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7-Eleven, Inc., with over 67,000 convenience stores in 17 countries, has signed a master franchise agreement with a Future Retail Ltd arm, SHME Food Brands Pvt Ltd, to develop and operate 7-Eleven outlets in India. The retailer has been exploring an India entry since 2004, when it was in talks with Delhi-based Modi Enterprises.
The first 7-Eleven store will come up in Mumbai this year and will be open 24 hours wherever possible. SHME will open new 7-Eleven stores as also convert some of its outlets to that brand.
A convenience/corner store is a small retail business that is usually open until late or round-the-clock, stocking a range of everyday items. Some are also licensed to sell alcohol. Many of them are part of a petrol station so customers can buy while tanking up.
Kishore Biyani, Future Group Founder and CEO, told BusinessLine: “7-Eleven stores will be located in high traffic neighbourhoods, corporate parks, hospitals, transit points, colleges... We will have fresh, hygienic food and takeaways, snacks, confectionery items, and tobacco products. Munchies are big today, so we will have a lot of chips and munchies too. We will also have milk and dairy products from New Zealand-based Fonterra with whom we have a joint venture.” .
2,000 sq ft facility
The store size will range from 1,200 to 2,000 sq ft with the latter format also serving as cafés.
Asked if there was scope for a new format when existing stores were struggling with low sales per sq foot, Biyani said: “The new consumption market in India is an $80-billion per annum market, so there is enough scope.”
7-Eleven, known for its brands such as Slurpee, Big Bite and Big Gulp, will marry its expertise in convenience retailing with Future Group’s understanding of the Indian market and consumer.
The stores will also offer immediately consumable fresh foods with recipes developed for local tastes including many from Future food brands like Tasty Treats, Pooofs, and Terra.
7-Eleven will compete with 24Seven, the convenience store chain promoted by Modi Enterprises, and BPCL’s In & Out outlets.
Arvind Singhal, CMD of Technopak, feels the $750-billion retail market, which is growing at 10-11 per cent YoY, has room for a convenience format because of the emergence of new categories of consumption and the changing consumption pattern, driven by millennials and knowledge workers, who want food, beverages, OTC medicines on-the-go, 24x7. “Convenience stores can be fitted as a 500-1,000 sq ft plug-and-play format in corporate offices, residential complexes, transit points, etc.,” he said.
Future Retail has 1,800 stores in over 270 cities across India.
“7-Eleven stores will be located in high traffic neighbourhoods, corporate parks, hospitals, transit points, colleges...”
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