7-Eleven closes around 450 failing stores in North America
Date
10/13/2024 8:41:20 AM
(MENAFN) Nearly 450 7-Eleven stores across North America are closing due to underperformance, according to the company’s latest earnings report. Seven & I Holdings, the Japan-based parent company of 7-Eleven, announced that 444 stores will shut down after experiencing a significant dip in sales, particularly in cigarette sales, as well as a decline in foot traffic and the impact of inflation. The company has not released a detailed list of the affected locations.
These closures represent about 3 percent of 7-Eleven’s portfolio of 13,000 stores across the U.S. and Canada. The convenience store chain has faced consistent challenges, with six consecutive months of declining traffic. In August alone, the chain saw a 7.3 percent drop in customer visits. These trends are occurring despite a generally robust North American economy, which has been buoyed by the spending power of high-income consumers. However, middle- and low-income groups have become more cautious with their spending due to ongoing inflation, high interest rates, and a challenging employment landscape.
One of the key factors behind the decline is the substantial drop in cigarette sales. Once a top revenue driver for convenience stores, cigarette sales have decreased by 26 percent since 2019. Efforts to shift sales to other nicotine products have not been enough to compensate for the lost revenue in this category. This change, coupled with broader shifts in consumer behavior, has contributed to the underperformance of certain stores.
In response, 7-Eleven is taking steps to adjust its strategy by focusing on its highest-performing category: food. The company plans to transform its stores to revolve around food offerings, reflecting the growing importance of this category as cigarette sales continue to decline. This strategic pivot is aimed at revitalizing store performance and aligning with changing consumer preferences.
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