2019 Volume 16 Pages 79-101
In 2017, 7-Eleven China (SEC) opened more than 100 stores, suggesting SEC may be taking off in the Chinese market. This study examines the SEC’s “Convenience Store Business System (CSB)” to identify the characteristics of this high-achieving business model format. Furthermore, this study clarifies the challenges in three aspects of the CSB from 2004 to the present day, and the countermeasures taken by SEC. In the “front system,” against the backdrop of a dramatically changing macro environment in Beijing, SEC gradually undertook innovation and localization. SEC had struggled for more than ten years with slow growth in the number of store openings. However, SEC reformed its franchise store contract policies in 2017 to facilitate openings. The current growth path is due to the resulting economies of scale, as well as the synergies generated by the “front system,” “background system,” and “store operations system”.
The innovation and localization of the “front system” has been the most important factor in success. Simultaneously in the “background system,” maintaining balance and support from both local and Japanese suppliers is crucial for maintaining competitive advantage with regard to product offer.
