Avanti Issue 4 2024

2024 ISSUE 4

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Forging A Stronger Brand 7-Eleven Partners, Customers, & Our Communities Benefit

Strengthening Our Partnership For Success Irresistible Force Meets Immovable Object The Impact Of Election Years On Our Stores Building Community One Cup At A Time Gummies On The Go Too Small To Think BIG? Business Insurance 101 Supporting Mental & Behavioral Health

Come get it before it’s gone!

ZERO SUGAR

© 2024 7-Eleven, Inc. 7-ELEVEN, 7REWARDS, SLURPEE, SPEEDWAY, Moving S Design, and SPEEDY REWARDS are trademarks of 7-Eleven, Inc. and Speedway LLC. © 2024 The Coca-Cola Company.

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AVANTI 2024 ISSUE 4

YO U R PA R T N E R F O R G R O W T H

Service First (and second)

Thank you for naming us 2024 Service Provider of the Year for the second year running.

We are honored to be awarded and excited to continue enhancing our trusted relationship with such an exceptional retailer. Our team’s unwavering dedication to service, quality, efficiency, and customer care drives our success. This recognition is a commitment to our partnership with 7-Eleven, and we look forward to future growth together.

Learn more about our commitment to excellence at mclaneco.com.

© 2024 McLane Company, Inc. All rights reserved.

SPARKLING KIWI STRAWBERRY 6-MONTH “7-ELEVEN” EXCLUSIVE! FOD – June 3 SLIN: 245230 Free Fill – First Case Ordered is Free P4 – 2/$4.50

LATEST 12 WEEK PERFORMANCE DATA ENDING 7.14.24

13% $ SHARE AT 7E

15%

UNIT SHARE AT 7E

51 +205

$

SELLS $51 PER STORE DAY OR 21 UNITS PER STORE DAY

*CELSIUS® helps maintain the body’s regular metabolic function. CELSIUS® alone does not produce weight loss in the absence of a healthy diet and moderate exercise. So, whether you walk the dog or work out at the gym, make CELSIUS® part of your daily regimen.

CELSIUS: +205% $ CHANGE V YA. ENERGY CATEGORY: -.05% V YA

EASY TO SUNDAY

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Bud Light® 12-packs make $66 and sell  units per store, per week.

Bud Light® increases average basket size by %, compared to baskets without Bud Light,® with $8.6 of other items usually in the basket too.* Talk to your Anheuser-Busch wholesaler representative to learn more today. *IRI Past 13 weeks ending 4/07/24.

ENJOY RESPONSIBLY © 2024 Anheuser-Busch, Bud Light ® Beer, St. Louis, MO • PHX 6 AVANTI 2024 ISSUE 4

Bud Light® pk Bottles SLIN: 

Bud Light® pk Cans SLIN: 6

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ven tion ! ctac ula r AtCon Ano the r Spe Gatherin g Legislat ive Engagem ent The 48th Annual Soar To New Height s

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ug h Re sil ien ce Th ro es Influencing The Laws & Regulations Affecting Our Stores Tim Ch all en gin g Conti nue

Franchis ees & Vendors

rs Inflation And Other Facto ing To Affect Consumer Spend

A Call To Action Small Change, Big Impact

Thank You! Boosting Foot Traffic Looking To The Future Review. Renew. Relax!

Be Safe, Don’t Chase NCASEF & CMN Hospitals

Change Is The Only Constant Going Back To Basics Ensuring Store Profitability Combating Prop 47 In California Are You Prepared For A Business Interruption?

Getting To Know Worker’s Compensation NCASEF Presented With 2024 Change Maker Award

THE 48TH ANNUAL NCASEF CONVENTION & TRADE SHOW IN PHOTOS!

Coverage Begins on Page 40

Charting A Path Forward Empowering Our Future Through The Ballot Box Sales What We Can Do To Increase In Our 7-Eleven Stores Your Franchise Inc. Four Reasons To Protect Solutions, With National Captive Insurance Thank You, NCASEF!

THE 2024 AFFILIATE MEMBER DIRECTORY Page 57

THE VOICE OF 7-ELEVEN FRANCHISEES

Contents Insurance 101: 13 Business What You Need To Know

By John Wales, AON Program Manager

15 Gummies On The Go

By Nature’s Way

17 Too Small To Think BIG?

By Aaron Choate, Aaron Choate Consulting, LLC

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12 NCASEF Officers Attend Town Hall Meeting

31 Franchisee’s Free Slurpee Event

34 Joe Saraceno FOA Trade Show

38 NCASEF Chairman At BeatBox Conference Strengthening Our Partnership 41 San Diego FOA Hosts A Day At The Races For Success

By Sukhi Sandhu, NCASEF Chairman

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46 San Diego FOA’s Summer Carnival Irresistible Force Meets Immovable Object

By Eric H. Karp, Esq., General Counsel to NCASEF

The Impact Of Election Years 27 On Our Stores

By Teeto Shirajee, NCASEF Vice Chair

Building Community 29 One Cup At A Time

By Ali Haider, Michigan FOA President

33 Supporting Mental & Behavioral Health TS

By Children’s Miracle Network Hospitals

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Member News.....................8 Bits & Pieces.....................38 Legislative Update.....................44 SEI News.....................52 Vendor Focus.....................54 FOA Events.....................58

AVANTI is published by the National Coalition of Associations of 7-Eleven Franchisees for all independent franchisees, store managers and interested parties. National Coalition offices are located at 3645 Mitchell Road, Suite B, Ceres, CA 95307. For membership information, call 855-444-7711 or e-mail nationaloffice@ncasef.com.

The views and opinions expressed in the articles and columns published in AVANTI Magazine are those of the authors and do not necessarily reflect the official policy or position of the National Coalition of Associations of 7-Eleven Franchisees, its officers or its Board of Directors.

2024 ISSUE 4 AVANTI 7

Member News

NATIONAL COALITION OF ASSOCIATIONS OF 7-ELEVEN FRANCHISEES NATIONAL OFFICERS & STAFF Sukhi Sandhu

Seven & i Rejects Couche-Tard’s Bid

Seven & i Holdings recently rejected a $39 billion buyout offer from Alimentation Couche-Tard, the Canadian owner of Circle K stores, citing that the bid undervalued the company’s potential, reported the Wall Street Journal. The offer, which proposed $14.86 per share in cash, was deemed too low and did not sufficiently address concerns about antitrust regulations, particularly in the U.S., where both companies have extensive store networks.

Despite pressure from some foreign shareholders to raise profitability and focus on core operations, Seven & i stated it would resist any proposals that would undermine the company’s intrinsic value or fail to address regulatory hurdles.

Several days after the rejection, Couche-Tard urged Seven & i to enter confidential discussions.

Despite Seven & i’s concerns over undervaluation and potential antitrust issues in the U.S., where the combined entity would dominate

the convenience store market, Couche-Tard expressed confidence in resolving regulatory challenges through potential divestitures.

Couche-Tard said it believes a merger would offer mutual benefits and remains committed to financing the deal, which would mark the largest-ever foreign takeover of a Japanese company.

“Seven & i Holdings recently rejected a buyout offer from Alimentation Couche-Tard.”

Japan Designates Seven & i As ‘Core’ Industry

Japan’s finance ministry recently labeled Seven & i Holdings as a “core” industry, potentially complicating Canadian competitor Alimentation Couche-Tard’s (ACT) takeover plans, reported Yahoo Finance. This classification includes industries like nuclear and cybersecurity, indicating a high level of national security interest. Seven & i had already

EXECUTIVE VICE CHAIR 626-255-8555 • bhullar711@yahoo.com

Teeto Shirajee VICE CHAIR 954-242-8595 • teeto.shirajee@yahoo.com

Michelle Niccoli INTERIM VICE CHAIR 719-661-1048 • nicco711@yahoo.com

Khalid Asad INTERIM VICE CHAIR 913-488-3014 • Khalid.asad@aol.com

Rajneesh Singh TREASURER 214-208-6116 • rjn_singh@yahoo.com

The strength of an independent trade association lies in its ability to promote, protect and advance the best interests of its members, something no single member or advisory group can achieve.

The independent trade association can create a better understanding between its members and those with whom it deals.

National Coalition offices are located in Ceres, California.

OFFICE & VENDOR RELATIONS ADMINISTRATOR 855-444-7711 • shawnh@ncasef.com

Eric H. Karp, Esq. GENERAL COUNSEL 617-512-9004 • ekarp@wfrllp.com John Riggio MEETING/TRADE SHOW COORDINATOR 262-394-5518 • johnr@jrplanners.com

John Santiago MANAGING EDITOR 267-994-4144 • avantimag@ncasef.com

The National Coalition Office

AVANTI 2024 ISSUE 4

Nick Bhullar

Shawn Howard

continued on page 10

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NATIONAL CHAIRMAN 855-444-7711 • sukhi.sandhu@ncasef.com

April J. Key GRAPHIC DESIGNER lirpayek@gmail.com

3645 Mitchell Road Suite B Ceres, CA 95307 855-444-7711 nationaloffice@ncasef.com

The Voice of 7-Eleven Franchisees 2024 ISSUE 4 ©2024 National Coalition of Associations of 7-Eleven Franchisees Avanti Magazine is the registered trademark of The National Coalition of Associations of 7-Eleven Franchisees.

WARNING: This product contains nicotine. Nicotine is an addictive chemical.

To finish on top, start with the top shelf.

The future’s looking up for adult tobacco and nicotine consumers looking for spit-free, smoke-free nicotine satisfaction. ZYN makes 23 of the nation’s top 25 selling nicotine pouches which makes your top shelf the most logical place to find it. ©2024 Swedish Match North America LLC For Trade Only. Not for Distribution to Consumers.

Call 800-367-3677 or contact your Swedish Match Rep to learn more. Statistic source: IRI-Total US Convenience, 26-week IRI Data Pull

2024 ISSUE 4 AVANTI 9

Member News continued from page 8

rejected ACT’s initial buyout offer, which was valued at approximately $40 billion, citing that it “grossly undervalues” the company.

Despite this setback, ACT remains determined to pursue the acquisition, expressing confidence in its financial capacity to close the deal. The “core” industry designation could give Japanese authorities the power to intervene, including the issuance of cease and desist orders to foreign investors. However, Seven & i noted that this rating was not directly linked to ACT’s offer, as the classification update stemmed from a ministry inquiry in June.

FTC Signals Potential Scrutiny Of Seven & i And Couche-Tard Deal

The U.S. Federal Trade Commission (FTC) recently informed Seven & i that it may investigate any potential merger with Alimentation CoucheTard following the Canadian company’s $38.5 billion offer, Reuters reported. The FTC has requested that Seven & i preserve all relevant documents, a move indicating that a merger could face

antitrust scrutiny. Seven & I rejected Couche-Tard’s proposal partly due to these antitrust concerns, with sources suggesting that regulatory issues could be a significant hurdle for the deal.

Couche-Tard has defended its acquisition history, asserting that it has successfully navigated regulatory processes in the past and is open to divestitures if necessary. However, the FTC’s aggressive stance under Chair Lina Khan has led to increased scrutiny of major mergers, including recent high-profile deals such as Kroger’s proposed acquisition of Albertsons and Tapestry’s purchase continued on next page

Aon & 7-Eleven: A Trusted Combo Better informed.

Better advised.

Better protected.

Contact us today for your insurance needs!

Member News continued from previous page

of Capri Holdings.

7-Eleven’s Rising Stars Honored

Convenience Store News recently announced its 2024 class of Future Leaders in Convenience (FLIC), recognizing 50 promising young professionals in the convenience store industry. This year’s honorees— the largest class in the program’s history—represent 32 companies, showcasing the next generation of leaders aged 35 and under who are making significant impacts within their organizations and the industry

at large.

Among the distinguished honorees, several from 7-Eleven Inc. have been recognized for their outstanding work. Arslan Amjad, Senior Category Manager for Fresh Food, along with Sergei Finkler, ATM Lead, and Lauren Freisenhahn, Associate Marketing Manager for Ecommerce, Culture & Social Media, are all noted for their innovative approaches and leadership within the company.

Additionally, Anne Frey, Design Manager at 7-Eleven’s in-house creative team, was acknowledged for her role in enhancing the brand’s visual identity. These individuals

will be celebrated at the Future Leaders in Convenience Summit this November, where their contributions to 7-Eleven and the broader industry will be highlighted.

Couche-Tard Acquires 270 GetGo Stores

Alimentation Couche-Tard recently announced a definitive agreement to acquire GetGo Café + Market stores from Giant Eagle, Inc., adding 270 locations to its North American network. GetGo, known for its foodfocused convenience stores, operates continued on page 36

Reasons we’re proud to serve you:

Optimized our entire service team to continue serving you better.

Introduced location-based policies for seamless service everywhere you go and grow.

Launched our digital wallet to continue serving you better with the latest technology.

It’s simple. It’s reliable. It’s Aon.

Stores wont be cancelled due to losses

We have additional Loss prevention, Employee retention and compliance tools

MARKED 20 YEARS AS YOUR OFFICIAL WORKERS’ COMP INSURANCE AND EPLI BROKER!

Contact us for any insurance questions: (847) 629-4711 support.7eleven@aondigital.com www.aondigital.com/en-us/7eleven

NCASEF Officers Engage With Franchisees At Town Hall Meeting The NCASEF officers recently participated in a Town Hall meeting hosted by four mid-Atlantic FOAs—the Baltimore FOA, the Chesapeake Bay FOA, the Eastern Virginia FOA, and the Suburban Washington FOA. Led by Chairman Sukhi Sandhu

and Executive Vice Chair Nick Bhullar, the session provided local franchisees with valuable insights into the behind-the-scenes workings of the National Coalition. The event attracted over 90 franchisees representing 230 stores.

During the meeting, franchisees raised key concerns surrounding operational challenges, RDC, and Core-Mark deliveries. The open dialogue allowed for direct engagement between franchisees and the NCASEF leadership, making the meeting both highly informative and productive. The event underscored NCASEF’s commitment to addressing franchisee concerns while promoting a stronger connection between local franchisees and the national leadership.

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Business Insurance 101: What You Need to Know

BY JOHN WALES, AON PROGRAM MANAGER

If you have trouble understanding insurance, you’re not alone. That is why, at every event, I’m there in my bright red Aon shirt—to help you make sense of insurance by answering some of your most common questions: What exactly is insurance? What does it cover? How

“Insurance is a contract between you and an insurance company.” much does it cost? From property coverage to workers’ compensation, in this article, we will walk you through the key types of insurance you need to protect your business.

The 5 Most Common Insurance Types

Insurance is a contract between you and an insurance company.

You pay a set amount, called a premium; in return, the insurance helps provide financial protection against unexpected losses up to a predetermined amount. The most common types of insurance are business packages and workers’ compensation.

Business packages are usually a combination of two types of insurance—property and liability coverage—packaged together to help protect your business.

Property coverage is designed to protect your “stuff,” such as a building, your inventory, and deposits. It is

often subject to a deductible, which is the portion of the loss that you pay upfront, and coinsurance, which is a percentage of the overall loss you may be responsible for.

Liability coverage is designed to help protect you financially if you are legally responsible for unintentionally injuring another person or their property. Most policies exclude intentional acts, assault, battery, and any injury to your employees or their property. Additionally, most liability policies do not cover lawsuits from employees. (But there can be a solution for that.)

Workers’ compensation is a type of coverage that helps to protect both you and your employees if an employee is injured on the job.

Even though it is a regulated and complex type of policy, its intent is simple and can help better protect your franchise. As a business owner, workers’ compensation helps protect you by limiting your liability if an employee gets hurt at work. It also provides a level of comfort to your employees by knowing that coverage is in place to help cover expenses if they get hurt at work.

Employment practices liability insurance is designed to handle

“Liability coverage is designed to help protect you financially if you are legally responsible for unintentionally injuring another person or their property.”

“Remember, insurance policies can vary, so it’s always a good idea to review your policy for the specifics.”

claims related to employment issues like discrimination, harassment, or wrongful termination. It helps address gaps in general liability policies and can protect your business against employee-related legal challenges.

Remember, insurance policies can vary, so it’s always a good idea to review your policy for the specifics.

Please stay tuned for my next article, where I will explain how insurance is usually priced and what you can do to help reduce your costs.

If you still have insurance questions after reading this article, just look for the insurance nerd wearing a red AON shirt at your next event! Or call us at, (847) 629-4711. And remember, “Be Safe, Don’t Chase.”

2024 ISSUE 4 AVANTI 13

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Gummies On The Go

BY NATURE’S WAY

In today’s fast-paced, hectic world, convenience often dictates consumer choices. Now, you can meet them where they are and boost your Health & Beauty sales with Nature’s Way Gummies on the Go 10-count packs.

These convenient packs cater to the needs of busy individuals, travelers, and those who are curious about supplements, but not sure where to start.

With the rising demand for products to support immune health, sleep, and relaxation, Nature’s Way Gummies on the Go are a smart and strategic addition to your store shelves, meeting the growing preference for quick, convenient health options.* By offering these targeted supplements, you’ll attract a broader customer base and enhance your store’s reputation as a go-to destination for wellness innovations.

Gummies on the Go launched when Nature’s Way Sales Director Chris Czech noted how convenience shoppers are looking for healthcare wellness options to meet emerging needs.

“Convenience shoppers are looking for items to support immunity, sleep, and relaxation,

especially when on the go or traveling away from home,” he said.* Immune support products have never been more essential than they are today.* Sales for immune supplements in 2022 exceeded $3B1 with elderberry-based immunity products growing at a rate more than two times faster than the total category.2* Nature’s Way Sambucus is the #1 selling brand of elderberry in total market.3 Nature’s Way Sambucus Immune Gummies are flavor-packed gummies made with black elderberry extract, 68% Daily Value zinc, 100% Daily Value vitamin C and 150% Daily Value vitamin D3 per 2-gummy serving.

Convenience consumers in the sleep category are also looking for better, more restful sleep.* Sleep is a $1.4B supplement category, with melatonin as the leading functional sleep ingredient. 4,5* Nature’s Way Sleep Well Gummies are crafted with a unique formula of non-habitforming melatonin, ashwagandha, and magnesium, and are designed to help you fall asleep faster and stay asleep longer.* The Mood & Stress support ctegory

has more than doubled since 2018, with ashwagandha and L-theanine growing at the fastest rates in the Mood & Stress segment in 2022.

6,7 * Nature’s Way Quick Calm Gummies are made with fast-acting amino acid L-theanine to promote relaxation within 30-60 minutes. *

“Nature’s Way Sambucus Immune Gummies are the #1 selling brand of elderberry in total market.”

At Nature’s Way, we believe nature is the ultimate problem solver. For over 50 years, we have looked to the natural world for inspiration. Our quality vitamins and supplements are formulated to help you find your way to wellness and to reach your full potential. *This statement has not been evaluated by the Food & Drug Administration. This product is not intended to diagnose, treat, cure, or prevent any disease.

1 IRI MULO + SPINS, HFS, Amazon Stackline 2018-2022 2 Elderberry Supplements Market Size, Shares by 2033, Future Market Insights 3 Total Sales based on IRI MULO + SPINS Natural Channel & Specialty Retailers Nielsen Whole Foods + Stackline Atlas Amazon, Data, Elderberry Gummies Category L52W ending 8.13.23 4 IRI MULO + SPINS, HFS, Amazon Stackline 2018-2022 5 100+ Sleep Statistics – Facts and Data About Sleep 2023 | Sleep Foundation 6 IRI MULO + SPINS, HFS, Amazon Stackline 2018-2022; *2022 vs 2020, Mintal VMS 2022 vs 2020 7 IRI MULO + SPINS, HFS, Amazon Stackline 2018-2022; *2022 vs 2020, Mintal VMS US 2022 vs 2020

2024 ISSUE 4 AVANTI 15

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Too Small To Think BIG?

BY AARON CHOATE, AARON CHOATE CONSULTING, LLC

After 37 Years of selling products manufactured by long-standing multi-million and multi-billion-dollar companies, I started a sole proprietor consulting firm. I specialize in understanding the needs of large retail chains (like 7-Eleven and others) and large wholesalers who supply them. Working on behalf of clients who are small manufacturers has been an eye-opener.

As I completed a 24-year run in account management with Swedish Match (the makers of ZYN and other national brands) it occurred to me that there are numerous small manufacturers with great products. I’ve seen companies that developed great items and ‘bootstrapped’ their way to a level of success, but are not at a level where they can afford to hire a National Accounts team.

Nor do they have experience dealing with large multi-state wholesalers and retailers. They’ve got great products and packaging for sure, but getting it into stores is a major challenge! I’m not the first one to recognize the need, but this was the thought process that birthed Aaron Choate Consulting, LLC. Facing New Challenges My peers in the National Account Manager and Sales Director roles for large consumer products manufacturers have often talked about challenges they face gaining distribution for new items, delays in getting meetings, and other communications difficulties. Now, through the lenses of small manufacturers’ eyes, I reflect on those as “the good old days.” Working for a company that has decades or a century of history working with large wholesalers had its benefits. Not that every sales call was a slam dunk, but meetings were easier to coordinate.

Introducing New Brands Consider a small manufacturer with a

great product, great packaging and production capabilities that would enable nationwide distribution. Are they big enough to ‘think big’ when it comes to retail distribution? Large manufacturers can leverage program payments, larger brand portfolios and long-standing relationships with large chains and wholesalers. Smaller manufacturers who are new at introducing their products to convenience retail struggle to get attention.

Buyers are busy, planograms are set, and competition is strong.

In late February 2024, I began working to gain traction in c-stores for my first client, Soldier Boy Beef Jerky. Great product, great packaging, strong sales in military accounts, but no significant presence in c-store chains was the issue. In May, I added Pork King Good to the list of clients.

Soldier Boy Beef Jerky Founder Chris Prascus is a veteran of the U.S. Air Force and comes from a long line of men who have served.

Using his grandfather’s recipe for BBQ sauce, he launched this line of Beef Jerky. This veteran-owned manufacturer had items set up in CoreMark and EBY Brown, but not in McLane company, making sales to 7-Eleven stores limited to those supplied by CoreMark. The first shipment to the Nor-Cal franchisees went in mid-August, and we hope to gain access through McLane, too.

Pork King Good Founder Lauren

Kosten developed this brand of intensely flavored Pork Rinds (Chicharones) when she went on a Keto diet and found that there weren’t many great flavor choices. Her homemade product helped her achieve her weight loss goal without sacrificing flavor. Her pork rinds have zero carbs and are selling well in over 4,000 grocery stores. With a growth rate exceeding 180 percent, she launched the brand in Walmart stores in June and is now working to gain c-store distribution.

Numerous McLane-supplied 7-Eleven locations carry the brand so far, and we are working to gain Core-Mark item numbers to satisfy demand in Nor-Cal 7-Eleven stores.

The Chicken or The Egg? To get item numbers in large wholesalers like McLane or Core-Mark, manufacturers are typically asked to get a commitment for distribution from one of the larger chain accounts supplied by that wholesaler. On the flip side, many chains are reluctant to be the first to bring in new items that a wholesaler has not carried. Aaron Choate Consulting was formed in an effort to help great brands from small manufacturers navigate that process. continued on page 25

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Strengthening Our Partnership For Success

BY SUKHI SANDHU, NCASEF CHAIRMAN

Recently, I and the NCASEF officers had a productive meeting with SEI leadership to discuss several pressing issues that have been weighing on franchisees and our system. To my knowledge, this meeting was historic as it marked the first time all NCASEF officers have sat down with SEI’s executive team for a direct and candid conversation about the challenges we are facing. Now more than ever, collaboration and open communication between franchisees and SEI is essential so we can work together on developing long-term, sustainable solutions.

“Now more than ever, collaboration and open communication between franchisees and SEI is essential so we can work together on developing long-term, sustainable solutions.”

Across the retail industry sales and foot traffic have been declining in 2024, and 7-Eleven hasn’t been immune to these trends. As such, franchisees are feeling the pinch. Our store operational costs are rising and our revenues are not keeping pace, creating a financial squeeze that’s impacting our net income.

It’s a situation that calls for urgent action—not only from SEI, but from all franchisees and our supply partners, as well. The truth is we are all part of the same ecosystem, and if one part is under strain, it affects all stakeholders.

One of the significant challenges facing franchisees today is the rising cost of labor. Market-driven wage increases have hit many areas hard—for example

in California, where the minimum wage for fast food restaurants has surged to $20 an hour. This puts franchisees in the difficult position of competing for labor at much higher costs, without a corresponding increase in revenue to offset these expenses. Therefore, we need to explore ways to manage operational costs while also finding new opportunities to drive revenue.

To begin, the “Quality Visits” with area leaders should focus on both business growth and franchisees’ net income. These visits should be centered around meaningful discussions to grow foot traffic and top-line sales, while considering the financial health of franchisees.

In addition, leveraging existing programs is key to driving both revenue and customer loyalty. We need to maximize the potential of 7Rewards, 7NOW, fresh foods, and 7-Select private brand items. These initiatives enhance customer engagement, increase margins, and drive sales. Fresh foods and private brands, in particular, offer substantial margin growth opportunities, which is why they are a priority for our stores.

The 7Rewards program, in particular, is a powerful way to build customer loyalty. When customers see the value in staying loyal to 7-Eleven, they’re more likely to make repeat visits, which increases foot traffic to our stores and creates opportunities for higher sales.

The 7NOW program is necessary because it allows us to compete in the rapidly growing e-commerce and delivery space. As consumer demand for delivery rises, 7NOW positions us to meet this need thanks to the proximity of our stores and our 24/7 operations.

To make 7NOW more profitable, franchisees, SEI, and vendors must work

“Franchisees are also looking for programs and products that can help drive foot traffic without adding to our labor costs.” together. Vendors, who benefit from increased sales through 7NOW, can help by offering us the lowest price of goods.

Further profitability can be achieved by reducing the fixed costs of the 7NOW equipment maintenance fees, supplies, and delivery fees. Through these efforts, the 7NOW program can become a more sustainable and lucrative venture for everyone involved.

Franchisees are also looking for programs and products that can help drive foot traffic without adding to our labor costs. Working with SEI, we could explore options that allow us to attract customers without further straining our already limited resources. One example would be deploying more lottery kiosks to eliminate the labor requirement from that category. Another low labor, revenue generating option is to add skill games to stores in municipalities and states that allow it.

Retail theft has also become a growing concern that is affecting our bottom lines. In certain regions, like California, franchisees find it nearly impossible to prosecute shoplifters and dishonest employees caught stealing due to legal constraints. This “new normal” of increased theft is contributing to higher audit variances and added stress to franchisees’ bottom lines. However, one way franchisees can help alleviate this challenge is by becoming more involved in local and state legislative affairs.

Working with lawmakers to advocate continued on page 21

2024 ISSUE 4 AVANTI 19

Strengthening Our Partnership For Success continued from page 19

for stronger laws that deter criminals can be a key step toward reducing theft and protecting our stores, employees, and customers. We also need support from our franchisor and their Government Relations Department to provide resources and expertise in helping us build stronger relationships with our elected officials.

and industry events like the NACS Show and the Sweets and Snacks Expo. At these events you could potentially find the next big-ticket items—which could be national or regional—that would help drive more foot traffic and sales to your stores. Attending trade shows is also a good way to educate yourselves on industry trends and to explore new

“We need to introduce new, budget-friendly products and categories that resonate with today’s consumers.”

Disposable income among our customer base has decreased, so they’re purchasing less and looking for value wherever they can find it. We need to introduce new, budget-friendly products and categories that resonate with today’s consumers. Exclusive items and better cost structures from our vendor partners can help give us a competitive edge, driving both sales and gross profits.

Since vendors are a critical part of the 7-Eleven ecosystem, we need their continued support in providing products that can appeal to customers while keeping costs manageable for our stores.

But offering great deals alone isn’t enough—we need to ensure that customers know about them. This is where marketing plays a vital role. We need effective marketing strategies to spread the word about our deals, promotions, and value-priced items.

By highlighting these offers through targeted campaigns, we can attract and retain new customers, reinforcing the perception that 7-Eleven is a destination for value. From social media to in-store signage and radio ads, every effort must be made to showcase the savings we offer and build customer loyalty in this competitive landscape.

We should also be on the constant lookout for new, exciting products. I encourage you all to attend your local FOA trade shows, our annual NCASEF convention, the 7-Eleven Experience,

categories and revenue sources.

Due to inflation and the rising cost of goods, our booked inventory is now higher than it used to be, and in most cases, it’s financed. With interest rates also being higher than in recent years, this has become an increased expense we must contend with. Therefore, it is important that we manage our inventory carefully and increase our turnover rate.

We need to eliminate slow-moving and dead items from our shelves, and focus on stocking products that are consistently selling in order to lower our total booked inventory. While this requires action at the store level, we also need the support of SEI’s category managers and merchandisers to help identify and remove underperforming products and introduce new, high-potential items.

Along with managing inventory more efficiently, it is vital to ensure that all revenue-generating equipment in our stores remain fully operational to minimize downtime and prevent disruptions in service.

Regular maintenance and timely repairs are essential to keeping key revenuegenerating equipment—such as Slurpee machines, coffee stations, and hot food equipment—running smoothly.

A significant challenge we face is the unavailability of parts, which delays repairs and negatively impacts both store productivity and the customer experience.

Maintenance service

providers often struggle with parts supply chain issues, causing further delays. To alleviate this, we need to have critical parts readily available so that repairs can be made swiftly, ensuring that equipment is back up and running as quickly as possible.

Additionally, our Retail Initiative System and IT networks must always be efficient, as any downtime directly affects sales and customer satisfaction. If equipment fails, it can result in customers being unable to purchase their favorite products, ultimately hurting revenue.

By prioritizing the maintenance and readiness of all our revenue-generating equipment, we can avoid these costly disruptions and provide a seamless experience for our customers.

To move forward, we need to take a balanced approach where all 7-Eleven stakeholders can prosper together. Coprosperity is the key—if we can grow top-line sales and gross profits, we can reinvest in our stores, offer competitive wages to our employees, and SEI could budget for capital investments like new, revenue-generating equipment, improving the physical plants of stores, and simplifying store processes. All of this would ultimately create a better experience for our customers and grow our net income.

I and the NCASEF officers have been communicating these challenges to SEI, and I appreciate that SEI leadership has been receptive to hearing about the difficulties we’re facing on the ground.

We’re encouraged by SEI’s willingness to work with us on these issues, and we’re hopeful that we can develop actionable solutions that will have a real impact on franchisee profitability and store operations.

SUKHI SANDHU CAN BE REACHED AT 855-444-7711 or sukhi.sandhu@ncasef.com

2024 ISSUE 4 AVANTI 21

R P O F I T S G N I H S A M

SM

SMIRNOFF ICE SMASH HAS GROWN AN AVERAGE OF 19% OVER THE LAST 3 YEARS AT 7-ELEVEN* 0

82000

79896

5

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BLUE RASPBERRY LEMONADE 23.5 OZ. CAN SLIN: 108955

*Source: NIQ 7-Eleven scan Latest 52 wks 2YA w/e 6/4/22-L52 wks w/e 6/1/24

Irresistible Force Meets Immovable Object

BY ERIC H. KARP, ESQ., GENERAL COUNSEL TO NCASEF

When you are aligned with your franchisees, you can rule the world.

Franchisees are our primary customers.

No one has more skin in the game.

The metric that matters most to our owners is restaurant level profitability. Franchisees depend on those profits for their income.

These are the thoughts of Cheryl Bachelder, who served as the CEO of the parent company of Popeye’s Louisiana Kitchen from 2007 to 2015. When she joined the company, guest visits, restaurant sales and profitability had been negative for years and the company’s stock price had dropped from $34 in 2002 to $13. The brand was stagnant and the relationship between the company and its franchisees was difficult and contentious. By 2015, the number of franchisees had grown by 33 percent, franchisor revenue was up 68 percent, franchisor net income was up 83 percent, shareholder equity up by 332 percent, and the price of the company’s

Ms. Bachelder later published a book entitled Dare to Serve and was the subject of a prominent Harvard Business Review article, which can be found at The CEO of Popeyes on Treating Franchisees as the Most Important Customers (br.org/2016/10/theceo-of-popeyes-on-treating-franchisees-asthe-most-important-customers).

The irresistible force mentioned in the title is the understandable and perfectly reasonable goal and desire of every franchisee to maximize the sales, profitability and the value of their investment in their franchised location. The seemingly immovable object is the fact that the franchisor is also under economic stress based on reductions in its own profitability, and the underperformance of the stock of its parent company.

The reason I bring Popeye’s turnaround to your attention is because the 7-Eleven system is experiencing significant challenges which are very reminiscent of the state of the Popeye’s system in 2007.

“By 2015, the number of franchisees had grown by 33 percent, franchisor revenue was up 68 percent, franchisor net income was up 83 percent, shareholder equity up by 332 percent, and the price of the company’s stock rose by 400 percent.” stock rose by 400 percent.

Commenting on these impressive statistics, Ms. Bachelder stated: “The Popeye’s turnaround has become a case study in what happens when leaders think about serving others—in this case, our franchisees. The test of our leadership is simple: are the people entrusted to our care better off?”

Full disclosure: as General Counsel to the Popeye’s Independent Franchisee Association for many years, I was privileged to witness these events firsthand.

I illuminate these challenges to this space not to criticize anyone and for no reason other than to demonstrate the gravity of the current situation.

For example, I cite the following statistics, all of which are taken from publicly available sources, and which I am sure come to no surprise to any franchisee in the system: • Same store sales were down 4.4 percent in July 2024 and 2.7 percent in August, marking the 12th month in a row that same store sales have declined year over

“The irresistible force mentioned in the title is the understandable and perfectly reasonable goal and desire of every franchisee to maximize the sales, profitability and the value of their investment in their franchised location.” year; same store sales had been positive on an annualized basis for each of the years 2014 through 2023; • In 2024 same store sales at 7-Eleven have consistently underperformed those at Circle K and Caseys; • Over the last 3½ years, transaction counts have declined faster than spending per customer; year over year transaction count increases fell from 2.3 percent in 2021 to 5.6 percent in the first half of 2024, while average increase in spending per customer fell from 4.9 percent in 2021 to 1.5 percent in the first half of 2024; • Blended gross margin—for both corporate and franchise stores—was 32.1 percent for the first half of 2024, the lowest recorded first quarter gross profit since that information was first disclosed in 2009; Gross margin as reported by Circle K for the same period was 34.1 percent; • For the three months ended May 31, 2024, operating income for the overseas component (SEI and certain affiliates) of the parent company’s financial statements was only 21.3 percent of the operating income for the same period the year before; • The total return on the company’s publicly held shares have seriously continued on page 25

2024 ISSUE 4 AVANTI 23

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lagged applicable stock indices as well as those of their principal competitors, Circle K and Casey’s; and • Fuel sales and average gallons fell by 11.7 percent and 2.7 percent, respectively in August, compared to declines of 3.7 percent and 4.7 percent, respectively, in July.

This data makes clear that both the franchisor and the franchisee community are under economic pressure and are underperforming their expectations. This is a result of a variety of factors, including those that are internal and external to the system.

These circumstances, as I have

“This data makes clear that both the franchisor and the franchisee community are under economic pressure and are underperforming their expectations.”

repeatedly opined in the past, have made the parent company of 7-Eleven an inviting takeover target. This generated the attempt

by ValueAct, which acquired just under 5 percent of the company in the open market, to spin off the convenience store segment of the parent company of SEI into a separate entity in an attempt to increase shareholder value. This proposal was defeated at a meeting of shareholders.

More recently, the parent company of Circle K has made an unsolicited and non-binding offer to purchase the entire company for an amount roughly equal to its current market value. SEI’s parent company has pushed back, characterizing the offer as opportunistic and not reflective of its intrinsic value, which it expects to realize based on the initiatives underway.

Circle K then responded on September 8, 2024, stating that their proposal has clear and strategic benefits for both companies, including their customers, employees, franchisees and shareholders. The mention of franchisees by Circle K is in stark contrast to the approach of ValueAct, which seemed to be acting as if the franchisees did not exist.

Circle K has not made clear what benefits would accrue to 7-Eleven franchisees if the purchase was consummated. But

“Circle K has not made clear what benefits would accrue to 7-Eleven franchisees if the purchase was consummated.”

expansion. Franchisees’ cooperation in building a small brand is a key factor for success. Red Bull, ZYN and other brands proved their viability as Store Supported Items thanks to franchisees who stocked the brands.

It’s a long road to gain access to retail distribution through large wholesalers to large retailers. Those who make the journey spend a lot on the way with the hope of gaining the kind of growth and profitability those accounts promise. We all face different challenges, but with the friends I’ve made as a Affiliate

Member of the NCASEF, and after years of partnership to drive wholesale and retail profitability, Aaron Choate Consulting, LLC is making progress. Where’s the next big thing to hit 7-Eleven stores going to come from? It just might be a brand from a small manufacturer.

For ordering information, please email AaronChoate@proton.me.

we do know from its publicly available franchise disclosure document, that Circle K franchisees pay a royalty of 3 percent of gross sales and advertising contributions aggregating 1.75 percent of gross sales up to $1.5 million of sales per year. Simple math demonstrates that SEI’s share of the gross profit split alone is substantially higher.

As of this writing there is no way to know or assess the likelihood of a transaction involving the parent company of Circle K. But our concern is that the circumstances that led to the unsolicited offer will not soon dissipate.

ERIC H. KARP CAN BE REACHED AT 617-512-9004 or ekarp@wfrllp.com

Too Small To Think BIG? continued from page 17

First, Best & Only 7-Eleven franchisees typically embrace the “FBO” goal and offer a great opportunity to build the brand story.

Gaining distribution in franchisee stores is a key step toward proving a brand’s viability to 7-Eleven corporate. Recent improvements in the Store Supported Item setup process are making it much easier for franchisees to do the initial setup for products they choose to carry. Items set up send a message to the corporate office indicating interest, and reorders generate the data that supports

AARON CHOATE CAN BE REACHED AT AaronChoate@proton.me

2024 ISSUE 4 AVANTI 25

The Impact Of Election Years On Our Stores

BY TEETO SHIRAJEE, NCASEF VICE CHAIR

Election years can significantly impact various sectors of the economy, including the retail industry and our 7-Eleven stores. The uncertainty surrounding elections often brings shifts in consumer behavior, market conditions, and policy changes, all of which can influence our store operations. Here are some ways election years impact the retail sector, along with some strategies to navigate these challenges.

“The uncertainty surrounding elections often brings shifts in consumer behavior, market conditions, and policy changes, all of which can influence our store operations.”

Consumer Spending Patterns During election seasons, consumers often become more cautious with their spending as they wait to see how potential changes in economic policies and leadership might affect their personal finances. This caution can lead to a dip in sales, especially for non-essential items.

For 7-Eleven stores, this might translate to slower sales in categories like snacks and beverages as customers tighten their budgets.

Political Uncertainty The political climate during election years can be a wild card for retailers like us. Proposed changes in regulations, tax policies, or trade agreements by different candidates can directly affect 7-Eleven stores. We may need to brace ourselves for potential shifts that could impact labor costs, product pricing, or

supply chain dynamics, requiring us to adapt quickly to safeguard our margins.

Market Volatility Election years often come with market volatility that can impact both consumer sentiment and retail performance. Stock market fluctuations and shifts in investor confidence can trickle down to affect our customer base. We need to be prepared for these economic tremors, which can influence spending habits and, ultimately, sales.

Marketing and Advertising Challenges Election campaigns often dominate the media landscape, making it harder for retailers to capture consumer attention.

For 7-Eleven franchisees, this means finding creative ways to break through the noise. Traditional advertising channels may become crowded with political messaging, requiring us to think outside the box to keep our marketing efforts effective and relevant.

Strategies we can follow to navigate election year challenges include: 1. Monitor and Analyze Consumer Trends: We should keep a close eye on consumer behavior during election years. By tracking changes in spending patterns, we can adjust our inventory and marketing strategies to focus on products that continue to resonate with customers despite economic uncertainty.

2. Diversify Product Offerings: To offset potential slowdowns in certain product categories, we can diversify our inventory. Introducing new products or services that cater to a broader range of consumer needs can help maintain steady sales and attract

“Agility is key during uncertain times. We should be ready to modify our strategies to stay competitive.” a wider customer base.

3. Stay Agile and Flexible: Agility is key during uncertain times. We should be ready to modify our strategies, whether it’s adjusting inventory levels, rethinking promotional campaigns, or tweaking pricing strategies to stay competitive.

4. Engage with Customers: Building strong relationships with customers could lead to loyalty, making them more likely to choose 7-Eleven over other options during uncertain periods.

Personalized service, community engagement, and targeted promotions can help us build a loyal customer base that continues to support our stores.

Election years can be a challenging period for 7-Eleven franchisees, but with the right strategies, we can turn uncertainty into opportunity. By staying attuned to market shifts, diversifying product offerings, and maintaining a flexible approach, we can navigate these turbulent times and emerge stronger. Most importantly, by focusing on building solid relationships with customers and the community, 7-Eleven stores can secure their place as a go-to destination regardless of the political climate.

TEETO SHIRAJEE CAN BE REACHED AT 954-242-8595 or teeto.shirajee@yahoo.com

2024 ISSUE 4 AVANTI 27

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Building Community One Cup At A Time

BY ALI HAIDER, MICHIGAN FOA PRESIDENT, BOARD OF DIRECTORS SMALL BUSINESS ASSOCIATION OF MICHIGAN

“Jim, and customers like him, are what make running a 7-Eleven franchise so special.”

When I opened my first 7-Eleven franchise in Perry, Michigan, I was looking to start a business and—just as importantly—become part of a community that felt like home. Perry is a small town, but it’s rich with history and the kind of loyalty you can only find in tight-knit places like this. 7-Eleven has been here for 35 years, and some customers have been coming in daily for just as long.

One of those customers is Jim. He’s a retired handyman, still doing part-time work because that’s just who he is—a hardworking American who embodies the values I admire so much. Every morning for the past 30 years, Jim walks into the 7-Eleven I now own with his well-worn

Stanley thermos, filling it up with his daily dose of 7-Eleven coffee. That thermos, now 23 years old, has seen its fair share of use, and I often tease him, suggesting it’s time for a new one. But Jim is set in his ways. He once tried a new model but found it wasn’t quite the same—different shape, different size.

Jim, and customers like him, are what make running a 7-Eleven franchise so special. It goes beyond serving coffee—it’s about building lasting relationships. I knew I wanted to do something special for him, something that went beyond everyday customer service. So, I measured

–

opportunity to build something from the ground up, to create a business that serves not just products, but also experiences and connections.

7-Eleven, a brand known for its convenience and community presence, allows franchise owners like me to bring that personal touch to everything we do.

I believe in giving back to the country that has given me so much, and I’m proud to be part of a brand that empowers small business owners to make a real difference in their communities. Sometimes that difference is a fresh cup of coffee.

Other times, it’s a surprise gift that says, “You matter.” It’s about going the extra mile because our customers aren’t just customers—they’re friends and neighbors.

“7-Eleven, a brand known for its convenience and community presence, allows franchise owners like me to bring that personal touch to everything we do.” his old thermos and reached out to Stanley to see if they could help. To my surprise and delight, they found one that matched his old faithful exactly. I bought it and surprised him with it one recent morning. The look on his face was priceless. His eyes lit up as he held the thermos—identical to the one he’s cherished for decades.

As a small business owner and proud American immigrant, moments like this remind me why I love what I do. America gave me the

At the heart of it all, I see mself not only as a 7-Eleven franchisee, but also as someone who is living the American Dream, paying it forward, and strengthening the bonds that hold our community together. That’s the power of 7-Eleven, and that’s the beauty of being a small business owner in this great country.

ALI HAIDER CAN BE REACHED AT 517-219-5288 or ali@mi-foa.com

2024 ISSUE 4 AVANTI 29

0

12000 24001

0

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Franchisee’s Free Slurpees Bring Joy On The First Day Of School For the past seven years, Ravi Chahal and his wife, Harpreet, have made the first day of school extra special for children and parents in the Central Coast communities of Orcutt and Arroyo Grande, California by giving away free Slurpees. This year, the tradition continued on August 15th at their store in Orcutt and on August 16th at their Arroyo Grande location. Families eagerly anticipated the event, and the excitement was shared by the local community. The event was also supported by local law enforcement, including the Police, Highway Patrol, Sheriffs and Fire Departments, who always show up to join the fun.

Ravi’s Slurpee giveaway also saw attendance from SEI local management, with Coastal

Desert Region Director Michelle Cram, Market Manager Jeremy Ramey, and Area Leaders David Continente, Rene Rillo, and Cung Pham joining in to support the event.

What makes this event even more meaningful is that it’s a true family affair. Ravi, Harpreet, and their kids all take part in welcoming families and handing out the beloved frozen treats. The gesture has become a hallmark of the Chahal family’s commitment to their community, as both stores are filled with laughter and gratitude each year.

Ravi’s tradition has become a cherished ritual that parents and kids look forward to, making the first day of school that much sweeter.

2024 ISSUE 4 AVANTI 31

Change Kids’ Health.

Change the Future . ®

Born at just 27 weeks, Ella was diagnosed with periventricular leukomalacia (PVL), a softening of brain tissue due to a brain bleed. After spending the first four months of her life in the neonatal intensive care unit (NICU), she was eventually referred to a specialist for children with cerebral palsy at St. Louis Children’s (a local member of Children’s Miracle Network Hospitals®), where she underwent surgery to allow her to walk independently. While recovering Ella was able to enjoy services at the hospital that helped her still feel like a kid, like visits from the therapy dog and time in the playroom.

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CMNHospitals.org

Ella Age 11 32

AVANTI 2024 ISSUE 4

Supporting Mental & Behavioral Health

BY CHILDREN’S MIRACLE NETWORK HOSPITALS

At Children’s Miracle Network Hospitals, we believe that kids need help now. We are unrelenting in our desire to ensure every child has a healthy future, and that includes mental and behavioral health.

mental health service, resource, and/or community benefit. · 90 percent of U.S.-based member hospitals offer clinical services in

“One hundred percent of U.S.based member hospitals offer some mental health service, resource, or community benefit.”

One hundred percent of U.S.-based member hospitals offer some mental health service, resource, or community benefit. These vary from clinical care and telehealth to school-based care and community education. While the pandemic certainly accelerated and magnified an existing crisis, the demand for youth mental health services was happening beforehand—and experts predict the need for services to grow.

Without additional support, member children’s hospitals wouldn’t be able to meet critical needs like mental and behavioral health services for patients and families in their communities. We play a critical role in that process with unrestricted funding. Changing kids’ health means not only providing access to best-in-class health services and treatments, but also addressing some of the social determinants of health that cause and exacerbate the health challenges kids and families face. When you support Children’s Miracle Network Hospitals, you do both—creating a healthier, happier future for families and communities for years to come. · 100 percent of U.S.-based member hospitals, whether standalone or part of a broader health system, offer some

mental health, behavioral health, psychiatry, or psychology. · 90 percent of U.S.-based member hospitals are also integrating mental health services into primary and/or emergency care. · 72 percent of U.S.-based member hospitals offer mental health telehealth services, many of which were implemented in response to the COVID-19 pandemic to continue services to patients and remain in place as a service today.

Member hospitals address the most challenging health issues of today, and prevent and prepare for those to come.

This is only possible because of our

“Member hospitals address the most challenging health issues of today, and prevent and prepare for those to come.”

dedicated partners, like NCASEF. Support Children’s Miracle Network Hospitals Use the following steps to get more involved with Children’s Miracle Network Hospitals and your local member hospital: 1. Contact your local hospital representative. Need help getting connected? Email Kate Burgess (KBurgess@CMNHospitals.Org) with your FOA name.

2. Invite your local hospital representative to present at an upcoming Board or Member meeting.

3. Schedule a hospital tour with your local hospital representative. Please note, this is subject to COVID-19, RSV, and flu-season protocols.

4. Ask your customers to donate during the in-store fundraising campaign.

One hundred percent of funds support the local member hospital.

5. Host a charitable event for Children’s Miracle Network Hospitals. Invite your local hospital and allow them space to showcase the power of your partnership. Local hospitals may be able to support your event through the following: a. Hosting a pre-event presentation: During preevent meetings, local hospital representatives can share information about your local member hospital and the impact your charitable event will have on patients and families. This is a great way to build more familiarity around our partnership before your charitable event. b. Inviting a patient family to the event: Your local hospital representative can invite a patient ambassador to share continued on page 35

2024 ISSUE 4 AVANTI 33

Joe Saraceno FOA Trade Show Shines At Santa Anita Park The Joe Saraceno FOA Trade Show took place on September 5th at the iconic Santa Anita Park, renowned for its rich history in horse racing. This year’s event saw over 85 vibrant booths, each offering great products, exclusive 7-Eleven deals, and exciting giveaways for the raffle drawing. Vendors pulled out all the stops to attract attention, and the competition was fierce, with Monster Beast, Sierra Nevada, and Liquid Death winning the coveted best booth contest.

The show drew an impressive crowd, with over 250 stores represented by franchisees from across Southern California, stretching from Bakersfield to San Diego. The event also saw a strong showing of support from the local SEI area market leaders. NCASEF Executive Vice Chair Nick Bhullar was among the notable attendees, joining the Joe Saraceno FOA Board and members to make the day a huge success. With a buzz of energy and enthusiasm, attendees are already looking forward to the next trade show, scheduled for March 20, 2025.

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AVANTI 2024 ISSUE 4

Supporting Mental & Behavioral Health continued from page 33

their story and the impact of your local member hospital. c. Hosting a CMN Hospitals informational table: Have a table near check-in where participants can learn more about Children’s Miracle Network Hospitals and the impact your local member hospital makes in your community. Your local hospital representative can staff this table and bring informational materials.

“Invite your local hospital representative to present at an upcoming Board or Member meeting.”

d. Welcoming remarks or words of gratitude: Your local hospital representative can share a few brief remarks to thank vendors and franchisees for supporting Children’s Miracle Network Hospitals.

These remarks can be made at any point during the event, but we see great success at the start of your event or during the check presentation.

We are grateful for the many ways FOAs support and interact with their local member hospitals. For additional information or ideas, please contact Kate Burgess (KBurgess@CMNHospitals.Org).

2024 ISSUE 4 AVANTI 35

Member News continued from page 11

across Pennsylvania, Ohio, West Virginia, Maryland, and Indiana, and employs around 3,500 people.

The acquisition, expected to close in 2025, will see Couche-Tard expand its footprint and strengthen its market presence while maintaining a partnership with Giant Eagle on the popular myPerks loyalty program.

Both companies view the transaction as mutually beneficial, with CoucheTard poised to leverage GetGo’s strong customer base and Giant Eagle focusing on its core supermarket and

36

AVANTI 2024 ISSUE 4

pharmacy businesses.

C-Store Categories Face Declines

The first half of 2024 has revealed significant challenges for the convenience store industry, as key product categories experience declines in both dollar sales and unit volume, according to the Convenience Store News 2024 Midyear Report Card. Unlike the previous year, when rising prices helped mask underlying issues, consumers now seem to

have reached their spending limits, resulting in widespread negative trends. Cigarettes, a long-declining category, saw an accelerated drop, with dollar sales falling by 6 percent and unit volume by 9.9 percent. Other tobacco products (OTP) managed a slight increase in dollar sales due to the growing popularity of smokeless tobacco alternatives, but the overall category struggled with a 4.5 percent decrease in unit volume.

Packaged beverages, typically a stable category, saw almost no growth continued on next page

, e g , t r a o s l t

a h

Member News continued from previous page

in dollar sales and a 3.6 percent drop in unit volume, despite continued consumer interest in beverages with functional attributes. Beer and malt beverages also saw declines, with dollar sales down 2 percent and unit volume down 2.6 percent, although some segments like nonalcoholic beer posted modest gains.

Similarly, the candy and salty snacks categories, which had shown mixed performance in 2023, both turned negative in the first half of 2024. Candy saw a 2.1 percent

“Key c-store product categories have experienced declines in both dollar sales and unit volume in the first half of 2024.” decline in dollar sales and an 8.4 percent drop in unit volume, while salty snacks experienced a slight 0.3 percent dip in dollar sales and a significant 6.1 percent decrease in unit volume.

Edible grocery products were hit

even harder, with a 1.9 percent drop in dollar sales and a 7.1 percent decline in unit volume. Nonedible grocery, general merchandise, and health and beauty care (HBC) categories also saw declines, with only a few segments within these categories managing to achieve any growth.

Consumers Push Back Against Inflation

American consumers are playing a pivotal role in the recent cooling of continued on page 39

2024 ISSUE 4 AVANTI 37

Member News

Swipe fees charged by banks and card networks for processing credit and debit card transactions totaled $224 billion in 2023, nearly a third more than previously estimated, according to new data from payments consulting firm CMSPI. • Mars, Incorporated recently announced that it will acquire Kellanova in a deal valued at $35.9 billion, bringing together two iconic businesses with complementary brand portfolios and global reach.

This acquisition will enable Mars to further expand its influence in the snacking industry, uniting Kellanova’s brands like Pringles and Pop-Tarts with Mars’ existing lineup, including

Snickers and M&M’s. • Philip Morris International’s Swedish Match affiliate is investing $232 million to expand its Owensboro, Kentucky facility, creating 450 new jobs and increasing the plant’s workforce by 40 percent.

This expansion, part of PMI’s mission to promote a smoke-free future, is expected to have an annual economic impact of $277 million in the region and support the growing demand for ZYN nicotine pouches among legalage consumers. • Walmart recently introduced invisible barcodes on its Great Value products to combat shoplifting at self-checkouts, reported The Street. Developed with Digimarc,

these barcodes are printed all over the item, allowing for faster scanning without needing to locate a visible barcode. • Casey’s General Stores reported a 6 percent increase in net income, reaching $180 million for the first quarter of fiscal 2024, driven by strong samestore sales and solid fuel margins.

Inside same-store sales rose by 2.3 percent, with total inside gross profit increasing by 10.4 percent, reflecting strong demand in prepared food, beverages, and grocery items.

• Amazon recently introduced “Amazon Saver,” a new no-frills private-label brand designed to continued on page 43

NCASEF Chairman Visits The BeatBox Distributors Conference NCASEF Chairman Sukhi Sandhu, pictured with country music star Dierks Bentley, attended the BeatBox Distributors Conference in Houston, held from August 13-15. The conference highlighted BeatBox Beverages’ continued growth in the market, bringing together distributors and partners to celebrate the brand’s success, including its strong nationwide presence in major retailers like 7-Eleven.

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Member News continued from page 37

inflation, which has gripped the U.S. economy for the past three years, reported the Associated Press. Many large companies, including Amazon and Yum Brands, have noticed a shift in consumer behavior as people increasingly opt for cheaper alternatives or avoid higherpriced items altogether. This change in spending habits is not leading to an economic downturn, but rather

a return to pre-pandemic norms where companies hesitated to raise prices for fear of losing business.

Tom Barkin, president of the Federal Reserve Bank of Richmond, stated that consumers are no longer willing to accept high prices, which is effectively helping to bring inflation down toward the Federal Reserve’s 2 percent target. The Fed’s recent survey shows a decline in both consumer spending expectations and inflation outlook, signaling a broader economic shift.

Cleanliness Key To C-Store Success

During the recent CSP 2024 Outlook Leadership conference, experts from consulting firm Steritech emphasized that cleanliness is crucial for convenience stores looking to boost sales and compete with quick-service restaurants (QSRs), reported CSP Daily News. Bryan Falk, Director of Analytics, revealed that cleanliness is a top consideration for 53 percent of shoppers when choosing a c-store, continued on page 43

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San Diego FOA Hosts A Day At The Races The San Diego FOA hosted its annual Day at the Races event on August 23, 2024, at the historic Del Mar Thoroughbred Club, a venue known for its elegance since 1937. This sold-out event saw 164 franchisees, vendors, friends, and family come together for a fun-filled day at the racetrack, with 41 tables reserved in the shaded Clubhouse Terrace.

Thanks to the generosity of sponsors, attendees enjoyed a lively day of racing, socializing, and refreshments. Special thanks to AnheuserBusch, Coca-Cola, Acrisure (a.k.a. John Barbot Insurance), Monster Energy, BeatBox Beverages, John Lenore, Hatcheri Foods, PepsiCo, Fairlife, Express Ice, Red Bull, and Coast Beverage for their generous support and pariticpation. Frito Lay, McLane, and Sweets 4 Treats kindly provided snacks that filled goodie bags for every table, ensuring that guests had plenty of treats to enjoy throughout the day.

One of the highlights of the day was the second race, proudly sponsored by the San Diego FOA, with Margot’s Boy claiming victory under jockey Abel Cedillo. FOA Board members Waseem Butt and Sukhit Kaur had the honor of visiting the winner’s circle to congratulate the winning horse’s owner, Mark Glatt. The event was a memorable success, and attendees are already looking forward to next year’s day at the races!

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Member News continued from page 39

and a significant portion of customers prefer to spend money at businesses with clean restrooms. Steritech’s studies show that c-stores face more cleanliness issues compared to QSRs, with c-stores averaging 150 percent more cleanliness-related issues.

Falk and his colleague Alex Myrick outlined several best practices from QSRs that c-stores can adopt to enhance cleanliness and boost performance. These include implementing strict cleaning schedules, conducting root cause analyses for persistent issues, and ensuring comprehensive staff training in cleanliness protocols.

Additionally, having a manager or general manager on duty has been shown to significantly improve cleanliness scores. While c-stores have made progress in narrowing the cleanliness gap with QSRs, continued focus on operational excellence in cleanliness, speed of service, and food quality will be critical for c-stores to remain competitive and improve customer satisfaction.

Shifting Trends In Salty Snacks

Convenience stores are witnessing significant shifts in the salty snack category, with inflation playing a crucial role in consumer behavior, reported C-Store Dive. Although salty snack sales increased by nearly 6 percent for the year ending June 16, 2024 compared to the previous year, sales are basically flat for the 26 weeks ended July 14 compared to a year ago, according to Circana data.

Experts note that c-stores face challenges in maintaining growth due to heightened competition for consumers’ dollars amid broader economic pressures—such as price increases for all kinds of goods, mortgage hikes and other higher overall expenses. Despite these challenges, areas such as potato chips and tortilla chips remain robust, with potato chips accounting for 30 percent of salty snack sales in c-stores. Their popularity is attributed to their role in meal bundles and their wide flavor variety.

Additionally, private label snacks

are gaining traction as consumers seek value amid economic concerns.

Private label salty snack sales have surged by 8.3 percent in the past year, outpacing national brands in some subcategories like potato chips and tortilla chips. This growth is driven by the perceived quality of store brands and their ability to offer diverse price options. Flavor innovation also continues to drive sales, with both private and national brands experimenting with niche and exotic flavors to attract consumers.

As economic pressures persist, experts suggest that c-stores focus on optimizing their product assortment and pricing to stay competitive, while also exploring value-driven deals and marketing strategies to appeal to budget-conscious shoppers.

Consumers Embrace Private Label Products

Private label products are rapidly gaining ground in the U.S. market, with a Kearney and NielsenIQ report predicting that private brands continued on page 45

continued from page 38

help customers stretch their grocery budgets further. Most Amazon Saver items are priced under $5, and Prime members receive an additional 10 percent off these products, making it easier to access affordable essentials like crackers, cookies, canned fruit, and condiments both in-store and online. • Molson Coors has partnered

with Naked Life, Australia’s top non-alcoholic RTD cocktail brand, to bring its products to the U.S. market starting in March 2025. The launch will feature five popular RTD cocktail varieties that replicate classic cocktails without the alcohol in order to meet the growing demand for highquality non-alcoholic beverages in the

U.S., a market that has seen nearly 70 percent growth in the non-alc RTD category over the past year. • Sheetz recently announced that it has partnered with AllCampus to offer its 26,000 employees access to over 500 low-cost or tuition-free degree and certificate programs in order to enhance employee retention continued on page 44

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Member News

Legislative Update FDA Strengthens Age Restrictions On Tobacco Sales The U.S. Food and Drug Administration (FDA) recently announced a final rule that tightens restrictions on the sale of tobacco products, aligning with the legislation from December 2019 that raised the federal minimum age for purchasing tobacco products from 18 to 21.

As of September 30, retailers are required to verify the age of any individual under 30 attempting to purchase tobacco products, including e-cigarettes, using photo identification. This new age threshold, an increase from the previous limit of 27, is based on

research indicating the difficulty in accurately assessing a customer’s age by appearance alone, the FDA said. The rule also expands the prohibition of tobacco sales through vending machines to include any facility where individuals under 21 are allowed, tightening the previous restriction that applied only to those under 18.

“AS OF SEPTEMBER 30, RETAILERS ARE REQUIRED TO VERIFY THE AGE OF ANY INDIVIDUAL UNDER 30 ATTEMPTING TO PURCHASE TOBACCO PRODUCTS.”

Enforcement Policy For Cigarette Health Warnings Rule

The FDA recently issued new guidance regarding the “Tobacco Products; Required Warnings for Cigarette Packages and Advertisements” rule, which enhances public awareness of the health risks associated with smoking. Initially issued in March 2020, this rule has faced legal challenges. While the matter is still pending a potential Supreme Court review, the FDA is outlining its enforcement policy, indicating that it will not actively enforce the requirements of the rule for 15 months, setting a compliance continued on page 51

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and attract new talent. • Kroger plans to lower grocery prices by $1 billion after its $25 billion merger with Albertsons is completed, doubling a previous commitment, reported Reuters. The merger, which would create a grocery giant with over 4,000 stores, is currently on hold due to antitrust lawsuits. • The U.S. government has awarded $521 million in grants as part of its $7.5 billion program to boost EV infrastructure,

with $200 million allocated to 10 corridor fast-charging projects and $321 million for 41 community projects, reported CStore Decisions. • Swisher recently announced the rebranding of its smokeless tobacco division from Fat Lip Brands to the historic Helme Tobacco Co., reviving a name with roots dating back to the 1880s. The rebranded portfolio includes 24 smokeless tobacco brands, such as Kayak moist snuff, Starr loose leaf chew, and Navy dry snuff. •

Chick-fil-A recently launched its first elevated drive-thru restaurant in metro Atlanta, featuring four lanes and a new food conveyor system that speeds up service by delivering meals from an elevated kitchen to team members on the ground. • Nearly 3 million people in Britain have successfully quit smoking tobacco products using vapes over the past five years, according to new data from Action on Smoking and Health continued on page 52

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Member News continued from page 43

will capture 24 percent of dollar sales across various categories by 2030, up from 17 percent in 2023, reported Supermarket Perimeter.

The study reveals that 53 percent of consumers now consider private brands as a critical factor in their store choice, a percentage expected to surpass 60 percent by the end of the decade. Moreover, only 2 percent of consumers view private label products as inferior to national brands, while the majority rate them as equal or even superior in quality.

The report also states that food and beverage categories are leading the way in private label growth, with bakery holding the largest share at 56.7 percent of dollar sales, despite a slight decline year-over-year. Other significant categories include dairy, with private labels accounting for 34.6 percent of dollar sales (up 2.5

“A new report predicts private brands will capture 24 percent of dollar sales across various categories by 2030.”

percent) and 37 percent of units (up 3.1 percent), and deli, where private brands represent 27.1 percent of dollar sales (up 2 percent) and 28.5 percent of units (up 2.2 percent).

Meat is also a growing category, with private labels capturing 24 percent of dollar sales (up 3.9 percent) and 24.8 percent of units (up 1.6 percent).

Major Retailers Drive Growth Through Private Label Expansion

Walmart, Target, and Nordstrom successfully boosted their sales by expanding their private label brands, which have become crucial in attracting value-conscious consumers during a challenging economic environment, reported Forbes.

These retailers saw impressive financial results in the first half of 2024, with Walmart’s private brands accounting for up to 25 percent of total sales and Nordstrom’s private labels experiencing mid-single-digit growth, significantly contributing to their profitability and competitive edge.

Private labels have proven advantageous for retailers by offering higher profit margins and exclusive products that differentiate them from competitors, the article states. Target, with nearly 50 private label brands, reported a 40 percent earnings increase in Q2 2024, while Costco’s Kirkland Signature brand generated $56 billion in revenue.

Meanwhile, retailers like Dollar General struggled, despite a focus on value, due to increased competition from stores offering better shopping experiences and comparable prices.

Couche-Tard Reports Mixed First Quarter Results

Alimentation Couche-Tard announced net earnings of $790.8 million for the first quarter of fiscal

2025, slightly down from $834.1 million in the same quarter last year.

The company’s adjusted net earnings also saw a small decline, with diluted net earnings per share decreasing by 3.5 percent to $0.83. Despite this dip in profits, merchandise and service revenues increased by 5.1 percent to $4.5 billion, although samestore merchandise revenues fell in the U.S., Europe, and Canada due to economic pressures on low-income consumers. Gross margins in merchandise and services varied by region, with a slight decrease in the U.S. and Europe but an increase in Canada.

Fuel demand remained weak globally, with same-store road transportation fuel volumes declining in all regions, including a 0.8 percent drop in the U.S. and a 2.1 percent decline in Canada. While fuel gross margins remained healthy overall, there were modest declines in some areas, such as a decrease of 1.92 cents per gallon in the U.S. and 0.14 cents per liter in Canada. Following the end of the quarter, Couche-Tard entered into an agreement to acquire approximately 270 convenience retail and fuel sites in the U.S., signaling continued expansion despite the challenging economic environment.

Texas Emerges Epicenter Of U.S. C-Stores

Texas has emerged as the leading state for convenience stores in the U.S., boasting over 16,300 locations, which is 4,000 more than the secondcontinued on page 47

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The San Diego FOA’s Family-Friendly Summer Carnival & Mini Trade Show On August 1, the San Diego FOA delighted franchisees, vendors, and their families with its Summer Carnival and Mini Trade Show, held at the Four Points by Sheraton in San Diego. The event offered something for everyone, from great vendor deals to exciting carnival games and prizes, creating a welcoming atmosphere where children were invited to join the fun. With lunch provided

by The Habit Burger Grill, families enjoyed an afternoon of entertainment at the Pavilion and Patio area, complete with a lively Carnival Playland. The raffle prizes added to the excitement, making the business-oriented event a memorable experience for all attendees.

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The trade show featured a wide array of vendors such as Coca-Cola, Monster Energy, Heineken USA, and Hershey. In addition to the business side of the event, community organizations including Rady’s Children’s Hospital Foundation, the San Diego County Sheriff’s Office, and the City of San Diego Fire Rescue Department were on hand to support the festivities. Vendors like Geloso Beverages, Celsius, and Swisher offered exclusive deals, while local businesses such as San Diego Cash & Carry and CIB Security Inc. were also present. The mix of professional networking and family entertainment made the Summer Carnival a standout success.

Member News continued from page 45

ranking state, California, reported C-Store Dive. This growth is driven by the state’s rapid population increase and favorable building conditions, attracting both large and small retailers like 7-Eleven, Casey’s General Stores, and FEMSA, who are expanding their presence significantly in 2024.

Experts attribute Texas’ dominance to its lenient zoning regulations, particularly in areas like Houston, and its car-dependent culture, which encourages frequent visits to

“Texas has emerged as the leading state for convenience stores in the U.S., with over 16,300 locations.” convenience stores. The state’s appeal is further amplified by its status as the fastest-growing state in terms of population, which in turn fuels the demand for more convenience store locations.

Massachusetts Court Rules 7-Eleven Franchisees Are Not Employees

The Massachusetts Supreme Judicial Court recently ruled that 7-Eleven franchisees are not employees under the state’s wage law, reported Reuters. The court unanimously found that franchisees do not “perform any service” for

the company, instead operating their independent businesses under the 7-Eleven brand. Justice Dalila Wendlandt wrote that the franchisees chose to operate using the 7-Eleven business format and agreed to the conditions that maintain the brand’s integrity. The ruling addressed a 2017 proposed class action by franchisees who claimed they were owed minimum wage and other legal protections.

The case, Patel v. 7-Eleven Inc, has been ongoing since 2017, with U.S. District Judge Nathaniel Gorton initially dismissing the lawsuit in 2020. The plaintiffs had argued that they were essentially glorified store managers due to the control 7-Eleven exerted over their operations, such as the requirement to remain open 24 hours a day and carry specific products. Despite being revived briefly in 2022, the Massachusetts Supreme Judicial Court ultimately agreed that the state worker classification law protects workers from being misclassified as independent contractors, not to turn independent business owners into employees.

Stores Curb Shoplifting Surge

After declaring a shoplifting epidemic last year, retailers like Target are now reporting significant progress in reducing merchandise losses, reported CNN Business.

Target, which had previously blamed shoplifting and organized retail crime for over $500 million

in profit losses, recently stated it is “ahead of where we expected to be in terms of progress on shrink.”

Many retailers have adjusted their metrics and improved inventory accuracy, leading to a stabilization or improvement in merchandise losses. Efforts to curb theft include locking up products, removing selfcheckout stations, and collaborating with local and state governments to strengthen anti-theft measures.

This more accurate accounting and enhanced security have contributed to a reduction in reported shrink rates, with mentions of “shrink” on earnings calls dropping 20 percent during the first half of 2024 compared to the previous year.

Although shrink rates improved, theft remains a concern, especially with a reported 24 percent increase in shoplifting in major cities during the first half of 2024 compared to the same period in 2023. Retailers continue to implement preventive measures like locking product displays, but these strategies have frustrated shoppers, leading some to take their business elsewhere. The retail industry continues to work with law enforcement and invest in security to address theft, while analysts suggest that retailers’ prior exaggeration of the problem may have obscured other operational issues.

Dollar General’s Financials Hit By Inflation

Dollar General experienced a secontinued on page 49

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SUBs are up +32%, the fastest growing pack type!1 Over $28MM in annual sales!​2

SLIN 142847 CM 491599 UIN 328147

SLIN 142422 CM 491602 UIN 324027

SLIN 142440 CM 491601 UIN 331257

SLIN TBD CM 496615 UIN 394297

SLIN TBD CM TBD UIN 776917

Hanging bags have over $32MM in annual sales!3

SLIN 144991 CM 491403 UIN 323987

SLIN 141523 CM 490991 UIN 323967

SLIN 140442 CM 491595 UIN 323977

SLIN TBD CM 522237 UIN 693177

SLIN 145690 CM 491596 UIN 446887

SLIN 142436 CM 491404 UIN 323887

SLIN TBD CM 494568 UIN 394337

Source: 1-Circana, Total U.S. MULOc/Conv/Drug/Grocery and National Mass Retailer RMA, Non-Seasonal, Standup Bags Less than 12oz, Latest 52 Weeks Ending 04-21-24​. 2-Circana, Total U.S. MULOc and Mass Retailer RMA, Non-Chocolate, Non-Seasonal, Standup Bags 5-13oz, Latest 52 Weeks Ending 04-21-24​. 3-Circana, Total US MULOc, Non-Seasonal, Latest 52 Weeks Ending 04-21-24​.

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Member News continued from page 47

vere setback as inflation continues to weigh heavily on its customers, leading the retailer to slash its earnings projections for the remainder of 2024 reported CSP Daily News. In the second quarter, the company saw its operating profit drop by 20.6 percent to $555 million, while same-store sales inched up by just 0.5 percent.

CEO Todd Vasos said the downturn began in late July, with the weakest sales occurring at the end of each month, indicating that customers are struggling to stretch their budgets.

Surveys show that more than 60 percent of Dollar General’s core customers have had to cut back on basic necessities, with many expressing heightened financial insecurity.

To counter these challenges, Dollar General has ramped up promotional activities, which has put additional pressure on both sales and gross margins, a trend expected to continue throughout 2024. The company’s gross profit margin fell by 112 basis points in the second quarter, driven by increased markdowns, higher inventory damages, and a shift in sales towards lower-margin consumables.

Net income also suffered, dropping 20.2 percent to $374.2 million yearover-year.

As a result, Dollar General has revised its full-year projections, lowering its net sales growth estimate from 6.0-6.7 percent to 4.7-5.3 percent, and its same-store sales growth forecast from 2.0-2.7 percent to 1.0-1.6 percent. Despite these setbacks, the company remains committed to its “Back to Basics” strategy, focusing

on supply chain, merchandising, and labor, with the belief that loyal customers will return when economic conditions improve.

Target’s Grocery Transformation

Target has transformed its food and beverage business, increasing sales by over $8 billion since 2019 to a total of $24 billion, reported Grocery Dive. The company noted that more than 55 percent of shopper baskets include food and beverage items. Digital grocery sales have also soared, with online sales growing more than tenfold since 2019. In fiscal Q1, Target’s digital comparable sales saw a 1.4 percent increase compared to the previous year, fueled by nearly 9 percent growth in same-day services.

The retailer has also significantly cut prices on around 5,000 items, focusing on essential grocery and household products under its national and private labels.

Stop & Shop Ends Tobacco Sales

Stop & Shop recently stopped selling cigarettes and all tobacco products in its 360 stores. The company—with stores across Massachusetts, Rhode Island, Connecticut, New York, and New Jersey—said it made this decision as part of its commitment to promoting community wellness. Gordon Reid, Stop & Shop’s President, said the move aligned with their broader initiatives, which included providing custom-

ers access to registered dietitians and trusted pharmacy associates for free health services. To encourage customers to quit smoking, Stop & Shop hosted two cigarette buyback events on August 28 at stores in Boston and Staten Island, offering gift cards, healthy snacks, and smoking cessation materials in exchange for unopened cigarettes.

Youth E-Cigarette Use Declines

A new report from the National Youth Tobacco Survey (NYTS) reveals a significant drop in youth e-cigarette use, with 500,000 fewer U.S. students reporting use in 2024 compared to the previous year, according to the U.S. Food and Drug Administration (FDA) and Centers for Disease Control and Prevention (CDC). The survey, conducted between January and May 2024, showed e-cigarette use among U.S. middle and high school students fell from 2.13 million in 2023 to 1.63 million in 2024, marking the lowest level in a decade.

The decline was driven by reduced use among high school students, while middle school use remained steady. In 2024, e-cigarette use was only about one-third of its peak in 2019, when over five million students reported usage. Despite this progress, health officials caution that continued efforts are needed to combat youth vaping, as a significant portion of users still engage in daily e-cigarette use and prefer flavored products like fruit and candy.

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Member News continued from page 44

Legislative Update deadline of December 12, 2025.

Additionally, the FDA will allow an extra 30-day grace period for products manufactured before this date, extending the compliance window to January 12, 2026.

The final rule also mandates that the industry submit and gain FDA approval for plans ensuring the random and equal display of health warnings on cigarette packages and the quarterly rotation of these warnings in advertisements. The FDA is recommending that entities without approved plans submit them

by February 10, 2025, to facilitate compliance.

This 15-month transition period aligns with the timeline originally proposed by the Family Smoking Prevention and Tobacco Control Act, which was disrupted due to litigation.

Governor Josh Shapiro as part of the 2024-25 budget, which authorizes the sale of spirits-based RTDCs with alcohol content ranging from 0.5 percent to 12.5 percent in original containers up to 16 ounces for off-premises consumption.

Previously, only state-run liquor stores in Pennsylvania could sell these products, but now retailers holding the new RTDC permits will also be able to participate, provided they are certified in the Responsible Alcohol Management Program.

Pennsylvania Retailers To Sell RTD Cocktails

California Tightens Grip On Organized Retail Crime

The Pennsylvania Liquor Control Board (PLCB) recently opened applications for ready-to-drink cocktail (RTDC) permits, allowing grocery stores, convenience stores, and other retailers to sell canned cocktails as of September 16, reported Convenience Store News.

This new opportunity arose from Act 86 of 2024, signed into law by

“THE ILLINOIS STATE LEGISLATURE RECENTLY PASSED A BILL THAT ELIMINATES SWIPE FEES ON SALES TAXES, STATE EXCISE TAXES, AND GRATUITIES.”

California Governor Gavin Newsom recently signed a comprehensive package of 10 new laws aimed at combating the rise of organized retail crime in the state, a move that retailers have been advocating for amid growing concerns about the impact of theft on their operations, reported CNBC. The new laws target

various aspects of retail crime, including shoplifting, vehicle theft, and the resale of stolen goods on online platforms. One of the most significant bills in the package, SB 1416, imposes tougher penalties on those who facilitate organized retail crime, particularly middlemen who profit from the resale of stolen goods.

The impact of organized retail crime has been felt by retailers who report decreased profits, challenges in staff retention, and a diminished in-store experience for customers.

The California Highway Patrol’s Organized Retail Crime Task Force has already made significant progress this year, with hundreds of arrests and millions of dollars’ worth of stolen goods recovered.

However, the retail sector continues to push for stronger national legislation, with the National Retail Federation advocating for federal felony charges for organized retail theft.

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Member News

Seven-Eleven Japan Focuses On Affordability

Seven-Eleven Japan is refocusing its efforts on providing more affordable options to its customers, responding to concerns that convenience store meals have become more expensive than dining at casual restaurants, reported Japan Today. The company said it will expand its budget-friendly “Ureshii Ne” (“Happy Price”) food line, which offers lower-priced meals without compromising on portion sizes. This decision follows the success of its July price cuts on popular items like salmon and tuna mayonnaise onigiri, which increased sales by 10 percent. The chain plans to increase the number of items in the Ureshii Ne line from 20 to 65, with significant price drops on popular

meals like fried rice plates and butter chicken curry. Seven-Eleven Japan attributes these price reductions to improvements in its supply chain and manufacturing processes, ensuring that affordability doesn’t come at the expense of portion sizes or quality.

Seven & i To Use Renewable Energy

Seven & i Holdings is entering the electricity retail market with plans to provide renewable energy to its group stores starting in April 2025, reported Nikkei Asia. The company has established a new subsidiary with a capital of 400 million yen to manage this venture, which will source renewable power directly from producers and distribute it through a separate entity. This move is part

of Seven & i’s broader strategy to align with Japan’s national goals of reducing greenhouse gas emissions by 46 percent by 2030 and achieving netzero emissions by 2050. The company itself aims to cut its carbon dioxide emissions in half by 2030 compared to 2013 levels.

Currently, renewable energy constitutes just 10 percent of Seven & i’s domestic electricity consumption, but the company plans to increase this to 40-45 percent by fiscal 2030 through its new subsidiary.

By sourcing energy directly from producers and signing long-term contracts, Seven & i seeks to protect itself from market price fluctuations and potentially lower its electricity costs. The company already powers about 400 stores with solar energy from exclusive partnerships with NTT

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(ASH). Overall, 5.6 million British adults currently vape, with 53 percent having stopped smoking tobacco, 39 percent still smoking, and 8 percent never having smoked. • Rutter’s has launched ondemand delivery exclusively for its loyalty members, allowing them to order food, snacks, and more through the retailer’s mobile app in partnership with Uber, reported C-Store Dive.

• Americans consumed over 100 trillion megabytes of wireless data in 2023, marking a 36 percent increase from the previous year driven by the 52

AVANTI 2024 ISSUE 4

growing use of 5G devices, according to a survey by wireless industry association CTIA. Despite the surge in data use, the total number of phone minutes and text messages remained relatively stable, while the wireless industry continues to face challenges in accessing new spectrum for further growth. • Amazon is expanding its Just Walk Out technology to 10 additional U.S. college campuses, increasing the total number of campus stores using the checkout-free system to over 30 worldwide. In addition to

campuses, Amazon is also introducing the technology to NFL stadiums, with improvements like RFID-enabled stores at Lumen Field, offering a faster and more diverse shopping experience. • Casey’s General Stores shareholders recently voted against a proposal during their August 28 meeting that would have required the board chairperson to come from outside the company, allowing Darren Rebelez to remain as both chairman and CEO, reported C-Store Dive.

Member News continued from previous page

Anode Energy and Hokuriku Electric Power, and it plans to maintain these collaborations while expanding its renewable energy portfolio.

SEI Expands Sustainable Fresh Produce Offerings

SEI recently announced a partnership with Plenty Unlimited Inc. to enhance its commitment to sustainability by offering fresh, locally grown produce in its California stores. This collaboration allows 7-Eleven to provide customers with high-quality, pesticide-free leafy greens that are sustainably grown using Plenty’s cutting-edge vertical farming technology. Starting with 1,300 stores across California, SEI will incorporate Plenty’s sustainably grown lettuce into two classic salad options: the California Cobb Salad and the Chicken Caesar Salad.

With Plenty’s methods, these greens are produced using just 1 percent of the land and 10 percent of the water typically required by traditional farming, while yielding up to 350 times more produce per acre, the company said. This aligns with SEI’s Good Made Easy initiative, which focuses on offering products that meet customer expectations for quality while also contributing positively to environmental sustainability.

Introducing Coca-Cola OREO Zero Sugar Slurpee

SEI recently unveiled a new limited-time Slurpee flavor, Coca-

Cola OREO Zero Sugar, available at participating 7-Eleven, Speedway, and Stripes stores across the U.S. This flavor combination fuses the familiar, fizzy taste of Coca-Cola with the sweet, cookie-inspired hints of OREO, offering customers a unique twist on the classic Coca-Cola Slurpee. The release of this drink also coincides with CocaCola and OREO’s upcoming launch of two special snacks: Coca-Cola OREO Zero Sugar and the OREO Coca-Cola Sandwich Cookie, also available at participating 7-Eleven, Speedway, and Stripes stores.

To celebrate the launch, SEI hosted a special tasting event in Dallas on September 14 at their Preston Road location, called “The Besties Restie Stop.” This event gave customers the chance to try the new Coca-Cola OREO Zero Sugar Slurpee while enjoying quality time with friends. The event also featured exclusive, limitededition Slurpee collectibles, such as cups with a unique Slurpee dollop lid and “bestie” straws.

“New Coca-Cola OREO Zero Sugar Slurpee fuses the familiar, fizzy taste of Coca-Cola with the sweet, cookie-inspired hints of OREO.”

Exclusive Punk Bunny Coffee Blend

To celebrate the 60th anniversary of 7-Eleven’s to-go coffee and the 30th anniversary of Green Day’s breakout album, SEI has partnered with the band’s coffee brand, Punk Bunny Coffee, to launch an exclusive Anniversary Blend available at 7-Eleven, Speedway, and Stripes stores nationwide. In addition to the Anniversary Blend, 7-Eleven is also offering Punk Bunny’s Fair Trade Certified coffee in bagged blends and K-Cups, including the Sound Check and Last Ride In roasts. To mark this milestone, SEI provided fans with a unique opportunity: the first 50 people to get a custom 7-Eleven x Punk Bunny tattoo at the 800 6th Ave location in New York City received free coffee for 711 days.

The partnership extended beyond coffee, as 7-Eleven and Punk Bunny also launched a limited-edition merch capsule through the 7Collection online store, featuring co-branded tees, totes, and stickers.

2024 ISSUE 4 AVANTI 53

Hostess Delights C-Store Shoppers With New Innovations

Hostess has rolled out three exciting new offerings for convenience store customers, designed to tap into popular flavor trends and consumer habits. First up is the Chocolate Lovers Twinkie, a fresh twist on the iconic snack cake. With chocolate ranking as a top dessert flavor among 71 percent of consumers, this product is expected to resonate, particularly with Millennial Parents who feel the chocolate flavor aligns with the Hostess brand. Already boasting a 89 percent brand awareness, Twinkies continue to stand strong in pop culture. The Chocolate Lovers Twinkie (SLIN: 174934) is available in stores now.

Next, Hostess brings indulgence to the microwave with Meltamors Double Chocolate & Caramel.

Inspired by warm restaurant-style desserts, these treats feature a moist, flavorful cake with a thick “lava” filling that transforms after a few seconds in the microwave.

Complete with a delicious drizzle and free from artificial flavors, colors, or high-fructose corn syrup, Meltamors are made for on-the-go snacking. In fact, 71 percent of male convenience store customers say they would enjoy Meltamors on the move. Both Meltamors Double Chocolate (SLIN: 174800) and Meltamors Caramel (SLIN: 174890) are now available.

Rounding out the lineup is the Donette Fritter Ring, launching November 16, 2024. This modern twist on a traditional donut offers a fun bubble shape that’s easy to pull apart and share. Made with real apples, the apple cinnamon flavor is expected to be a hit, especially with 79 percent of male convenience store shoppers who say it’s a fun snack. Moreover, 40 percent of this group mention they would purchase the Donette Fritter Ring in addition to their usual buys. Keep an eye out for this tasty snack later this fall!

Treat your customers to Hostess’ latest innovations.

54

AVANTI 2024 ISSUE 4

Big Chewy CHIPS AHOY! Is Your Ticket To Big Sales

New, soft-baked CHIPS AHOY! Big Chewy Original and Chocolatey Brownie are more than three times the size of original CHIPS AHOY! for three times the fun! Bigger, soft-baked, and delicious, these cookies are the newest, biggest addition to the family.

And they’re ready to be the newest, biggest addition to your bottom line!

Not only are these cookies big and big on flavor, they’re big with your consumers, too. With 30 percent household penetration, CHIPS AHOY! is the #1 chocolate chip cookie. Plus, it’s a top brand with Gen Z with a 155 index with ages 13 to 17 and a 170 index with ages 18 to 24.

According to Mondelez’s surveys, 80 percent of respondents say it’s “new and different” and 70 percent view it as “more fun to eat” vs. other c-store offerings.

Plus, with 72 percent of consumers saying it’s good for on-the-go snacking, it’s just about the perfect snack for everything from quick pick-me-ups to road trips.

So, put something BIG on Boost your bottom line by your bottom line. Stock up on stocking up on Big Chewy new, Big Chewy CHIPS AHOY! CHIPS AHOY! Original and Original and Chocolatey Chocolatey Brownie.

Brownie! This. Is. Big.

New, Puffy Pringles Mingles Are In The Bag

Pringles are already out-of-this-world delicious, but now they’re coming out of the can and into a bag for a whole new way to enjoy the iconic crisps. Pringles Mingles is a first-ever puffed offering that delivers an irresistibly delicious and shareable snacking experience to enjoy with friends and family, whether munching at home, at a party, or on the go.

Pringles Mingles is the debut of the first bagged Pringles snack in 15+ years. This new creation is crispy on the outside with a light and airy texture on the inside for a melt-in-your-mouth tasting experience. Each bite-size puff mingles two mouthwatering Pringles flavors and boasts a bowtie-style shape inspired by Mr. P’s signature look. continued on next page

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• Pringles Mingles Cheddar & Sour Cream offers hints of buttery cheddar cheese flavor seamlessly blended with creamy, tangy sour cream notes to create a savory and Pringles Mingles are available in zesty flavor combination Cheddar & Sour Cream and White that will leave fans craving Cheddar & Ranch flavors. more.

• Pringles Mingles Sharp White Cheddar & Ranch is the meeting of sharp, aged white cheddar cheese flavor and zippy buttermilk and herb ranch notes, creating the perfect balance of cheesiness and tanginess in every munchable bite.

Both options available as First-to-Market in P6 10/30/24-12/2/24. First order date 9/30/24.

position of the number one premium natural leaf cigarillo in growth in 2023. (Source: MSA 2023) Notably, Al Capone Wraps have asserted their dominance, with all three SKUs among the top eight in their category and clinching the coveted title of the number one natural leaf wrap in the United States. This stellar performance reflects not only the superior quality of Al Capone products but also the brand’s unwavering commitment to providing adult consumers with an unmatched smoking experience. 7-Eleven retailers now have the chance to leverage Al Capone’s success by tapping into a lucrative offer that promises to elevate both their shelves and profits. Join the ranks of those capitalizing on the momentum of the industry’s rising star and enhance your tobacco portfolio with the premium allure of Al Capone Cigarillos and Wraps.

Elevate Your Profits With Al Capone

In the dynamic world of tobacco retail, maximizing profitability is a constant pursuit, and Al Capone Cigarillos presents an unparalleled opportunity to elevate your sales and delight customers. As the second-largest global brand of cigarillos, Al Capone Cigarillos boasts a reputation for excellence and sophistication. The brand’s remarkable ascent is evident, with Al Capone securing the

Increase your tobacco sales with Al Capone Cigarillos and Wraps.

AD INDEX Al Capone..................................37

Danone.......................................40

McLane.........................................4

American Licorice....................48

Diageo.........................................22

Mondelez....................................42

Anheuser-Busch.........................6

Dreyers Ice Cream....................12

Monster Energy.........................60

AON.....................................10, 11

Glanbia.......................................24

Nature’s Way..............................14

Bel Brands..................................18

Heineken.............................36, 39

Perfetti..........................................3

Bic Consumer Products ..........16

Hostess........................................59

PepsiCo - Beverage....................30

Campbell Soup..........................35

Kellanova....................................50

Swedish Match............................9

Celsius .........................................5

Kretek.........................................26

Swisher........................................28

Coca-Cola....................................2

Kureig Dr Pepper.......................20

Tweaker Energy.........................56 2024 ISSUE 4 AVANTI 55

J G

B P M P

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INCREASE YOUR SALES BY ADDING A VALUE SHOT IN YOUR CATEGORY

F F C ( S U O

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O N W A P

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FOA EVENTS Joe Saraceno FOA Golf Tournament Brookside Golf Club Pasadena, California March 19, 2025 Phone: 619-726-9016

Joe Saraceno FOA Trade Show Santa Anita Park Arcadia, California March 20, 2025 Phone: 619-726-9016

Florida 7-Eleven Franchisees Charity Golf (Central Florida FOA, South Florida FOA, United Franchise Owners Of Florida FOA) Orange County National Golf Course Winter Garden Florida April 3, 2025 Phone: 207-415-0924

Florida 7-Eleven Franchisees Trade Show (Central Florida FOA, South Florida FOA, United Franchise Owners Of Florida FOA) Gaylord Palms Kissimmee, Florida April 4, 2025 Phone: 207-415-0924

Southern California FOA Annual Trade Show Pasadena Convention Center Pasadena, California April 8, 2025 Phone: 818-357-5985

Southern California FOA 38th Annual Charity Golf Tournament Pacific Palms Resort City of Industry, California April 9, 2025 Phone: 818-357-5985

continued from page 58

Nor-Cal United Trade Show (Central Valley FOA/ Greater Bay FOA/ Northern California FOA/ Sacramento Valley FOA)

Midwest FOA Trade Show

Chicagoland FOA Annual Picnic

Venue TBD May 21, 2025 Phone: 847-971-9457

Venue TBD July 19, 2025 Phone: 847-595-1596

Sunrise Banquet Hall and Event Center Vacaville, California April 16, 2025 Phone: 707-344-6287

Midwest FOA Golf Event

Keystone FOA Trade Show

Nor-Cal United Golf (Central Valley FOA/ Greater Bay FOA/ Northern California FOA/ Sacramento Valley FOA)

Chicagoland FOA Charity Golf Event

Venue TBD April 17, 2025 Phone: 707-344-6287

Venue TBD May 22, 2025 Phone: 847-971-9457

Venue TBD May 28, 2025 Phone: 847-595-1596

Chicagoland FOA Annual Trade Show

Delaware Valley FOA Trade Show

Venue TBD May 29, 2025 Phone: 847-595-1596

Harrah’s Atlantic City Atlantic City, New Jersey April 29, 2025 Phone: 215-852-4738

Suburban Washington FOA Tri-State Area Trade Show

South Nev/Las Vegas FOA Golf Event Arroyo Golf Club Las Vegas, Nevada April 30, 2025 Phone: 702-569-9755

Venue TBD June 4, 2025 Phone: 301-580-0305

San Diego FOA Charity Golf Tournament

South Nev/Las Vegas FOA Trade Show

Rancho Bernardo Inn San Diego, California June 11, 2025 Phone: 619-713-2411

Alexis Park Hotel Las Vegas, Nevada May 1, 2025 Phone: 702-569-9755

San Francisco/Monterey Bay FOA Annual Trade Show

Michigan FOA Trade Show

Venue TBD June 18, 2025 Phone: 408-203-1039

Venue TBD May 1, 2025 Phone: 586-722-4133

Rocky Mountain FOA Charity Golf Event

Eastern Virginia FOA Annual Charity Golf Event Venue TBD May 7, 2025 Phone: 757-506-5926

Eastern Virginia FOA Annual Trade Show

Venue TBD August 12, 2025 Phone: 609-353-7872

West Coast FOA Annual Charity Fun Shoot & Mini Trade Show Mike Raahauge Shooting Enterprises Corona, California October 16, 2025 Phone: 718-820-6555 or 714-924-8000

Chicagoland FOA Holiday Trade Show Venue TBD November 13, 2025 Phone: 847-595-1596

Rocky Mountain FOA Holiday Party Venue TBD December 6, 2025 Phone: 719-661-1048

West Coast FOA Holiday Party Venue TBD December 12, 2025 Phone: 718-820-6555 or 714-924-8000

Baltimore FOA TriState Trade Show Venue TBD April 26, 2026 Phone: 443-506-8380

Venue TBD June 26, 2025 Phone: 719-661-1048

Rocky Mountain FOA Trade Show Venue TBD June 27, 2025 Phone: 719-661-1048

Venue TBD May 8, 2025 Phone: 757-506-5926 2024 ISSUE 4 AVANTI 57

NCASEF BO AR D MEETINGS National Coalition Affiliate Meeting King Kamehameha’s Kona Beach Hotel Kailua Kona, Hawaii November 12-13, 2024

National Coalition Board Of Directors Meeting

NCASEF Board meetings are scheduled one per quarter. For information on Board Meeting sponsorship opportunities, please contact the National Office at 855-444-7711 or nationaloffice@ncasef.com

National Coalition Affiliate Meeting Marriott Resort Puerto Vallarta Jalisco, Mexico February 25-26, 2025

National Coalition Board Of Directors Meeting Marriott Resort Puerto Vallarta Jalisco, Mexico February 27-28, 2025

National Coalition Affiliate Meeting The Westin Chicago River North Chicago, Illinois April 22-23, 2025

King Kamehameha’s Kona Beach Hotel Kailua Kona, Hawaii November 14-15, 2024

FOA EVENTS West Coast FOA Annual Fun Shoot & Trade Show Mike Raahauge Shooting Enterprises Corona, California October 17, 2024 Phone: 714-924-8000

Eastern Virginia FOA Holiday Trade Show Hilton Garden Inn Suffolk Riverfront Suffolk, Virginia November 7, 2024 Phone: 757-506-5926

South Florida FOA Trade Show Venue TBD November 8, 2024 Phone: 954-829-0786 58

AVANTI 2024 ISSUE 4

National Coalition Board Of Directors Meeting The Westin Chicago River North Chicago, Illinois April 24-25, 2025

National Coalition Board of Directors Meeting The Westin Anaheim Resort Anaheim, California July 21, 2025

NCASEF 49th Annual Convention & Trade Show Anaheim Convention Center Anaheim, California July 21-24, 2025

continued on page 57

Chicagoland FOA Holiday Trade Show Fort Lauderdale Marriott Coral Springs Hotel Coral Springs, Florida November 21, 2024 Phone: 847-595-1596

Metro New Jersey FOA Holiday Party Venue TBD November 23, 2024 Phone: 732-910-8854

Southern California FOA Holiday Party Venue TBD November 30, 2024 Phone: 818-357-5985

Midwest FOA Chicago Holiday Showcase Venue TBD December 4, 2024 Phone: 847-971-9457

Nor-Cal United Holiday Party (Central Valley FOA/ Greater Bay FOA/ Northern California FOA/ Sacramento Valley FOA) Sunrise Banquet Hall and Event Center Vacaville, California December 6, 2025 Phone: 707-344-6287

Rocky Mountain FOA Holiday Party Gaylord Rockies Resort & Convention Center Aurora, Colorado December 7, 2024 Phone: 719-661-1048

Central Florida FOA Holiday Party Hilton Tampa Airport Westshore Tampa, Florida December 7, 2024 Phone: 207-415-0924

Detroit FOA Annual Holiday Party Venue TBD December 7, 2024 Phone: 313-942-9696

Hostess Fix the Mix with Top Seller + High Gross Profit 60% Everyday ®

Focus on Top Voids with High APSD Nationally #2 Ranked Hostess® Frosted Donettes® 174320 #3 Ranked Hostess® Powdered Donettes® 171248 #6 Ranked Hostess® Iced Vanilla Zingers® 171259

Why Carry?

Action Steps:

•

ALL stores love High Gross Profit, Hostess® singles have 60% GM/ $1.56 GP EVERYDAY!

•

2023 YTD Hostess® is outpacing the Category growing at +22%, while Category growth is +13%

•

Warehouse Brands Like Hostess® are growth drivers in Packaged Bakery Category for C-Store

•

Sweet baked goods is a winning Category; large, growing, and frequently purchased Category

•

Hostess® Brand contributed 20% to total category growth in 2022 and our innovation alone drove 4%.

•

Hostess® cakes and breakfast pastries have a strong affinity and pair well with coffee and breakfast drinks

•

Mark SKU’s as Carried

•

Set to POG Recommendations

•

Print and place tags on shelf Item

SLIN

Pack/Size

SRP

GP%

GP$

Chocolate Cupcakes

175408

6/3.17 oz

$2.59

60%

$1.56

Top 10

Frosted Donettes®

174320

6/3 oz

$2.59

60%

$1.56

Powdered Donettes®

171248

6/3 oz

$2.59

60%

$1.56

Twinkies®

175407

6/2.7 oz

$2.59

60%

$1.56

Must Have to Drive Profit

Crunch Donettes®

174346

6/4 oz

$2.59

60%

$1.56

Iced Vanilla Zingers®

171259

6/3.81 oz

$2.59

60%

$1.56

Coffee Cake

171270

6/2.89 oz

$2.59

60%

$1.56

Glazed Donettes®

171374

6/3.7 oz

$2.59

60%

$1.56

Devil’s Food Zingers®

171133

6/3.81 oz

$2.59

60%

$1.56

Orange Cupcakes

171343

6/3.38 oz

$2.59

60%

$1.56

All costs/retail are national averages. Please refer to the ISP for exact cost/retail by store.