Abstract

This case illustrates the business strategy of the famous store 7-eleven, which started its operation in the US. It identified the gap in the market as there were no convenience stores which were open late at night, and this had become a problem for the people in the US due to their busy lifestyles. 7-eleven addressed these issues by opening the stores from 7am to 11pm. It gradually increased its product offering from daily necessity products such as eggs, bread and milk, grocery items, juices, ready-made food and kitchen items. In US, the location of the store was horizontal, as it was all residential area at one end and urban areas on the other end. Moreover, the stores had different locations within the same region while allowed the company to gainmore customer footfall and develop strongposition andmarket development strategy in the US Market.

However with the success of the conveniencecentermodel in US, manyother players like gasolineproducers, restaurants and other retail stores startedpursuing the SevenEleven model. This greatly disturbed the cash flow team of Seven Eleven anddroveaway the basic competitive edge and value proposition from the business.Such resulted in bankruptcy of Seven Eleven in US. In such situation, now the company has to decide the future strategy for the sustainability of the business in the US market, whileimproving its value proposition even in the presence of suchintense competition.

Keywords: Market development, Positioning, competitive edge

Seven Eleven Inc. Harvard Case Solution & Analysis

Introduction

The companySeven Eleveninitiated its business in 1967, in Southland Dallas, under the convenience model.The companyinitiatedthesame model in USA which it initiated in Japan. Thebusiness became successful with the period of time, since it matched and integrated with the busylifestyle and on-the go shopping nature of the US population.

Over the period of time, Seen Elevenincreased its offering from innately offeringbread, butter eggs and other small groceryitemsto gasoline refillingand ticketsfor moviesand lottery.It catered the customers from morning7to 11 in night, and hencenamed itselfSeven Eleven store. Since at that time, theusual stores remain close after 7 in evening, this gavethe Company a competitive edge over the other retail stores and allowed the business to establish its own value proposition and positioning in the market.

In catering the US market, the company copied the similarofferings model as in Japan, in doing so, it recently started its fresh food meals in US, though in the current stage, such SBU of the portfolio constitutes only 10% of the totalSevenEleven sales, however, the management is positive about the success of SBU in the near future.

Though till now, the model has sustained, however, with the growing competition from the retail stores and gasoline pumps and emergence of the new entrants into the market with the similar convenience store model, the sustainability of the business is under jeopardy. Also, since the Japanese and American markets behave in different manner and have different fooding habits, the success of the Fresh meal model is still under question. In such situation, the company has to decide how to sustain its new offering in the market and also retain its customer base even in the presence of strong competition................

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