Is 7-Eleven's New Standard Store the Future of Convenience?
In this Fast Five Short sponsored by the A&M Consumer and Retail Group, Avalara, Mirakl, Ownit AI, and Ocampo Capital Chris Walton and Anne Mezzenga discuss how 7-Eleven is set to open over 600 new stores by 2027, featuring a contemporary design focused on food offerings and customer experience. These new "standard" stores will build on the learnings from their previous Evolution store concept, introducing expanded food and beverage selections, in-store seating, and electric vehicle charging stations. The discussion delves into the implications of this shift for the convenience store and quick-service restaurant (QSR) industries, highlighting the importance of adapting to changing consumer demands. The hosts reflect on their experiences at an Evolution store, noting how 7-Eleven is investing significantly in infrastructure to enhance customer convenience, including mobile checkout options. As they explore the potential impact of these developments, the conversation underscores the need for both industries to stay vigilant and responsive to evolving market trends.
A seismic shift is underway in the convenience store landscape, exemplified by 7-Eleven's bold plan to open over 600 new stores in North America by 2027. This initiative introduces a new prototype known as the 'new standard stores,' which emphasizes a contemporary design and an extensive range of food and beverage offerings. The hosts of the podcast delve into the significance of this development, noting that it marks a departure from traditional convenience store models that have historically focused on quick snacks and fuel sales. Instead, 7-Eleven is positioning itself as a serious player in the food service sector, with features designed to enhance the customer experience, such as in-store seating and electric vehicle charging stations.
The discussion also explores the implications of this strategy for the convenience store and QSR industries at large. By taking lessons from its previous Evolution store concept, 7-Eleven demonstrates a commitment to learning and adapting in response to consumer demands. The hosts highlight the potential for these new stores to attract repeat customers, not just for quick purchases but for a more engaging shopping experience. As convenience stores increasingly compete with QSRs for consumer attention, the podcast raises critical questions about the future of retail and the need for innovation to remain relevant in a fast-evolving market.
The insights shared by the hosts emphasize the importance of investment in infrastructure and technology, particularly in relation to food offerings and customer service enhancements. With 7-Eleven's focus on kitchen build-outs and mobile checkout options, the conversation suggests that convenience stores are redefining their roles within the community. This episode encourages listeners to consider how such changes might influence their shopping habits and the competitive dynamics between convenience stores and fast-casual dining options. Ultimately, the episode paints a picture of a retail landscape that is rapidly evolving and invites its audience to pay close attention to the developments ahead.
Takeaways:
- 7Eleven plans to open over 600 new convenience stores with a contemporary design by 2027.
- The new Standard C stores will focus on a larger food assortment and enhanced beverage options.
- Joseph DiPinto emphasized that the design leverages insights gained from previous Evolution store prototypes.
- Investments in kitchen infrastructure and mobile checkout capabilities are key components of the new store format.
- The introduction of in-store seating and electric vehicle charging stations marks a significant shift in convenience retailing.
- The new format reflects a strategic response to declining fuel and tobacco sales in the convenience store sector.
Companies mentioned in this episode:
- 7Eleven
- Laredo Taco
- Del Taco
- Jack in the Box
- Gelson's
- Amazon
- Wayfair
For the full episode head here: https://youtu.be/xJqW3cfOfRM
This podcast uses the following third-party services for analysis:
Podcorn - https://podcorn.com/privacy
Transcript
These locations will showcase a new prototype the company internally calls its standard its new standard stores.
Speaker A:They are quote, more contemporary facilities, end quote, that offer, quote, a large product assortment and expanded food and beverage offerings compared to the rest of its stores.
Speaker A: lution store concept in March: Speaker A:Those locations featured Seven Eleven's Mexican QSR Loretto Taco, as well as made to order specialty beverages, self serve specialty coffee, a cold treats bar, mobile checkout and delivery capabilities.
Speaker A:Seven Eleven CEO and Omnitalk fan Joseph DiPinto said on Thursday that Seven Eleven has, quote, leveraged key learnings from its Evolution stores over the past few years and that beyond the increased food and beverage offerings, the new Standard C stores feature, quote, many of the same elements of the Evolution stores as well as in store seating and electric vehicle charging stations.
Speaker A:And this is also the A and M put you on the spot question this week.
Speaker A:Oh boy, better you than me on this one.
Speaker A:All right.
Speaker A:Will Seven Eleven's new format be the move the convenience store industry needs to lessen?
Speaker A:Its dependent on historically declining fuel and tobacco volumes and how much should QSR players be looking over their shoulder to see what happens?
Speaker A:God, they're so good.
Speaker B:They are.
Speaker B:I mean it.
Speaker B:This reminds me of like when we left the next the national association of Convenience Stores Conference last year.
Speaker B:Chris.
Speaker B:I mean Chad and the team at AM are hitting on the exact question that I think was on top of everyone's minds when we left that show because these, these fueling stations are definitely doubling down on these QSR concepts and really making that their growth opportunity to like make sure that they have a reason for you to come to their location time and time again, whether you're filling up with gas or it's just the most convenient option.
Speaker B:So I mean I'm really, I think this story is important and I'm really going based off of what we saw five years ago.
Speaker B:Chris.
Speaker B:We went to this Evolution store in Dallas five years ago.
Speaker B:They have five years of learning that they've put into these new concepts and they're scaling this to 600 stores.
Speaker B:So I think it's absolutely something that the convenience and QSR industries need to be paying attention to.
Speaker B:I Mean, they are making massive investments here.
Speaker B:We are seeing investments in like kitchen build outs to support the Laredo Tacos.
Speaker B:They are putting in new fixturing and infrastructure to support things like mobile checkout and scan and go and in the future, possibly even entry and exit that would be controlled.
Speaker B:They're doing, you know, setting up better throughput for the delivery of fresh food items and then the supplies for the restaurant.
Speaker B:And then finally they have to really be thinking, and they did in the store that we visited in Dallas, about accommodating seating and an environment where people can stay.
Speaker B:Now that EV chargers are a component of this, and we're really not seeing that with many other C store retailers yet, with the exception of maybe Gelson's that's piloting this out in California.
Speaker B:But I think that what this investment, the pure investment that seven eleven is making here is a reason for us to be paying attention to this both in the C store space and in the QSR space.
Speaker B:Because I think that there's a lot of room and seven Eleven is betting on this being their growth engine for the future.
Speaker B:But where do you land?
Speaker B:I mean, what were your thoughts when we were in that store in Dallas?
Speaker A:Yeah, I think my thoughts are similar.
Speaker A:And honestly, I'm dying to ask Chad Lusk, who potentially is the originator of this AM question and a former C store operator, what his take is on his question.
Speaker A:But, you know, I think it's something that everyone has to be paying attention to.
Speaker A:And the key, the reason I say that is I think the, the key here lies in the names that seven eleven is using.
Speaker A:They're going from evolution, taking the lessons learned from that.
Speaker A:Which, by the way, learnings is not a word.
Speaker A:I hate when people say that.
Speaker A:It's lessons.
Speaker B:Sorry, learning.
Speaker A:No, it wasn't you.
Speaker A:It was in the article.
Speaker A:The article said learnings.
Speaker A:And then we all do it.
Speaker A:I do it all the time too.
Speaker A:So it's no big deal.
Speaker A:But it's just a little pet peeve of mine.
Speaker A:But they're taking the lessons learned from that and now calling this new format the new standard, which tells me this store is actually just an evolution against the trends 711 is seeing.
Speaker A:Like what you named, like EV charging, expanded food and beverage offerings, which, as you said, we heard at nax, we shot a video of their Evolution store.
Speaker A:It was really impressive.
Speaker A:We'll try to include it in the show notes as well.
Speaker A:But.
Speaker A:And the other point that I'd make is it seems like the right way to experiment when you're talking about retail physical footprints, design big and bold, and then work backwards.
Speaker A:Which is an interesting approach when you compare it.
Speaker A:In contrast to, like, how Wayfair tried to experiment with their stores, how Amazon's been trying to experiment with their stores and grocery.
Speaker A:I actually like this approach a lot better because you spend a little bit more upfront, but you get better answers in the long term and you see what's possible.
Speaker A:So.
Speaker A:And then the other point about this is they must have the confidence that it works, right?
Speaker A:They're thinking this is going to work.
Speaker A:If they're going out publicly and saying 600 stores, we're going to build 600 stores with this in a pretty short time horizon, too.
Speaker A:This is not like targets.
Speaker A:We're going to build X number of stores in 10 years baloney that they're putting out there.
Speaker A:So.
Speaker A:So that.
Speaker A:That's my take, I think.
Speaker A:I think the whole.
Speaker A:I think QSR and the convenience store industry both have to take a close look at this to see how.
Speaker A:How things are still evolving.
Speaker B:Now you got me craving a Laredo taco, Chris.
Speaker B:Early in Laredo.
Speaker A:Or.
Speaker A:Or a Del Taco.
Speaker B:God, no.
Speaker A:Or not Jack in the Box taco.
Speaker B:Oh, my God.
Speaker B:Now you're just spouting off QSRs.
Speaker B:I was, like, sticking with the 711 one.
Speaker B:Whatever.
Speaker A:I am a big QSR fan, Ed.
Speaker A:That is, you know, that.
