Seven & i Corp.
JMR has just issued an update to its Seven Eleven Holdings case available
here (in Japanese) for subscribers to the Japanese site. Key points for the most recently ended fiscal year are discussed here.
Although Seven Eleven Japan's consolidated sales climbed to Yen 2.7 trillion (+0.8 YoY change) for the fiscal year ended 2/2010, it suffered a massive decline in revenue, down about 12.8 percent on a year-on-year basis. As of Feb. 2010 Seven Eleven operated 12,753 stores in 38 (out of 47) prefectures in Japan. This is an increase of 455 stores compared to the previous year. Newly opened stores numbers was at an all-time high of 966 branches. Overall, rising customer visits (up 0.5 percent), were damped by a decline in sales per individual customer (down 2.6 percent). On an existing store basis (open more than 12 months) sales declined by 2.1 percent. The negative numbers were largely the result of the overall economic conditions, unstable summertime sales and the costs of introducing an electronic ID system to prevent minors from buying tobacco. Profits were also impacted by the headquarter's costly promotion campaigns to support affiliated stores. These activities included such as its "Yen 100
Onigiri (rice ball) campaigns," the headquarter cost sharing (15 percent) for loss-makers such as
bentos (boxed lunches), losses due to food disposals and rising rent prices for newly opened stores in metropolitan areas.
Tracing its origins back to an American convenience store franchise, Seven-Eleven is now wholly Japanese owned and one of the biggest and most innovative businesses of its kind in Japan. In recent years however, fierce competition from alternative business models such as the Yen 100 Lawson stores and the overall consumers' spending mood influenced by the worldwide economic downturn have hit Seven Eleven hard. For this reason, Seven Eleven is one of several convenience stores in Japan that recently started to incorporate point card systems (such as the
nanaco e-money card) in order to counteract competitive threats, increase shopper loyalty and to spur sales.
Sample of page 1 of the case
to enlarge click picture
