Hrm533 7-Eleven Case Study Report

Introduction

The retail industry can be defined as the sale of daily necessities of goods or services to consumers or customers (Gary, 2005). There are various types of retail operations, such as street vendors, supermarkets and large business centers. For this case study, we have decided to study retail business namely 7-Eleven, specify 7-Eleven Malaysia Sdn. Bhd. 7-Eleven Malaysia Sdn. Bhd. is the owner and operator of all their stores in Malaysia. It was established on 4 June 1984 and has become a well-known retail icon for over 35 years. In fact, 7-Eleven Malaysia is the pioneer and operator of the 24-hour multi-functional convenience store in Malaysia. When 7-Eleven Malaysia has achieved great success, they open their business space to local entrepreneurs through a franchise program in 2009. With the largest network to owners in the convenience store sector over 2240 stores nationwide, 7-Eleven Malaysia has served more than half a million customers a day. The emergence of 7-Eleven as a retail business has given a fierce rival to local competitors such as Speed Mart and Orange. Despite offering a range product similar to their competitors, yet 7-Eleven is still able to reduce the price of goods and generate the profits. In summary, here is an overview of 7-Eleven Malaysia marketing strategy that has led to success:

• Wide range of halal products for market targets
• Understand the customers’ desire to develop a low-price strategy
• Aggressive in placing business premises in a competitive location

History of 7-Eleven

7-Eleven, also called as 7-E, is a franchise from Texas, USA. The history of 7-Eleven establishment began when the employee of Southland Ice Company, John Jefferson Green, sell eggs, milk and bread from one to 16 ice house storefronts in Dallas, with permission from one of the Southland’s founding directors, Joe C. Thompson, Sr. Although small grocery stores and general merchandise were available, Thompson theorized that selling products such as bread and milk in convenience stores would reduce the need for customers to travel long distances for basic items. The company’s first outlet was named as “Tote’m Stores” because customers ‘toted’ away their products. In 1946, the chain’s name was changed to “7-Eleven” to reflect the company’s new business hour, 7:00 am to 11.00 pm, seven days per week. The company flourished with success when in 1952 it opened its 100th branch outlet. In 1961, it was incorporated as Southland Corporation in 1961. A year later, 7-Eleven had changed the business hour where to open 24-hour stores in Austin, Texas, followed by Las Vegas, Forth Worth and Dallas in 1963. In 1980, the company experienced financial difficulties which had sold the ice packing company. Due to problem that 7-Eleven might bankrupt, the company transfer control 70% of the company to Japanese affiliate Ito-Yokado. The Japanese company fully controlled 7-Eleven in the early of 90’s which made reform by opening over 1000 franchise in USA (Mary & Brown, 2013). In 1999, Southland Corporation changed its name to 7-Eleven, Inc., citing the divestment of operations other than 7-Eleven. Ito-Yokado formed Seven & I Holdings Co. and 7-Eleven became its subsidiary in 2005.