is to illustrate how a firm can be successful by structuring its supply chain to support its supply chain strategy. Once Seven-Eleven Japan decided to provide responsiveness by rapid replenishment, it then structured its facilities, inventory, information, and distribution to support this choice. The case also brings up the question of whether the same approach can work in the United States, especially given the greater distances and lower store density. Questions 1. A CONVENIENCE STORE CHAIN ATTEMPTS TO BE RESPONSIVE AND PROVIDE CUSTOMERS WHAT THEY NEED, WHEN THEY NEED IT, WHERE THEY NEED IT. WHAT ARE SOME DIFFERENT WAYS THAT A CONVENIENCE STORE SUPPLY CHAIN CAN BE RESPONSIVE? WHAT ARE SOME RISKS IN EACH CASE? As responsiveness increases, the convenience store chain is exposed to greater uncertainty. A convenience store chain can improve responsiveness to this uncertainty using one of the following strategies, especially for fresh and fast foods: Local capacity: The convenience store chain can provide local cooking capacity at the stores and assemble foods almost on demand. Inventory would be stored as raw material. This is seen at the U.S. fast food restaurant franchise Subway where dinner and lunch sandwiches are assembled on demand. The main risk with this approach is that capacity is decentralized, leading to poorer utilization. Local inventory: Another approach is...
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...Seven Eleven Case Study Questions 3, 4 and 6 Question 3 What has Seven Eleven done in its choice of facility location, inventory management, transportation and information infrastructure to develop capabilities to support its supply chain strategy in Japan? In order to support it’s supply chain strategy in Japan, Seven Eleven has developed a number of capabilities to ease the movement of inventory to and from its distribution center and around it’s entire supply chain network. One method in particular that Seven Eleven has implicated is its cluster location strategy. This is where an average of 50 to 60 stores along side a distribution center are located within a region of demand in Japan. This approach provides Seven Eleven with a centralized strategy to its supply chain; meaning an effective distribution network is formed across the company as the stores and distribution center are located within close proximity to each other allowing for a reduction in transportation times and cost. Another strategy Seven Eleven has implicated to support its supply chain strategy is its effective use of a combined delivery system. This enables the company to distribute products in a more efficiently manner across the supply chain network, as products that fall into similar temperature categories can be transported together and to several store at one given time. Seven Eleven’s investment in inventory management and information Infrastructure has also aided improvements to...
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...Seven Eleven – Case Study Q1: Knowing the cross functional drivers of a supply chain performance, discuss how Seven Eleven have achieved a high performance and a successful supply chain. Keep in mind the strategic fit of this supply chain. Note: Referencing is a really important matter in writing any assignment, According to "Harvard Referencing" To reference you need to: First: point in your text the authors or the article that you have used as an evidence for your argument. Second: Write the references at the end of your article or work. First: Inside the Text: There are two main types of referencing 1- You write the author names and year of publishing at the beginning of your text Example: Dr Wilma Flintstone stated in her lecture on 5 September 2000 that acid jazz has roots as far back as 1987. Eisenberg and Smith (1986) agree that ‘it is hard to assign general meaning to any isolated nonverbal sign’. 2- Your write the author name and year at the end of the your text Example: ‘it is hard to assign general meaning to any isolated nonverbal sign’ (Eisenberg and Smith, 1986) Second: the reference table: 1- Book Author: - One Author: Adair, J. (1988) Effective time management: How to save time and spend it wisely, London: Pan Books. - Two Authors: McCarthy, P. and Hatcher, C. (1996) Speaking persuasively: Making the most of your presentations, Sydney: Allen and Unwin. Online Article: World Wide Web page Young, C. (2001) English Heritage position statement on the Valletta Convention...
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...Elementos Importantes de Seven-Eleven- Japón • Antecedentes de la Compañía • Venden en Japon mas que Mc Donalds. • Numero 2 de ventas de libros de bolsillo. • Numero 1 de ventas en medias para dama y venta de baterías. • Habilidad en el uso de la información, su logística y mercadeo. • Más de 15,000 tiendas alrededor del mundo. • Es la cadena de tiendas de conveniencia más grande del mundo del sector. • Opera o franquicia 6,900 tiendas Seven Eleven, las tiendas restantes están localizadas en Norteamérica. • Se estableció en noviembre 1973 bajo un acuerdo de concesión regional entre Ito-Yokabo Co., Ltd, el supermercado líder en Japón y la Corporación Southland que opera las tiendas Seven-Eleven en los Estados Unidos. • Se ha mantenido en el primer lugar en tiendas de conveniencia en Japón durante veinte años desde que abrió su primera tienda en el centro de Tokio en mayo 1974. • En 1997, las ventas totales de SEJ, incluyendo franquicias fueron 1,609 billones de yenes (alrededor de 16 billones de dólares) • Ganancias netas de 550 millones de dólares convirtiéndola en la mayor cadena de tiendas al menudeo en Japón. • Ventas promedio más altas por tienda por día entre las tres cadenas de tiendas de autoservicio líderes, Daiei y Family Mart con 465,000 y 513,000 respectivamente frente a 689,000. • El precio de las acciones empezó en 100 yenes en 1980, alcanzó 2,300 yenes en 1987 y cerca de 8,000 yenes en 1997. • El liderazgo de SEJ en el mercado y su desempeño se...
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...The University of Jordan Faculty of Business Marketing Strategic Management The University of Jordan Faculty of Business Marketing Strategic Management Marketing Strategic Management Assignment – SWOT Analysis for Islamic International Arab Bank (IIAB) Marketing Strategic Management Assignment – SWOT Analysis for Islamic International Arab Bank (IIAB) Done by: * Dania Done by: * Dania Table of Contents Introduction 3 IIAB Strategic Statement: 3 Vision Statement: 4 Mission Statement: 4 Our Policy Statement: 4 Objective Statement: 5 Strategic Statement: 4 External Environmental Scanning: 5 Macro-Environment & PESTEL Analysis 5 Five forces framework: 7 Market segmentation & Competitor Grouping 9 External Factors Analysis Summary (EFAS) 10 Internal Factors Analysis Summary (IFAS) 11 Stratigic Factors Analysis Summary (SFAS) 13 Introduction The Jordanian banking sector go back to the year 1925, when the Ottoman Bank commenced its operations in the country as the first commercial bank, followed by Arab Bank in 1934 and the British Bank of the Middle East in 1949. The banking sector remained limited to these three banks until 1955, when three new commercial banks were incorporated during the period 1955 - 1960, namely, Jordan National Bank, Jordan Bank, Cairo - Amman Bank in addition to Rafidein Bank, which opened its first branch in Jordan in 1957. The banking sector did not experience any major developments during...
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...example a nearby baseball game increasing the demand for beer and chips. These customer needs causes a high implied demand uncertainty. Products properties: middle range of products (3000SKUs); 60% of total sales at each store are processed and fast foods; 50% changes in the course of a year due to seasonal demand & new products; local preferences are important and vary; different consumption patterns throughout the day; stores have limited shelf space and little buffer inventory (limited store size). 7-eleven supply uncertainty is medium to high. Supply uncertainty is increased due to: high diversity of products, perishable products (e.g. frozen and dairy products), the rate of innovative/number of new products, possible delivery delays due to dense traffic around stores as well as possible low yields further upstream the supply chain (2nd, 3rd tier suppliers of raw materials e.g. rice). All these attributes call for a responsive supply chain. Assignment/Question #2 7-Eleven has a high degree of responsiveness, due to the high implied demand uncertainty and medium-high supply uncertainty. It is very crucial for their supply chain ability to respond to wide ranges of quantities demanded, meet short lead times, handle a large variety of products, meet a very high service level and handle supply uncertainty due to the customer needs mentioned above. Additionally they are innovative in the sense that they introduce constantly new products, as well as new services, to attract...
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...1. Convenience store to achieve responsiveness Handling information is very important to be responsive. 7-11 has already practised collecting information at POS and the SKUs are periodically reviewed through integrated network. Bringing production facilities closer to the stores High storage of inventory at certain store with capacity and replenish nearer store from there * Integrated information systems POS for forecasting Rapid replenishment * Bringing production facilities closer to the stores * High storage of inventory at certain store with capacity and replenish nearer store from there * * Integrated information systems pos for forecasting * Rapid replenishment 1, 2 & 3 Risk In being responsive is The Flexibility If the customer trend changes the business is in trouble. If a particular region goes out of trend the region would get isolated from the entire business and loss occurred with the properties associated with fixed cost. Over dependence on IT Infrastructure - Even though the IT infrastructure maintaining the information is good, failure in IT or n/w would make responsiveness more challenging and introduce new challenges. Selling power of supplier Need more capacity to accommodate Quality Shouldn’t lag in quality as the responsiveness is high Cost management & complex inventory handling Order cost increases if no of replenishment is more Inventory carrying cost increases if order in excess Under Utilization...
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...are some different ways that a convenience store supply chain can be responsive? What are some risks in each case? A convenience store can be more responsive by doing exactly what Seven-Eleven Japan is doing; many locations, rapid replenishment, appropriate technology deployment, and an equally responsive supplier (vertical integration for many of their SKUs). The risks associated with this system are the costs coupled with demand uncertainty. If demand patterns change dramatically, or the customer base changes, then Seven-Eleven is left with an operation that is not needed. In Seven-Eleven Japan’s case, multiple operations might be shuttered if an apartment building or large employer shuts down or relocates. 2. Seven-Eleven’s supply chain strategy in Japan can be described as attempting to micro-match supply and demand using rapid replenishment. What are some risks associated with this choice? Micro-matching supply and demand using rapid replenishment assumes that each store will repeat the same demand pattern on a daily basis. The tour bus phenomenon, where a group of unanticipated customers comes to the store and buys all of a type of product will cause difficulty for regular customers. During such an event, the store will likely stock out and customers may visit the next Seven-Eleven site down the block to make their purchases. Some of this demand may permanently shift, causing a local ripple; the replenishment may be excessive at one site and insufficient at an...
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...study of Seven-Eleven Japan Co. 1. Convenience store chain attempts to be responsive and provide customers what they need, when they need it, where they need it. What are some different ways that a convenience store supply chain can be responsive? What are some risks in each case? Ways of responsiveness of convenience store Risks supply chain Fast replenishment: Cost of transport 1-3 times daily store delivery Rely on the stability of Transport Local inventory: Cost of inventory maintenance Sales of items stockpiled in local store Cost of obsolete inventory Order taking*: Cost of numerous orders processing Delivering merchandise according to customers’ Limited lead time orders On-site producing: Cost of raw material inventory Producing merchandise with raw material on-site Fluctuation of sales 2. 7-Eleven's supply chain strategy in Japan can be described as attempting to micro-match supply and demand using rapid replenishment. What are some risks associated with this choice? Rapid replenishment and Micro-match supply & demand strategy highly rely on the efficient ordering system and the fast transport. As a result, the cost of ordering system and fast transport themselves can be a risk. Moreover, according to this case, 7-11 develops an anticipation system, in order to forecast the local sales. However, when customers’ needs fluctuate in short period and original anticipation loses effectiveness, it will face extra cost of transport. 3. What has 7-Eleven done in...
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...Lawson Inc., Japan’s second-largest convenience store chain, said Tuesday it will strengthen its health-related business as part of a midterm strategy to tap into the growing number of health-conscious customers in the aging society. “We aim to play a central role in supporting people’s healthier lives as more customers wish to stay in good health and live a long time,” Lawson Inc. President Takeshi Niinami told a news conference in Tokyo. According to the strategy, the company will offer consultations by pharmacists and dietitians through video phones at all stores in five years. It also aims to increase the number of stores selling nonprescription drugs to 3,000 in five years from the current 82. Lawson had 11,384 outlets nationwide as of August, including 109 Natural Lawson shops, which feature more healthy and organic products. Outlets under this brand will be increased to 3,000 in five years, the company said. Also revealed was a tieup with the city of Amagasaki, Hyogo Prefecture, to hold health checkups for residents at its six local outlets, the first such program in Japan. During the first event, scheduled for Oct. 20, a health-examination van will use the parking lot at one of the outlets, the company said. Lawson hopes to offer a health care app to members of its Ponta electronic point card system, possibly by next spring. The new service will enable them to register dietary, exercise and weight records and receive advice on how they can improve their...
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