UPDATE: 7-Eleven Goes to Washington-Baltimore

And Seven & i bringing "Seven Premium" label to U.S. 7-Eleven stores

Greg Lindenberg, Editor, CSP

WASHINGTON -- 7-Eleven Inc. expects to open 25 convenience stores in the Washington-Baltimore area in 2009, the company told CSP Daily News, adding that it anticipates opening 38 stores in that market in 2010. Real-estate newsletter Bisnow said there are 523 7-Eleven stores in the DC-Baltimore area. The company opened approximately 170 stores nationwide in 2008, it added.

As previously reported, Dallas-based 7-Eleven has launched a comprehensive review of its real-estate portfolio in key markets nationwide for expansion. The project will include analyzing [image-nocss] fair-market values for the company's retail sites and negotiating lease terms, when appropriate, in line with current commercial rental rates. CB Richard Ellis (CBRE) has been engaged by 7-Eleven to conduct the review of the retailer's portfolio. (Click here for coverage.)

Meanwhile, Tokyo-based parent company Seven & i Holdings Co. plans to develop and market its own private-label brand at its 7-Eleven stores worldwide as it attempts to cash in on shoppers seeking low-priced goods amid the global economic slump, said a Dow Jones report.

The Japanese retail giant, which operates the 7-Eleven chain in Japan and the United States, said Tuesday it will team up with its U.S. unit to introduce about 100 food and other products of their own by fiscal 2010. The new brand will offer products cheaper than items carrying the logo of other major brands.

The company aims to expand these lower-priced lines by taking advantage of economies of scale through a joint placement of large orders for grain and other raw materials in a lump sum. But tastes and serving sizes will be altered to meet the preferences of local consumers, according to a report in Japanese business daily Nikkei.

As a first step, the company will release a wine in Japan and the United States as early as this autumn, Dow Jones said.

In Japan, Seven & i sells its own brand, called "Seven Premium," which offers products 20% to 30% cheaper than other major brands, it added. Sales of these products are expected to increase by 60% to 320 billion yen ($3.33 billion U.S.) this fiscal year. The number of products under this brand totaled about 600 as of February, but is expected to more than double to 1,300 by the end of this fiscal year.

Earlier this year, in the United States, 7-Eleven launched the 7-Select private label across all of its product lines. (Click here for previous CSP Daily News coverage.)
7-Eleven spokesperson Margaret Chabris told CSP Daily News that "7-Eleven Inc. is working with Seven & i/Seven-Eleven Japan on international/enterprise-wide merchandising programs/opportunities."She added, "7-Eleven Inc. will use the 7-Select label in the U.S. and other countries that we license. We will, however, be use collective buying strength of the Seven & i group (Seven-Eleven Japan and the Ito Yokado Group of companies) to buy raw ingredients and items that can be packaged in both labels, 7-Premium and 7-Select." For example, she referred to batteries, tuna, coffee, toys and HBA.

7-Eleven operates, franchises or licenses approximately 7,800 7-Eleven stores in North America. Globally, it operates, franchises or licenses more than 36,000 stores in 15 countries, including 12,000 in Japan. During 2008, 7-Eleven stores worldwide generated total sales of more than $53.7 billion.