San Beda College Department of Legal Management Strategic Management

Submitted by: DELA CRUZ, Jose Marco RADOVAN, Katreena Ysabel SANTOS, Nicole Jane BEJOSANO, Jose Ibarra DEL PRADO, Gelo

7-Eleven Convenient Store

OVERVIEW Philippine Seven Corporation (PSC) was registered with the Securities and Exchange Commission on November 1982. It acquired from Southland Corporation (Now 7-Eleven Inc.) of Dallas, Texas the license to operate 7Eleven stores in the Philippines in December 13, 1982. Operations commenced with the opening of its first store in February 29, 1984 at the corner of Kamias Road and EDSA Quezon City, Metro Manila. Considering the country's economic condition at that time, the company grew slowly in its first year of existence. Currently, the company had a manpower complement of 2,017 personnel, 856 of whom are regular employees, 1,159

contractual/probationary and part-timers to augment temporary needs during peak hours or season in the stores and the support services units. There is no existing labor union in the company and collective bargaining agreement. There is an Employee Council which communicates to management the employee concerns.

7-Eleven today is focused on redefining and enhancing convenience through strategic initiatives designed to take advance of new technologies and merchandising processes, but which remain based on the fundamental principle of the simple business concept it pioneered over 70 years ago - to provide customers an ever changing selection of quality products and services at fair everyday prices, through speedy transactions in a clean, safe and friendly environment. ISSUES 7-Eleven convenient stores have the following issues that need to be solved:

How can 7-Eleven edge their rivals considering the growing number of convenient stores nationwide?

What improvement can the company do with regards to their security services considering that there are a lot of robbery cases reported involving convenient stores nationwide?

INTERNAL ANALYSIS

Marketing

In

STRENGTHS terms

WEAKNESSES of
Although

the is the

marketing,

7-Eleven

company leading store

is at the forefront of all the convenient

convenient in the

stores in the country. It is the leading

Philippines, it doesnt do much of an

convenience store for the last 25 years in the Philippines. Selling

7-Eleven

advertising strategy when being it comes visible to to

is

not

television viewers. The prices of the products are a little bit high compared to the same products that you can buy to an ordinary sari-sari store.

lacking on gimmicks to attract more (e.g.

customers.

Election cups during the Management 2010 national hires

elections) 7-Eleven

flexible, trained, and fast employees that could Legal serve their

customers well. 7-Eleven have complied in all the legal requirements

There

Production/Operation

asked by law. 7-Eleven produces high personnel qualified that

are

still

household that

products not

are

perform business

all

the

available at 7-Eleven stores. these Some are of

activities

and transaction with its customer.

school

supplies that are in demand to students.

The company run

out Finance
The

of

stocks

sometimes. accounting department provides financial reporting

and analysis at every level.

A. Management 7-Eleven hires flexible, trained, and fast employees that could serve their customers well. With its new management, it implemented more operations designed to make the 7-Eleven the major (if not yet) player in the store industry. The Human resource department of the company is in charge of matters involving personnel recruitment. The selection, record maintenance and compensation of employees are its responsibility.

A. Marketing 7-Eleven is the leading convenience store chain in the Philippines for over 25 years, and became the countrys first franchisor in convenience retailing when we awarded our first franchisee in 1998. Today, over 300 stores are operated by our Franchisees; entrepreneurs and business partners who are dedicated to giving 7Eleven customers what they want when they want it.

1. Customer Analysis o Products and services offered by 7-Eleven are household necessities. With that, it attracts customers wants and desire offered by the company. With the services generated on this part helps a lot to develop an effective mission statement based on how the customer would like to be satisfied with the kind of service done. Being fast, open to the public 24/7, and giving quality service is a concept that helps 7-Eleven to incorporate this function to the mission and vision statement.

2. Selling o 7-Eleven is not lacking of marketing gimmicks. They have sales promotion that has draws and prizes, promotion of public image with their Election Campaign last May 2010. These are the companys way to promote its image to the public just to gain an advantage on penetrating a wider range of market.

3. Products and Services o Among 7-Eleven's offerings are private label products,

including Slurpee, a partially frozen soft drink introduced in 1967, and the Big Gulp introduced in 1980 that packaged soft drinks in large cups ranging in size from 20 to 64 US fluid ounces.

4. Pricing o Competitors and consumers and also support of the

government policies are major factors that affect the pricing decision of 7-Eleven products and services.

5. Marketing Research

o Marketing research and other feasibility studies by 7-Eleven is handled by the Market planning, training and market services department in which it administer support services of the store operation and formulation of marketing strategy and other forms of promotion. It reveals the strength and weaknesses as well as the external factors of its industry.

B. Finance/Accounting Apart from the personnel of 7-Eleven, the thing most necessary to keep the company running smoothly is a sound financial and technical operation. The accounting department provides financial reporting and analysis at every level, local store to the Store Support Center and manages payables and receivables, store revenue and rent, employee payroll and inventory. The information systems experts deliver innovative technology solutions throughout the company, encompassing retail information, supply-chain

management, and decision support and back-office operations.

C. Production/Operation
-

7-Eleven produces high qualified personnel that perform all the business activities and transaction with its customer. 7-Eleven also

develop more efficient personnel recruitment. And with its man power development programs, their marketing and operations department improves its employees skills to be more productive during operations.

Summary 7-Eleven should become more of a customer oriented store because most of its strengths are drawn from its customers. The company should take advantage of those strengths to become more effective on the market place and have a better edge on their competitors. With regards to the weaknesses, the company should address those issues so that they can have a better spot on the market place.

EXTERNAL ANALYSIS

Political

OPPORTUNITIES 7-Eleven can expand their stores out on some remote areas so that people can be more aware

THREATS The Value Added Tax (VAT) increase slightly affected the sales of 7-Eleven.

of it and at the same Economic time benefit from it. Due to the fact that the main items purchased eleven at 7are
Due to the slightly

higher prices of the products, customers tend to look for

stores

household necessities, sales of these not items be would directly by the

stores who offer a lesser price for the same products.

influenced

state of the nations economy or recent or

The

unemployment Social

consumption figures. Each stores selection up to 2,500 different and products is

increasing of

numbers

convenient store are slowly threat company.

The

services

becoming to

a the

tailored to meet the needs Technological local

customers. The information available their through

growing of

number

management

competitors who also

information systems also allows 7

uses

technological

advancements today.

Elevens vendors to anticipate needs and their prepare

and deliver items in a faster than expected time frame providing advantage Eleven, to 7

their

customers and their Environmental vendors. There are proper disposal every stores. place in
Some products are

not

environmental such and as the

7-Eleven

friendly cigarettes likes.

1. Political The increase in Value Added Tax (VAT) was introduced into the Philippines and acted as a turning point which slightly decreases the sales of 7-Eleven stores. The VAT was essentially about paying for the Philippines indebtedness.

2. Economics Although it is evident that the state of the nations economy directly impacts on spending patterns and consumer

confidence levels, it can be argued that this has a lesser effect on 7eleven stores than other grocery and retail sectors. This is mainly due to the fact that the main items purchased at 7-eleven stores are household necessities and sales of these items would not be directly influenced by the state of the nations economy or recent unemployment or consumption figures. Currently the Philippine economy is experiencing a period of negative growth however, this is likely to have a larger impact on supermarkets who stock items other than necessities compared to 7 Eleven.

3. Society 7-Eleven focused on meeting the needs of convenience-

oriented customers by providing a broad selection of fresh, high-quality products and services at everyday fair prices, speedy transactions and a clean, safe and friendly shopping environment. Each stores selection up to 2,500 different products and services is tailored to meet the needs local customers. 7-Eleven is expanding its food offerings to bring consumers a proprietary line of daily-prepared and daily delivered item and baked goods. However, it also offers consumer a number of convenience services designed to meet the unique needs of individual neighborhoods including fax machines and automatic teller machine.

4. Technological The time distribution system provides competitive

advantage on two fronts, the ability to utilize the small spaces in the Philippines retail outlets and to be able to provide customers with a greater range of products more accurately catering for their needs. The information available through their management information systems not only assists in building relationships with their customers, it also allows 7 Elevens vendors to anticipate their needs and prepare and deliver items in a faster than expected timeframe providing advantage to 7 Eleven, their customers and their vendors.

Summary The most significant environment trends for 7-Eleven stores are social and economic. The two goes hand in hand if the company wants to be more successful. The social needs of the customers will be met if the economic needs are met. This statement means that the products that should be present at the company stores are the products that the customer needs.

STRATEGIC ACTIONS