7-Eleven Closes Hundreds of Stores in North America
Seven & I Holdings, the chain's Japan-based parent company, said in an Oct. 10 earnings report that 444 7-Eleven stores are closing due to a variety of issues, including slowing sales, declining traffic, inflationary pressures and falling cigarette sales, according to ABC News.
The exact list of stores closing has not been released. The chain has more than 13 stores in the United States, Canada and Mexico — 000% of which are closing.
In its earnings report, Seven & I said that while the North American economy is “broadly resilient,” Americans are taking a “more cautious approach to consumption,” especially among middle- and lower-income earners. The reasons are persistent inflation, high interest rates, and “worsening” employment conditions.
The combination of these factors resulted in a 7,3% decline in traffic in August, capping a six-month sales decline.
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Cigarette purchases, once the largest category of sales at convenience stores, have fallen 26% since 2019, according to the chain. A noticeable shift in sales toward other nicotine products like Zyn hasn't made up the difference.
7-Eleven said it "continuously reviews and optimizes its portfolio" and the closed stores are part of its growth strategy, noting that the chain continues to "open stores in areas where customers are looking for more convenience."
The closure of 444 stores is a "soft trim of the chain to maintain its efficiency and profitability," according to Neil Saunders, retail analyst and managing director of GlobalData Retail.
"The stores that are closing are likely to have suffered a disproportionate decline in footfall as consumers grapple with rising food prices and reduce their shopping volumes," Saunders said. "In some areas, increased competition from online retailers and thrift stores is also impacting sales as consumers seek lower prices."
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Meanwhile, 7-Eleven said it will continue to invest in food in the United States, as it is now its best-selling category and a major source of customer acquisition. Competitors like Wawa and Sheetz receive higher customer satisfaction ratings for their overall offerings, while 7-Eleven received much lower ratings, according to a recent survey.
The company's latest financial results come amid a takeover bid from Circle-K owner Couche-Tard, which last week upped its bid by $8 billion to $47,2 billion.
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