Seven-Eleven Japan Co. Analysis on Supply Chain
Seven-Eleven Japan Co. Analysis on Supply Chain
1. OutlineHistory & ProfileStrategy & Tactic of Seven ElevenFood Items ClassificationConvenience at the StoreSchematic Representation of the Supply ChainSupply Chain FrameworkSupply Chain Drivers AnalysisCase Questions Discussion
2. History and ProfileFounded by Masatoshi Ito post 2ndWorld War.By 1960, the single store had grown into a $3 million company.In 1961, realized that superstores were the wave of the future.In 1972, approached Southland Corporation .In 1973, Southland agreed to a licensing agreement.In 1974, first 7-11 convenience store opened in Tokyo.In 1990, Southland Corporation entered into bankruptcy protection.In 1991, IYG acquired 70% of Southland’s common stock.
3. Number of Stores ofSeven-Eleven in Japan
4. Annual Sales in Billion Yen of Seven-Eleven in Japan
5. So how did 7-eleven manage such phenomenal growth?
6. 7-Eleven Japan’s Competitive StrategyTo provide high-availability of a variety of reasonable quality products at reasonable prices
7. Strategy & Tactic of Seven ElevenStrategy of 7-Eleven JapanMarket DominanceCluster of stores (50-60) in small geographical area supported by a Distribution Centre (DC)TacticCombination of Own and Franchisee StoresIn 2004 Franchisee Commissions accounted for 68% of Total revenue from operationsBy 2004, the company had presence in 70 prefectures of Japan
8. Advantage of Dominance StrategyHigh Distribution EfficiencyBrand AwarenessSystem efficiencyFranchisee Support ServicesAdvertising effectivenessEntry barrier for competitorsContinued
9. Store Size was 150 square metresAverage inventory at store of 3000 Stock Keeping Units (SKU), with max capacity of 5000 SKUsEmphasis on regional merchandizingGoods included:Food ItemsBeveragesMagazinesSoaps, Detergents etc.Game, SoftwareContinued
10. Food Items ClassificationChilled temp item.Sandwiches, sweets, milkWarm temp item.Box lunch, rice balls, fresh breadFrozen itemIce cream, Ice cube
1. OutlineHistory & ProfileStrategy & Tactic of Seven ElevenFood Items ClassificationConvenience at the StoreSchematic Representation of the Supply ChainSupply Chain FrameworkSupply Chain Drivers AnalysisCase Questions Discussion
2. History and ProfileFounded by Masatoshi Ito post 2ndWorld War.By 1960, the single store had grown into a $3 million company.In 1961, realized that superstores were the wave of the future.In 1972, approached Southland Corporation .In 1973, Southland agreed to a licensing agreement.In 1974, first 7-11 convenience store opened in Tokyo.In 1990, Southland Corporation entered into bankruptcy protection.In 1991, IYG acquired 70% of Southland’s common stock.
3. Number of Stores ofSeven-Eleven in Japan
4. Annual Sales in Billion Yen of Seven-Eleven in Japan
5. So how did 7-eleven manage such phenomenal growth?
6. 7-Eleven Japan’s Competitive StrategyTo provide high-availability of a variety of reasonable quality products at reasonable prices
7. Strategy & Tactic of Seven ElevenStrategy of 7-Eleven JapanMarket DominanceCluster of stores (50-60) in small geographical area supported by a Distribution Centre (DC)TacticCombination of Own and Franchisee StoresIn 2004 Franchisee Commissions accounted for 68% of Total revenue from operationsBy 2004, the company had presence in 70 prefectures of Japan
8. Advantage of Dominance StrategyHigh Distribution EfficiencyBrand AwarenessSystem efficiencyFranchisee Support ServicesAdvertising effectivenessEntry barrier for competitorsContinued
9. Store Size was 150 square metresAverage inventory at store of 3000 Stock Keeping Units (SKU), with max capacity of 5000 SKUsEmphasis on regional merchandizingGoods included:Food ItemsBeveragesMagazinesSoaps, Detergents etc.Game, SoftwareContinued
10. Food Items ClassificationChilled temp item.Sandwiches, sweets, milkWarm temp item.Box lunch, rice balls, fresh breadFrozen itemIce cream, Ice cube