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JANUARY 2016
7-ELEVEN FRANCHISE OWNERS ASSOCIATION OF CHICAGOLAND
Once Again Vendors Are Put on
the Spot and Franchisees Suffer:
It’s an added burden
By Hashim Syed,
FOAC Member and Vice
Chairman of the NCASEF
I’ve been a franchisee
for many years and I’ve
seen my share of unfair
practices by SEI. In some
instances, I let things roll off my chest. I’ve come to
realize that some battles aren’t worth fighting. But in
other instances, like the way that SEI is treating their
vendors, I feel that something must be said.
As we all know, the vendor/franchisee relationship is
very important. At the FOAC, we value this partnership
and do everything possible to treat it
with the respect it deserves. We need
the vendors, and the vendors need us.
on the franchisees to attend
It’s a beautiful give and take, and we work together
for the benefit of all parties involved. Unfortunately,
SEI doesn’t seem to see it this way, especially when it
comes to the 7-Eleven Experience. And, franchisees
are paying the consequences.
two shows in the same city,
It’s a known fact that SEI puts pressure on the vendors
to exhibit at the 7-Eleven Experience. Of course,
vendors oblige because they want to maintain a
positive relationship with SEI; even if the cost to
exhibit is beyond their budgets. So, what happens?
I’ll tell you what happens. In order to make up for the
money needed to exhibit at the 7-Eleven Experience,
the vendors are forced to increase the cost of goods.
And, who ends up paying the price? The franchisees!
difficult choices,
in the same year.
SEI shouldn’t put pressure on
them and subject them to such
but it obviously doesn’t
matter to them.
SEI has an obligation, by contract, to provide its
franchisees with the lowest cost of goods from SEI
approved vendors. My friends, I can guarantee that this
is not happening. In fact, Walmart, Target and other
store’s retail prices are LOWER than what 7-Eleven
franchisees are paying as their cost price! Because of
this, it is almost impossible for 7-Eleven franchisees to
compete in the current economic climate. In fact, SEI
is proposing to increase the retail prices even more in
order to offset the recent increase in minimum wage.
Does this make sense? I don’t think so!
And, here’s another problem. This year, there are
going to be two 7-Eleven trade shows in Las Vegas:
the 7-Eleven Experience in February and the National
Coalition’s trade show in July. Do we really need two
trade shows in Las Vegas within months of each other?
Is it fair to ask the vendors to participate in both? It
This story continues on page 2.
The opinions expressed in bylined articles within our newsletter don't reflect, in any way, the opinions or observations of the 7-Eleven FOAC.
Once Again Vendors Are Put on the Spot and Franchisees Suffer: Is This Fair? - continued from page 1.
would have been so much better if SEI and the National Coalition (NCASEF) joined
forces and produced a joint trade show like the FOAC and the NCASEF did in Chicago
last year. Truthfully, the NCASEF convention and trade show in July will feature more
vendors (with better deals and more new items) than what SEI will be offering at
the 7-Eleven experience in February.
Knowing the difficult choices that vendors are being forced to make by SEI, it’s time
for FOA leaders throughout the country to realize that it’s impossible for vendors to
financially support the trade shows and events of all 43 7-Eleven FOAs. I encourage
FOAs in the same areas to consider joining forces and producing their shows
jointly in order to help vendors reduce their expenses. It’s no secret that vendors
are complaining about the financial burden they are subjected to by SEI and by
individual FOAs. We must do what we can to help reduce their financial load.
If SEI was
the lowest cost of goods
for franchisees,
they wouldn’t be
charging the vendors
so much money
to exhibit at their shows or to sponsor SEI events.
Here’s the Reality
By Hashim Syed
Here’s the reality. SEI can’t possibly negotiate the
lowest cost of goods for the franchisees when
they ask the vendors to financially support the SEI
Experience. Wanting to keep SEI happy, vendors
have no choice but to pay SEI what they demand,
and vendors make up for their loss by adding
dollars to the cost of goods sold to franchisees.
What SEI is doing is wrong and unfair. SEI doesn’t
need a trade show to deliver their plans to the
franchisees. They can do so quite effectively by
attending local FOA trade shows in different parts
of the country and communicate their message
on a more personal level.
In my opinion, at least half a dozen trade shows
could be organized by local FOAs in different
regions for less money than what vendors are
forced to pay SEI for participation in one single
trade show. I believe franchisee attendance
would increase because the shows would be more
conveniently located. SEI would be able to reach
and communicate with a lot more franchisees in
their local markets, making it far more rewarding
for vendors, franchisees and SEI.
The individual FOAs can only do so much. It’s time for SEI’s upper
management to make some changes for the benefit of their
franchisees. Receiving the lowest cost of goods is essential for
our success. We cannot remain competitive without it. Will SEI
do the right thing? Will they stop taking advantage of their
vendors and start doing what a good partner should do?
Time will tell. I just hope it won’t be too late.
Truthfully, I find it embarrassing for a company
of SEI’s size and impact (the world’s largest
convenience store) to ask vendors for financial
support in order to host the SEI Experience. To
me, and to many others, it simply looks like a
shake down scheme. SEI should be more mindful
of their approach.
Great Years
By Bob Strauss
‘Twas the night before Christmas and instead of
preparing for my 41st year with 7-Eleven, I’m gathering
thoughts about the completion of a long run; the closing
of the store that I opened in 1975.
Some of my family and friends never really understood
why I looked forward to working each Thanksgiving and
Christmas. Customers who had moved from the area, as
they graduated, began their careers and started their
families, often came home for the holidays. They also
came by my 7-Eleven store just to say “hi”. Even during
the years when I owned four stores, I made sure that I
was on the schedule for the holidays.
The landlord’s unrealistic dreams of a rent increase
caused the unimaginable to happen.
Our very first storefront banner proclaimed ‘The Little
Store That Never Sleeps,’ and aside for an hour or two
for a false bomb threat or a drive through, we made
good on that pledge. The lights stayed on and the doors
stayed open for 40 years.
So many years. So many terrific people, customers,
peers, management, employees and suppliers. I’ve
been living the dream. It’s funny how things work out.
When Advisory Councils were
first formed, franchisees
elected me to those councils.
A year later, I met with a
number of franchisees and
the FOAC was soon formed.
Good fortune with business, strong vendor
partnerships and community relations were only
possible because of being surrounded by so many
good people; lots of talented and caring folks.
My long-term plans didn’t include leaving or
closing my store.
Once Lesley and I made the decision to not be
franchisees, the most amazing thing happened.
Management, at all levels, refused to accept
the claim that I was ‘good’ and ready for life
without a store. Many National Coalition leaders
also found it hard to believe that I was good
with the situation. It took time, but most of
them finally understood that my relationship
to the store’s three generations of customers
and to the community was the adrenaline that
woke me early each morning. Sure, I could have
accepted a free transfer to some mighty nice stores in another
neighborhood, but those stores wouldn’t have had my old
customers.
I experienced the next surprise during the closing of the store.
After countless years of trying to assist upset franchisees, who
called with frantic questions during their changeover audits, I
was prepared for the worst. It turned out that the hardest thing
wasn’t the audit or the final paperwork, it was taking off the
uniform and walking out the door for the final time.
There was still one more surprise waiting for me.
7-Eleven asked if I had heard about the party. Not sure if it
was a cute expression of pleasure that I was soon leaving the
system, so with a straight face, I asked “What party?”
That’s when I got the biggest and best surprise of all. The
company wanted to host a retirement party and said I could
even invite 30, 40 or more franchisees!
Now came the challenge; telling 7-Eleven that I wanted to
include every area FOA President, current or past. These were
the people who I wanted to honor for their commitment to
bettering the system and helping me, too. I also wanted to
invite some customers, many of whom I’ve known for 35 or
40 years. Without a blink of the eye, that’s exactly what the
company agreed to. It was all so much more than I could have
imagined.
As I think of the past 40 years, I couldn’t have asked
for more as a franchisee. And, now I look forward to a
chance to build more unity in the franchise community.
My long run as a store operator has ended, but not my
desire to see franchisees and 7-Eleven do great things.
We’ve got a good one for you! How about committing to
attend the FOAC’s monthly board meetings?
So, what’s your
New Year’s
resolution?
If you would like to be more “in the know,” make more money, learn from your fellow franchisees,
and grow your business, then we encourage you to attend our monthly board meetings. Not only
will you have an opportunity to network with vendors and other franchisees, but you will also gain
valuable information that will help you succeed. Plus, you’ll get a free lunch!
FOAC membership is not required in order for you to join us for the meetings, but you must RSVP to
FOAChicago@gmail.com if you plan to attend.
The Year Ahead
By Joe Galea, Chairman
National Coalition of Associations of 7-Eleven Franchisees
For the majority of our 7-Eleven stores nationwide,
2015 was a successful year sales-wise thanks in part to
the fantastic weather we had and quite a long season.
Nevertheless, we still had numerous challenges to our
business – many of which are carrying over to 2016.
Perhaps our biggest challenge is the minimum
wage increases kicking in this year in states
and cities throughout the country. Many
increases were passed in 2015 and include
minimum wage increases phased in over
several years.
In some cities, the minimum wage will
eventually reach $15 an hour. In Chicago,
it will reach $13 an hour by 2019, with a
50-cent increase this year, after a $1.75 hike last July.
It’s a tough pill to swallow, but this is a popular issue
among politicians, and many legislatures are jumping
on the bandwagon.
The National Coalition and the FOAC are talking with
SEI to find a way to help ease the burden of these
increased payroll expenses. But, to date, in places like
in Seattle where minimum wage has reached $15,
the only help we have received is a crack team of field
consultants to review SRPs and CRPs carefully, store by
store, to make up the difference.
The other game-changing issue we’re concerned about
and working on is the 2019 Agreement.
We’re urging SEI to give franchisees a seat at the table so
we can provide franchisee input when the new contract
is drafted in an effort to get us a fair deal. SEI leadership
has spoken about a “holistic review” of the franchised
system in preparation for the new agreement, but we
have not heard the results of that review.
Franchisee profitability is another major concern we
intend to address this year, and we won’t let up on this
issue until significant progress has been made. There’s
also a possibility that the maintenance cost increase
delayed from 2014 may be passed onto franchisees
sometime this year.
On an operational level, we have a whole host of issues
we are working on with SEI including franchiseefunded promos, RFID chip equipment, McLane tote
charges, hot foods writeoffs, store remodeling, audit
variations, etc. The list is endless.
So we have our work cut out for us. The road ahead is
going to be bumpy, and we are hoping that 7-Eleven
will make an effort to work with us nationally on
systemic issues, as well as locally.
On a lighter note, please make plans to join us at the
National Coalition’s 41st annual convention and trade
FOAC Monthly Board Meetings
The 4th Thursday of Every Month
Thursday, February 25th
Thursday, March 31st
Thursday, April 28th
Thursday, May 26th
Holiday Inn North Shore - 5300 W. Touhy Avenue • Skokie, Illinois
10 am to 4 pm - Lunch will be served
show in Las Vegas July 24-28 at Caesars Palace. We’re
in the planning stages, but I’m very excited with how
it’s shaping up. We have some truly spectacular events
and activities lined up – from high-powered seminars
and a grand trade show to top-notch entertainment
and a special raffle with major prize giveaways. I look
forward to seeing you there!
Come see for yourself what the FOAC is all about and learn what we are doing to support
each other’s goals and objectives. Board meetings are also a forum where you can freely
express any concerns you may have about your stores. We look forward to seeing you!
Please take a moment to add the dates to the left to your calendar, so you can plan
ahead and join us. While your attendance is certainly not mandatory, we have found
that franchisees who actively participate in FOAC meetings gain the information and
contacts they need to help their stores become even more successful.
Make the commitment and make 2016 the best year ever!
TidBits
Order Dippin’ Dots
TODAY!
Do you remember the first time you had Dippin’ Dots? Most do! And, they can give you the
place, date and time of where they first experienced the taste of fun. There aren’t many
products out there that can have such an effect on one’s memories and emotions. We believe
ours does!
For years, Dippin’ Dots has been a staple of fun, pop culture, and an ice cream phenomenon
that was only available at destination locations. Now, 7-Eleven franchisees can capture that
experience and offer their customers our world famous ice cream, right in your store, with our
Dippin’ Dots Impulse program!
Adding Dippin’ Dots is as easy as 1, 2, and 3! Step 1 - fill out the forms, so we can get you set
up in our system. Step 2 – we provide the freezer and set up. Step 3 - we ship the product
direct to your location. Easy!
Dippin’ Dots is a proven impulse item for incremental sales and is the #1 beaded ice cream
brand on the planet. It requires our special low-temperature freezer and cannot go in an
existing freezer set, and at only 26”x28” our impulse freezer takes up a minimum footprint
and maximizes profit in the space.
Interested? Contact Matthew Stark, National Sales Manager at 615-392-8174 or 615-5849477. He can also be reached via email at: matsta@dippindots.com
Do You Know
Any
Military
Vets?
Help
Spread tHe Word!
If you know people who have served in the U.S. Armed Forces, and
they are looking to open a franchise and be their own boss, 7-Eleven
has something in store for them!
SEI is recruiting qualified men and women who have been honorably
discharged to enlist in the company’s second Operation: Take
Command competition. One deserving and lucky veteran will be
awarded a 7-Eleven fee-free franchise, which is a value of up to
$190,000!
The winner can choose any of the company’s 7-Eleven convenience
stores available in the continental U.S. at the contest’s
culmination. Interested veterans can enter online at www.
VeteransFranchiseGiveaway.com now through Feb. 26, 2016, and the
winner will be announced in June.
“More than 6,000 ex-military men and women applied last year, and
1,700 were vetted in our first Operation: Take Command campaign,”
said Greg Franks, 7-Eleven vice president of franchise systems. “The
finalists were outstanding, and many who didn’t win, still took
command of their careers and moved forward through our normal
qualification process to own their own 7-Eleven franchise.”
If you know someone who may be interested, please spread the word
by sharing the website address above.
7-Eleven in California
Sells a Powerball Winner!
As you probably know, one of the winners of the $1.6 billion Powerball jackpots bought his ticket at a 7-Eleven store in Chino Hills, California! The lucky
franchisee, Balbir Atwal, received a check for $1 million for selling it! “I'm very blessed,” the father of three daughters told his daily newspaper, as he gave
free Slurpees to hundreds of customers who came to congratulate him. He said he plans to spread the cash around, “I’m giving some to charity and some to
my employees, my family and my friends,” he said with a smile. “I’ll pay some bills, and then I’ll get ready to sell the next golden ticket!”
Keep
Keep selling
selling those
those lotto
lotto tickets.
tickets. Someday,
Someday, this
this could
could be
be YOU!
YOU!
Give Your
Customers Quality
with Four More Bottles at the Same Great Price
BIGGER
PACK
$ .99
3
*
*Does not include applicable sales tax,
bottle deposit and CRV.
NWNA13758_28
.5-Liter 24-Pack
Nestlé® Pure Life® Purified Water Enhanced with Minerals for
Taste. NESTLÉ and PURE LIFE are registered trademarks of
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©2015 Nestlé Waters North America Inc.
• FOAC Newsletter Editorial Contacts •
Editor: Alisa Bay
847-266-9053 • alisabay@comcast.net
Planner/Art Director: Hashim Syed
847-293-8551 • hj.syed@gmail.com
The FOAC newsletter is designed and printed by Semper Fi Printing & Promotions, LLC located in Arlington Heights, IL
www.foachicago.com • Telephone: 847-353-9999 • Fax Number: 877-387-FOAC (3622) • Email: FOAChicago@gmail.com
Please call the FOAC Hotline at 847-293-8551 with any problems that require immediate assistance.
Empower Them
Problems Continue in Japan
Subject: Franchisee Yoshifumi
Mitsui Explains via Email
To:
Hashim Syed
From: Yoshi Mitsui
I wish you an excellent year 2016. My fellow
franchisees are fine, but two close fellows have
terminated their contracts. The public’s view
regarding 7-11 Japan is getting worse. We are
facing a labor shortage. It is hard to employ
new staff now. 7-11 Japan itself cannot find
new franchisees to open new stores. We are
requesting to the company that they change the
policy of our franchise system. Please continue
to watch our battle in Japan.
Best Regards,
Yoshi
Vice Chairman of the Japan Association of
Convenience Store Franchisee’s Union
There’s no doubt about it. Happy employees are
productive employees. But how do you motivate your
employees to work hard and help your business grow?
Thankfully, it doesn’t take a lot of time or resources to make
it happen. Sometimes, a simple hello or a sincere, “how are
you?” is all it takes to show an employee that you care.
Here are a few tips to help keep your team motivated and
happy to come to work each day.
Communicate Better
The importance of communication is often overlooked.
You should communicate with your employees
frequently, and actually speak with them face-toface. Your staff needs to know they are valued, and
communicating in person with them is the best way to
show your appreciation for their hard work.
Give your employees more of a say in
how they do their job. Ask for their
input and get suggestions on how
they can improve their performance.
Most employees have ideas about
how they can be more efficient,
but they may not share them with
you unless you specifically ask them, so ask!
Offer Opportunities for Advancement
Employees are more motivated when they know they're
working towards something. If they think there's no
opportunity for advancement, then they don't have
much to work for. Nobody wants to work a dead-end job.
Motivate your employees by offering training that gives
them the skills they need to climb their career ladder.
Provide Incentives
Incentives are always motivation boosters, and they
don't have to be expensive. You can offer incentives like
an extra paid day off, gift cards, tickets to the movies, or
other low-cost ways to show your appreciation for a job
well done.
Be a Good Example
You can't expect your employees to work hard or behave
the way you want them to if you don't lead by example.
If you show your excitement about the company's goals,
your employees will get on-board and work to achieve
those goals.
Do you have any tips for motivating your
employees? If so, please share them with us.
Send your tips to FOAChicago@gmail.com, and
we’ll share them in a future issue of the FOAC newsletter.