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1、7-Eleven in TaiwanYuko MatsumuroNational Chengchi UniversityAbstractNowadays, convenience stores have become more and more common in Taiwan. If you just look around everywhere, you will soon find there are a lot of convenience stores surrounding your town. Among several convenience store chains, 7-E
2、leven, or the President Chain Store Corporation, is the most popular one now. The paper focuses on why 7-Eleven is so successful in Taiwan and pursuits what is behind it. At the beginning, to understand the position of 7-Elevens parent company Uni-President Enterprise Corporation (UPEC) in Taiwan, a
3、nd investigate how it influence the success of 7-Eleven. Also, based on the data which showed the consumers satisfaction towards 7-Elevens service, to consider how 7-Elevens service performances are evaluated by consumers and what kinds of management manuals they have. In last, the paper will discus
4、s the influences of 7-Elevens special marketing geographical strategy and their advertisement effects on consumers. These information will help us know why 7-Eleven can continue to improve.Why 7-Eleven succeed in Taiwan?Introduction According to the article “Taiwan Convenience Stores 2010”, “In 2009
5、, Taiwans four major convenience store chains such as 7-Eleven, Family Mart, Hi-life, and OK operated a total of 9,184 stores around the country, a density of one store per 2,500 people, making Taiwan the densest market in the world in terms of convenience stores.” Among several convenience store ch
6、ains, 7-Eleven is the most popular one in Taiwan now. To think about the history of Taiwanese convenience stores, according to the article “The Development and Trend for Convenience Stores” from Managing Convenience Stores Theories, the Uni-President Enterprise Corporation (UPEC) had contributed the
7、 great role to the development of convenience store in Taiwan (Department of Economy, 2000). “In May 27, 1979, UPEC stated with fourteen chain stores and in this year, UPEC cooperated with the Southland Corporation, having the longest history and the biggest chain convenience store Company in South
8、America, imported 7-Eleven to Taiwan” (Department of Economy, 2000). The first 7-Eleven in Taiwan opened in 1980 with 27 stores and the sale of this year was just only NTD 1.2 billion. Although 7-Eleven grew 62 stores in 1984, the sale still did not improve a lot, and 33 stores had been closed in th
9、is year (Lu and Luo, 2010). Nevertheless, the 7-Eleven company did not stop to increase the number of stores; in 1987 they started to work 24 hours with all 168 stores. Since this turning point, 7-Eleven started to expand their business and in April 2010, 7-Eleven expanded with 4733 chain stores wit
10、h a sale of NTD1017.6 billion in a year (Lu and Luo, 2010). This paper will explore these following questions: 1. Why 7-Eleven is so successful in Taiwan? 2. Does 7-Elevens parents company the Uni-President Enterprise Corporation (UPEC) role relates to the success of 7-Eleven? 3. What kinds of strat
11、egies 7-Eleven has?It is valuable to study why 7-Eleven can continue to improve and understand their strategies and backgrounds.What is the Uni-President Enterprise Corporation (UPEC)? First of all, to understand the position of 7-Elevens parent company Uni-President Enterprise Corporation (UPEC) in
12、 Taiwan, and investigate how it influence the success of 7-Eleven. According to the article “The Revenue for UPEC in April is 41.92 billion and increasing annually by 7.41%”, “The whole profit-making of UPEC in April recorded NT41.92 billion, its increased 7.41% from last year at the same time” (Yan
13、g, 2011). Uni-President Enterprise Corporation (UPEC) is the only company in Taiwan, which has many kinds of food manufacture branches, and dozens of products can be made through only one branch (Chang, 2006). Major domestic subsidiaries of UPEC are such as 7-Eleven, Starbucks Coffee Company, Mister
14、 Donuts, Muji (Taiwan) Co., President Drugstore Business Corp. (COSMED), President Transnet Corp., Semeur De Pain and so on. We can see there are so many subsidiaries under the UPEC and each of them quite popular companies in Taiwan now. “While adequately integrating the subsidiaries of retail, logi
15、stics and recreational service companies within the group, rapidly expanding its business territory” (Uni-President, 2007). The subsidiaries of UPECs business tie-up increased their business territory, and made UPEC more powerful company. In 2005, the profit-making of the food industry UPEC exceeded
16、 over NTD 1,000 billion” (Chang, 2006). The food industry of UPEC is one of famous company in Taiwan, if you look around 7-Elevens food categories, you will soon found a lot of them are from its company. Now, we know such big food industry behind 7-Eleven, is it related to the success of 7-Eleven?Fo
17、od is important role in convenience store In the article “The Almighty Convenience Store, 7-11 and Family Mart Competes”, E-IPC, the research of Taiwanese people whose frequency to visit convenience stores which stated from 1988, suggested those who answered once a week was 53.1% in 1995; in 2009, t
18、hose who answered to go there every week was 84.7%, among them, the sum of those who answered three times a week and once a week was 50%, answered going everyday was 34%, surprisingly, those who answered visited over twice a day was 7.3% (M, 2010). The age of main consumers who spend money in conven
19、ience store is 13 to 64, the E-IPC in 2006 to 2009, shown that those who answered visiting there every day was increased 30.8 to 34% (M, 2010). From the data, we can see nowadays people visit the convenience stores more often than before. Then, what kind of people have become regulars nowadays? The
20、article shows that the Taiwanese population is mostly working class; they at least buy two takeout meals per day, and these two meals are mostly breakfast and lunch (M, 2010). Now, we know the main consumer of convenience store is the working class people and their needs are food. According to the a
21、rticle “Local Convenience Stores development and future in 2008”, the data of “The Private Brand of four big convenience stores in Taiwan”(Table 1) shows that 7-Elevens main products such as “Drinks, fresh food, snacks, coffees, daily commodities”, all of them comes from UPEC company or their own 7-
22、Eleven brands (Wang. 2008). As to Family Mart, their main products are the “Fresh food and drinks”, Hi-Lifes are the “Fresh food and dairy products”, and OK is the “Fresh food” (Wang. 2008). Only Fresh food come from their own brands in Family mart, Hi-Life, and OK, and we can see 7-Eleven has more
23、many kinds of main products than others because of the support of UPEC.Table 1The Private Brand of four big convenience stores in Taiwan (2008)CompanyBrandsMain productsNotes7-Eleven7-11做選素材原味覺醒CITY CAFDrinks Fresh foodSnacks Coffees Daily commoditiesAll products come from UPEC company or their own
24、7-Eleven brandsFamily MartFamiDrinks Fresh foodFresh food comes from their own Fami brandHi-lifeHi-lifeDrinksDaily commoditiesFresh food comes from their own Hi-life brandOKOKFresh foodFresh food comes from their own OK brand “Extended menu offerings have successfully increased the importance of con
25、venience stores foodservice offering. The company derives its share from its convenience stores, under the brand 7-Eleven. At the end of 2009, there were 4,750 outlets,” 7-Eleven may be considered to be the pioneer in introducing convenience stores fast food in Taiwan, and has since constantly innov
26、ated with the launch of new products (Euromonitor international. 2010). Besides, “Family Mart said the sale of fresh food items currently accounts for only 12 percent of its revenue. In Taiwan, the industry average is 20 percent” (Business weekly. 2010), compared with other convenience stores, Famil
27、y Mart provides less food and it may give distance with 7-Eleven high sale because peoples needs are food. Then, how does the CVS chain store attracts the customers and creates non stopping motives for them to buy? There are two prospective on this; one is the products that they are currently sellin
28、g. With the penetration of the stores, expanding their takeout meals market is also an important marketing strategy (M, 2010). Therefore, the convenience stores targets the timing to do marketing strategies or other promotional plans. For example, in 7-Eleven, drinks and breakfasts are only 39 NTD t
29、o promote their products (M, 2010). Internal business management of 7-ElevenAccording to the date of “The Benchmarking Companies of Digital Service in 2011”, 7-Eleven, or the President Chain Store Corporation, ranked the top in retailer category, it can say consumers are satisfied to the services of
30、 7-Eleven (He and Yang, 2011). From this date, we can consider why 7-Elevens service performances are evaluated by consumers and what kinds of management manuals they have. According to the book of “Successful CVS Strategies” by Chen Kuang in 2006, stated the detailed and specific personal managemen
31、t is 7-Elevens basic concept. There are three main management concepts of 7-Eleven such as work refinement, formal management, and the core value to the consumers. First of all, the feature of 7-Elevens staff management is refinement work. For example, as to cleaning, “there are many stores are requ
32、ired to do cleaning but less stores have cleaning process and every department has its own regulations, 7-Eleven is such convenience store”(Chen, 2006). Even though cleaning which parts in what time, the way or the order to clean, using which tools to clean, all of which are written in their managem
33、ent regulation, and workers should be follow it every day. Their regulation is including such as cleaning of doors, floors, around of sales counter, electric lights, parking areas, public telephone outside the store, and so on (Chen, 2006). As to formal management, “Working Progress reports are writ
34、ten by every staff everyday, which can make the staff clearly understand when to do what at where and how” (Chen, 2006). Also, 7-Eleven execute working progress report for every worker once a time, which includes evaluation of oneself or other workers (Chen, 2006). Also, the customers core value is
35、to provide and support how 7-11 should run the business. They consider to receive the consumers heart is important for their value and the growth for the company. “For example, 7-Elevens staff cannot answer “I dont know” for their consumers question. They should say Could you wait me for a while, Il
36、l check it, or Can I ask your phone number? Ill contact you if I know the result” (Chen, 2006). They also have seven technical words which should say if they meet the consumers such as regular greetings, please watch your step, and take care. We can see the 7-Elevens personal management is really de
37、tailed which increase their work efficiency; also their regulation requires staff to be precise in work and have the right behavior toward the consumers. Such 7-Elevens management may lead to the consumers satisfaction. Staff training and evaluation are also the important part of 7-Elevens internal
38、management. 7-Eleven has three training center in Taiwan such as Taipei, Taizhong, and Kaoshiung, where trains the new staffs knowledge, attitude, skills, and abilities. “The new staffs take training classes for the first four and a half day and one left to do retail sales practice”(Chen, 2006). In
39、addition, “7-Eleven training materials are renewed in every six months” which we can see 7-Eleven changes their management manual depends on the society condition or peoples need. As to managers training and evaluation of promotions, “the 80% to 90% of 7-Elevens senior management employees were rais
40、ed from the basic unit staff to be promoted” (Chen, 2006). For example, if a graduate college has performed well in the basic unit staff, he will be the vice manager in three years (Chen, 2006). Employing people in the promoting way, which can maintain stable management, decrease employees fluidity.
41、 The workers done need to worry about their future at the same time training rich experience staff workers. Marketing Geographical of 7-Eleven“Taiwan is a high dense populated region, it has limited for the growth of big stores, and they cannot establish their companies easily. However small stores,
42、 especially convenience store, has more possible to be future development mainstream” (Department of Economy, 2000). As we know convenience stores in Taiwan has been increasing their marketing territory nowadays. According to the article “The Comparison of 7-11 President Convenient Chain Stores, Fam
43、ily Mart Convenient Chain Stores and Hi-life Convenient Chain Stores”, the research of the main convenient chain stores in Taiwan in 2007 showed that “7-11 President Convenient Chain Stores was on the top of the rank, which owned 51.87% of the market; Family Mart Convenient Chain Stores owned 24.56%
44、 of the market ,and Hi-life Convenient Chain Stores owned 14.33% of the market” (Workshop of Starting your own business with joining Chain Stores, 2008). 7-Eleven shares more than half of the convenience store market in Taiwan, and has raised its publicity. However, they are not only increasing the
45、number of stores, but also having the strategies to set up it. “According to the Statistic suggested that the condition of location influences the stores success of 60%” (Chen, 2006). To see 7-elevens geographical condition and learn their three important strategies such as confirmation of business
46、place, Choosing the right place, and address and evaluations. Confirmation of business place refers “the basic investigation of business place and know their competitive market” (Chen, 2006) For example, the residential area is more stable for stores profit. The next, choosing the right place means
47、that 7-Eleven always set in the consumers daily routes such as on the way of going to the work or school, parks, and so on. Also, address and evaluations is that the condition of population density or using the rate of success to calculate if the store should be establish or not (Chen, 2006). 7-Elev
48、en always investigate the place deeply, to understand either the place can lead 7-elevens success or not. Moreover, the central construction is also one of 7-Elevens geographical strategies. It will consider four major effects from central construction that is decreasing the budget of advertising, i
49、ncreasing the image of the business, being controlled better and the quality would be better, and increasing the efficiency of delivery and decrease the amount of money and time spend on it (Chen, 2006). For example, our school National Chengchi University, we can find three 7-eleven inside the school ca