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March/April 2020

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Let's Stay Safe, Stay Healthy, But Don't Let SEI Off The Hook Is SEI Sowing Discord In The Franchisee Community? COVID-19 Pandemic-Related Insurance Coverages COVID-19 In New York– The Unimaginable 7-Eleven Franchisee Misclassification Case: Update on AB 5

V O I C E

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7 - E L E V E N

F R A N C H I S E E S

The New Normal: Balancing Profits & Health Navigating The COVID-19 Pandemic: NCASEF Educational Webinars Emergency Planning And Pandemic Response For Your Employees and Customers

Visit NCASEF.com and sign up for Dispatch!

Join Us! NCASEF 2020 CONVENTION Gaylord National Resort & Convention Center National Harbor, Maryland

August 10-13, 2020

PRSRT STD U.S. POSTAGE PAID Philadelphia, PA PERMIT No. 5634


THE VOIC E OF 7-ELEVEN FRANC H ISEES

March/April 2020

Join Us!

Contents 27 Let’s Stay Safe, Stay Healthy, But Don’t Let SEI Off The Hook By Jay Singh, Chairman, NCASEF, President, South Texas FOA

31 Is SEI Sowing Discord In The Franchisee Community?

NCASEF 2020 CONVENTION Gaylord National Resort & Convention Center

Sign Up For Dispatch Email Newsletter: Page 57

National Harbor, Maryland

August 10-13, 2020 A Message From A Non-Profit Leader: Thank You.

By Michael Jorgensen, Executive Vice Chairman, NCASEF, President, Central Florida FOA

Rob Bernstein, Esq, Laner Muchin Ltd.

49 7-Eleven Franchisee Misclassification Case: Update on AB 5 By Jaspreet Dhillon, NCASEF Treasurer, President, Franchise Owners Association of Greater Los Angeles

53 Emergency Planning And Pandemic Response For Your Employees And Customers John Harp, CSP, ARM— MSIG Insurance Group

COVID-19: An Important Message About Best Practices, page 11

In Memoriam: Thomas Winn Page 16

Deadline For Franchisee Certification Extended To April 30, page 57 NCASEF Opposes Measures To Weaken California Law AB 5, page 57

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 1001 Pat Booker Road, Suite 206, Universal City, TX 78148. For membership information, call 702-249-3301 or e-mail nationaloffice@ncasef.com. AVANTI Offices are located at 116 Bellevue Ave., Suite 304, Langhorne, Pennsylvania 19047. For advertising information, call Sheldon Smith at 215 750-0178 or fax to 215 750-0399; on-line, send messages to sheldon.smith5@verizon.net. 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.

7-Eleven In Dallas International Airport Page 20

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45 Navigating The COVID-19 Pandemic: NCASEF Educational Webinars

An Open Letter To SEI, page 11

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By Arnold Hauptman, General Counsel, UFOLI and New York

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NCASEF’s Response To SEI’s COVID-19 Support Plan, page 10

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41 COVID-19 In New York— The Unimaginable

By Rob Butcher, Swim Across America CEO

PA R

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

Dispatch at NCASEF.com

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35 COVID-19 Pandemic-Related Insurance Coverages

Member News......8

Bits & Pieces...............12 Join Your Local FOA.........14

Legislative Update...................24 SEI News..........................................70 Vendor Focus................................74 FOA Meetings Calendar........77 Franchisee Calendars..........78

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

SEI Announces Franchisee Support During Pandemic SEI says it has committed nearly $95 million to support its franchisees during the COVID-19 pandemic as they provide their local customers the food, beverages, household essentials and other critical supplies they need in a clean and safe environment, reported Convenience Store News. (See the Coalition’s response to this announcement in Dispatch, page 10). According to the article, the corporate commitment to franchisees includes support in the following areas: ● Operations Credits—SEI provided direct payment of credits that will result in millions of dollars in cash-flow assistance to franchisees in March, April and the coming months. These adjustments include direct payments of Operations Credits to franchisees, waiving the April advertising fee, waiving the interest that franchisees pay on their inventory, and passing along thirdparty renegotiated maintenance fees.

● Investing In Clean & Safe Stores—The company has installed plexiglass sneeze guards at the front sales counters to help reduce the spread of the

coronavirus. SEI also said it continues to purchase and supply franchisees with necessary cleaning supplies, at its own expense, to support franchisees in keeping their employees safe and their stores clean. Supplies include hand sanitizer, hand soap, sink sanitizer, gloves, disinfectant, social distancing floor decals, thermometers, face masks and face shields. The company further stated it is committed to keeping the stores stocked with essential supplies that are in high customer demand by leveraging the brand's strong relationships in merchandising and procurement.

● Financial Consulting—SEI set up a Franchise Financial Solutions Center to work together with franchisees to navigate their individual issues caused by the COVID-19 crisis. SEI said it is also engaged in continuing efforts to enhance the ability of franchisees to obtain loans through government stimulus programs.

See page 10 for NCASEF’s response to SEI’s pandemic support announcement.

Jatinder Singh NATIONAL CHAIRMAN

702-249-3301 • jays@ncasef.com

Michael Jorgensen EXECUTIVE VICE CHAIRMAN

347-251-1828 • mcjorg@yahoo.com

Paul Lobana VICE CHAIRMAN

818-203-2527 • paullobana@aol.com

Rehan Hashmi VICE CHAIRMAN

847-845-8477 • rehan711@yahoo.com

Ajinder Handa VICE CHAIRMAN

425-438-8381 • ajinderhanda@hotmail.com

Jaspreet Dhillon TREASURER

310-892-2106 • jaspakam@gmail.com

Shawn Howard OFFICE MANAGER

210-971-9211 • shawnh@ncasef.com

Eric H. Karp, Esq. GENERAL COUNSEL

617-423-7250 • ekarp@wkwrlaw.com

John Riggio MEETING/TRADE SHOW COORDINATOR

262-275-3086 • jrpinc@charter.net

Sheldon Smith AVANTI PUBLISHER ADVERTISING MANAGER

215-750-0178 • sheldon.smith5@verizon.net

Steps To Continue Serving Customers As the world faces unprecedented measures to stop the spread of coroncontinued on page 12

Sheldon Smith PUBLISHE R & ADVERTISING SALES 215 750-0178 SHELDON.SMITH5@VERIZON.NET

The National Coalition Office 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 Universal City, Texas. 8

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John Santiago ASSISTANT EDITOR 215 750-0178 AVANTIMAG@VERIZON.NET

1001 Pat Booker Road Suite 206 Universal City, TX 78148 Office 210-971-9211 E-mail: nationaloffice@ncasef.com

The Voice of 7-Eleven Franchisees March/April 2020 © 2020 National Coalition of Associations of 7-Eleven Franchisees Avanti Magazine is the registered trademark of The National Coalition of Associations of 7-Eleven Franchisees.


NCASEF

HIGHLIGHTS

Your National Coalition is Committed to Franchisee Interests “SEI rolled out a public relations campaign announcing $95 million in ‘franchisee financial support.’ But, like so much of SEI’s communication, the message was misleading.”

set to be distributed across the system, but ONLY to stores which stay open a minimum of 16 hours per day. Stores that have been mandated to close, and stores that have been unable to stay open because of the pandemic, don’t qualify. Because not all stores will qualify, the $37 million figure is inflated. The $5,000 credit is really an incentive for you to keep Recently, SEI announced its plan to support franyour stores open. It will barely make whole many stores chisees during the COVID-19 pandemic. At a time of unthat are struggling. with lower customer counts and lost precedented loss in our stores and concern about being sales, especially in communities that have prohibited selfon “the front lines,” SEI rolled out a public relations camservice food and drink stations. Providing hazard pay to paign announcing $95 million in “franchisee financial supemployees—as SEI is doing for its corporate stores—will port.” But, like so much of SEI’s communication, the eat up one-third to one-half of this credit. message was misleading. 3. Waiving April Ad Fund Fee: Marketing The National Coalition took a closer look at and advertising has dropped during this pethe numbers only to find the company is givriod and, since 7-Eleven is not buying ing us a whole lot less than what as many ads and promotions, they are telling the public—and they are simply letting us keep taking credit for. money that is not being spent. SEI produced a graphic This gives the public the illuto show franchisees what sion that stores are getting they are supposedly $6 million in support when getting to lessen the it is really a publicity grab. pain from the COVID-19 The most prevalent adverpandemic. Let’s break tising we see now is directed down the five numbered “This is really a support plan for the stores and not at selling franchises. points along the top half: the franchisees. It is an illusion to generate 4. Postponed CEV & 1. Accelerating the Ops public relations for the company.” Brand Excellence for April: Credit of $2,250 per store: SEI is not spending money it This $18.4 million “credit” was first announced in February budgeted for CEV and Brand Excellence, so it is realloat the 7-Eleven Experience and was already scheduled to cating the money to franchisees. The CEV program is not be sent to franchisees long before the national emermoney well-spent. Visits are invasive and violate our stagency was sounded. This credit has nothing to do with tus as independent contractors. the COVID-19 response and including it in a COVID sup5. Restructuring Maintenance Contract: We believe the port plan is misleading. This credit is acknowledgement $12 million savings from “restructuring” the maintenance of the imbalance in the 2019 Franchise Agreement. The contract is the result of money the company is not spendNational Coalition has always maintained the agreement ing because it is not doing preventive maintenance and was both unfair and imbalanced. most equipment is not getting serviced. 2. April Ops Credit of $5,000 per store: $37 million is

NCASEF’s Response To SEI’s COVID-19 Support Plan

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“It is misleading to say 7-Eleven is giving its franchisees $95 million to cope with the COVID-19 pandemic. The actual amount of cash we are receiving is a lot less, and in no way covers our losses,” said National Coalition Treasurer Jaspreet Dhillon. “This is really a support plan for the stores and not the franchisees. It is an illusion to generate public relations for the company.”

An Open Letter To SEI Let’s be clear and honest. The 7-Eleven system as we know it today has been and will continue to be unsustainable. Before the pandemic, 7-Eleven implemented a series of unreasonable changes which continue to negatively impact franchisee financials. Now, during this pandemic, many stores are seeing a dramatic sales decline and all stores are confronting serious health, safety and labor issues. When this is all over, we will be left with crippling debt and an uncertain future. To be brutally honest, many franchisees are in very real danger of not being able to survive the financial fallout from this pandemic beyond May. This ship is sinking fast. The reality is that a failure of a massive number of franchisees will not necessarily be due to any failure on their part, but by the failure of the management to accept the very flawed nature of the system and the Franchise Agreement itself. The failure of any significant number of franchisees will have a dramatic and lasting impact on the entire 7-Eleven sinking. 7-Eleven has an obligation to protect the Brand. Providing the necessary cleaning products, safety materials and equipment to all stores during this pandemic is very critical to keeping stores open, no matter what costs SEI might bear. It is obvious that some stores would be better off closing due to safety, liability, financial and labor concerns in this pandemic. A $5,000 operation credit distracts many franchisees from making this very important calculation. Tying this credit to a 16-hour-a-day require-

“Tying the $5,000 credit to a 16-hour-aday requirement does not help all franchisees, and restricts many from accessing this support, including those most in need and more significantly closed stores.”

ment does not help all franchisees suffering and restricts many from accessing this support, including those most in need and more significantly closed stores. We keep reading statements and watching videos issued by 7-Eleven that SEI has committed nearly 95 million dollars to support franchisees. These aggregate numbers which have been provided to franchisees and distributed to the press are very misleading and self-serving; what SEI is giving with the left hand is a fraction of what they took with the righthand last year with the 2019 agreement. Although we commend SEI for that action we feel strongly that to avoid the sinking of this ship, SEI must take the following actions immediately until December 31, 2020: • Reduce the 7-Eleven charge by 30 percent. • Suspend the advertising fee. • Defer all loan payments that franchisees have with SEI. • Reduce all maintenance charges by 50 percent. • Eliminate the credit card fees. • Eliminate the interest fee. • Lend funds to franchisees to stay above water, with 1 percent interest for 5 years for any under equity issues. We hope that SEI will take note and act quickly. We hope we all survive this pandemic and are able to focus on how to make this Brand stronger for all of us—franchisees and SEI.

COVID-19: An Important Message About Best Practices In this unprecedented time in our nation's history, your NCASEF Executive Board wants you to know we stand with you and that we are working diligently to help you run your businesses. Now, more than ever, it is crucial that we do all we can to keep our families and employees safe while continuing to serve our communities. Customers have relied on us continued on page 56

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avirus (COVID-19), SEI announced some of the steps it is taking to protect customers and franchisees. In a press release, the company said its 7NOW delivery app has added a contactless delivery option where customers can indicate if they prefer their delivery “contactless,” meaning the delivery is left at the door by the driver. SEI also said it has enhanced its standards and procedures for hygiene, handwashing, sanitation, food handling and preparation in stores and increased the frequency of cleaning high-touch surfaces. A leadership team at the Store Support Center is dedicated to staying up-to-date with the Centers for Disease Control and Prevention (CDC) and World Health Organization (WHO) guidelines to make the best adjustments to business operations and policies as needed. Additionally, SEI said it is taking the following steps to keep people safe and stores clean: ● Employees and franchisees are being asked to stay home if they have any symptoms of the COVID-19 illness or feel sick. Customers are asked to do the same so that 7 Eleven store employees can continue to serve the community. Products can be delivered through the 7NOW app. ● The company is implementing pre“e 7NOW cautionary measdelivery app ures for all fresh food offerings: 1) now has a All open-air fresh contactless food items will be clerk-served indelivery cluding taquitos, option.” hot dogs, hot

chicken wings and tenders, and pizza. 2) Daily delivered fresh bakery goods, as well as any items baked in-store, will now be sold pre-packaged. 3) The fresh condiment bar has been replaced with a selection of pre-packaged condiments. ● CDC-recommended hygiene posters are displayed in high-traffic areas in stores. ● 7 Eleven stores have discontinued the use of personal cups for hot and cold dispensed beverages. Participating stores will still offer the refill discount on one-time use 7 Eleven cups in stores for anyone who brings in a personal cup. ● Working to ensure stores remain instock with high-demand, essential products. ● Stores will continue to provide quality products at fair, honest prices.

7-Eleven Adds Jobs During Pandemic SEI recently announced it expects franchisees and corporate to hire as many as 20,000 new store employees in the near future to meet increased demand for 7-Eleven products and services amid the COVID-19 pandemic. “7-Eleven is a neighborhood store and it’s our priority to serve the communities in which we operate during this unprecedented crisis,” said 7-Eleven President and Chief Executive Officer Joe DePinto. “Between 7-Eleven, Inc. and our franchised business owners, we expect as many as 20,000 store employees to be hired in the coming months.” SEI also anticipates the store employee position would meet a surge in mobile orders through its 7NOW delivery app, which offers delivery of essentials and nonessentials to more than 30 million households across continued on page 16

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Mondelēz International, Inc. announced it will donate $15 million in financial and inkind support to community partners advancing critical food stability and emergency relief efforts across the world in the wake of the COVID-19 crisis. • Altria Group, Inc. temporarily suspended operations at its Philip Morris USA Manufacturing Center in Richmond, Virginia, after learning that a second employee tested positive for COVID-19. Also, the company’s CEO stepped aside temporarily after contracting the virus, handing the reigns to Altria’s chief operating officer. • As consumers scurried to hoard toilet paper at the height of the coronavirus panic, one creative person built a toilet paper calculator — a website (howmuchtoiletpaper.com) that you can use to input how many rolls you have on hand and how often you make trips to the toilet each day, to make an estimate of how long your stash should last, reported the New York Post. • Vita Coco recently announced that it will donate $1 million of its incremental profits to Feeding America and No Kid Hungry to support families, children and seniors in the most vulnerable communities affected by the coronavirus outbreak and beyond. The company said it experienced an unexpected sales surge— upwards of 100 percent across major retailers— for its shelf-stable coconut water during the pandemic. • Private companies cut 27,000 jobs before a majority of the shutdowns for the coronavirus pandemic hit the U.S., reported The Hill, citing an analysis by ADP and Moody’s Analytics. The number of private-company jobs cut was only counted through March 12, before shutdowns began happening. • Constellation Brands recently announced that the COVID-19 virus has had no impact on sales of its Corona beer brand, despite unfounded concerns that it has affected the company’s business. Constellation Brands said that based on recent continued on page 16


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A Message From A Non-Profit Leader: Thank You. By Rob Butcher, Swim Across America CEO “Our commitment is to continue providing hope to the individuals and • Our team is sharing sto- families affected by canries about our grant partners cer through support, into bring you hope and inspispiration, and leadership.”

For three decades, Swim Across America has been hosting charity swims. The proceeds from our charity swims are then granted to fund cancer research. Since our first charity swim in 1987, we’ve granted around $100 million dollars to our hospital partners who have been at the forefront of developing new cures and treatments to fight cancer.

swims as our volunteers are experiencing their own challenges.

Our commitment is to continue providing hope to the individuals and families affected by cancer through support, inspiration, and leadership.

ration. Our grants continue to fund more than 60 oncology projects and the thousands of nurses, researchers, and patients within the programs.

The values of Swim Across America are rooted in family. We are grateful for the wisdom of our board members, whose steady leadership has guided Swim Across America through times of hardship; for example, weathering the storms of 2001 and 2008. Lessons from other times of crisis have helped to prepare Swim Across America for uncertainty. Like many businesses, we’ve tightened our belts. Thanks to guardrails having been put in place years ago to safeguard our cause, we are facing these times with the strength of community and family. • Our team is taking on more local responsibility for our charity

• Our team is creating new opportunities so the spirit and purpose of teams like Team Amazing Grace can continue to make an impact. A tour in honor of Grace Bunke planned across 14-of our charity swims this year is being adjusted. Thank you to our supporters, partners, and volunteers. You’ve shown your trust in us. We don’t take it for granted. We want you to know how much we appreciate you. We are here for you now and as we continue to move forward, together.

Join Your Local Franchise Owner’s Association Today! The best way to stay informed of the latest changes and challenges to our 7-Eleven system—and the convenience industry, in general—is to join your local Franchise Owner’s Association. FOAs help franchisees share ideas and concerns, and allow us to approach “None of us is as great our franchisor and vendor as all of us together.” partners with a unified voice. Becoming an FOA member also makes you a member of the National Coalition, which consists of all 41 FOAs nationwide. To join your local organization, contact the FOA president closest to you, or follow the instructions below to fill out an online membership form. If you cannot find the FOA closest to you, contact nationaloffice@ncasef.com for more information. We welcome your participation!

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How do I join an FOA? 1. Log in to 7 Help using 7 Hub (secured) in-store or using this link https://7elevenna.service now.com/ from any external device. 2. In the search bar type “FOA.” 3. Select the popup suggestion “FOA/PAC: FRANCHISE OWNERS ASSOCIATION.” 4. Type “NONE” in the “Current FOA” box if you are joining an FOA for the first time or you are not a member of any other FOA. 5 Type in the full name of the FOA that you wish to join (No abbreviation) in the “Future FOA” box. 6. Type in the amount of monthly dues as instructed per local FOA. 7. Type “Please enroll (store number) as a member of (name of the local) FOA.” 8. Repeat Step 7. 9. Press the green submit icon.


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“SEI said it has provided all stores and franchisees with a supply of masks for use by storeowners and their employees and donated all remaining inventory to FEMA.” the United States. “Locally owned and operated 7-Eleven stores are really going above and beyond to serve their communities,” said DePinto. “I’d like to thank 7Eleven franchisees and corporate store employees for everything they are doing to provide necessary products and services to customers in need.”

SEI Donates Juice To Childcare Program SEI has donated 1,000 bottles of juice to the YMCA’s Emergency Childcare Program of Metropolitan Dallas in response to COVID-19 and to support the Dallas-Fort Worth community, reported TV news station CBS DFW. The Emergency Childcare Program provides support to essential working families (first responders, healthcare professionals, retail and supply chain staff) who do not have a place for their children to go during the workday. Each day the kids par-

ticipate in the education of healthy habits, STEM activities, arts enrichment, supported distance learning, and physical activity. The program provides 350 children with a meal and snack/juice/milk twice a day across six locations in the DFW metroplex. It operates in part through generous donations and serves families who need safe, affordable childcare during the COVID-19 period.

Free Car Washes To Medical Staff & First Responders 7-Eleven stores in Virginia Beach and Norfolk, Virginia thanked medical staff and first responders by providing free car washes, reported WTKR CBS 3. The free car washes were available during the month of April. All Virginia Beach and Norfolk medical staff and first responders needed to do was provide an ID, professional ID or badge to receive a continued on page 19

In Memoriam: Thomas Winn The 7-Eleven franhicsee community mourns the loss of Thomas Winn, a long-time storeowner and franchisee leader, who passed away on February 19, 2020. Tom and his wife Sandy franchised their first of three Oregon stores in 1980, and became very active in their local FOA. Tom served as Vice President of the Southern FOA and on the National Coalition Board as Merchandise Manager. In his retirement years, Tom kept busy as the Operation Manager of the Oregon Air and Space Museum. The officers and Board members of the National Coalition send their sincerest condolences to Tom’s wife of 63-plus years, Sandy, to his sons, daughter, grandchildren, greatgrandchildren, and his entire family. Tom will always be remembered as a champion of franchisee rights, and as a great friend. 16

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IRI retail trends, sales of Corona Extra remain strong, with dollar sales up 5 percent in the U.S. per the 4-week period ended February 16, nearly doubling the 52-week trend for the brand. • A Labor Department report reveals that, as recently as February, unemployment insurance trust funds in nearly half the states were underfunded, reported NBC News. The department’s report found that 22 states fell below the threshold for the recommended minimum adequate solvency level, including Pennsylvania, Ohio, Massachusetts, Texas and California—the five states with the highest weekly jobless claims during the COVID-19 pandemic. • Amazon has started selling the cashierless checkout technology that powers its Go convenience stores to other retailers, reported CNBC. The “Just Walk Out” technology enables shoppers to take what they want and leave without the need to stop and stand in a checkout line. Amazon said it has already made several deals with retailers interested in bringing the cashierless technology to their stores. • Target increased pay for its hourly employees by $2 per hour through at least May 2, and offered bonuses of between $250 and $1,500 to team leaders who supervise store departments, as part of a $300 million package of initiatives designed to serve consumers and keep stores stocked as the coronavirus outbreak continued to drive demand, reported CNBC. • Waffle House, the Georgia-based diner chain known for its disaster preparedness and ability to stay open during hurricanes and tornadoes, temporarily closed 420 of its nearly 2,000 locations as the coronavirus spread around the US—a sign, chain aficionados said, of just how serious the pandemic had become, reported the New York Post. • PepsiCo plans to acquire Rockstar Energy in a $3.85 billion deal, doubling down on energy drinks as soda consumption declines in the U.S., reported CNBC. Pepsi has had a distribution continued on page 20


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free car wash code at all Virginia Beach and Norfolk 7-Eleven car wash locations.

Focus Is On Food Sales During Pandemic Convenience retailers say they have seen an increase in sales of grocery staples as customers increasingly turn to their local c-store for pantry items, according to a national survey conducted by NACS. Some of the study’s findings include: ● More than half of convenience retailers (52 percent) say their grocery sales have increased. ● Convenience stores are offering more at-home product—52 percent are adding more cleaning/toiletry items, 31 percent are emphasizing ready-toheat meals, 28 percent are offering more multi-pack/bulk items. ● Stores have dramatically scaled back self-serve foodservice and restaurant functions, but are offering new programs to allow social distancing and to enhance convenience—14 percent are offering some sort of curbside pickup program and 11 percent have added or increased delivery options, 66 percent have closed public seating and dining areas, and 45 percent have removed customer access to self-serve foodservice.

“Stores have dramatically scaled back self-serve foodservice and restaurant functions, but are offering new programs like curbside pickup to allow social distancing.”

boro, Kentucky, was working on the de● Virtually all retailers (99 percent) say velopment of the vaccine on a not-forthey have enhanced their cleaning proprofit basis. BAT said that it could tocols for high-touch surfaces, with produce between 1 million and 3 million regular cleaning conducted as often as doses per week starting in June with every 20 minutes. backing from the partners and govern● Convenience retailers are supporting ment agencies. medical/healthcare personnel and first responders with free beverages and dis“British American Tobacco is working counted food.

Plexiglass Sneeze Guards

on a COVID-19 vaccine inserted into tobacco plants for reproduction.”

SEI has installed plexiglass sneeze guards at the front sales counter in 9,000plus U.S. stores to help reduce the spread of the coronavirus, COVID-19. Installations began at stores in areas hardest hit by the pandemic and expanded to include all U.S. stores. Installations were completed in all stores within two weeks, the company said in a press release. Each store received two of the transparent plastic barriers. All sneeze guards were made in North America. For easiest customer access, credit card PIN units have been located on the customer-facing side of the plexiglass sneeze guards.

BAT Developing Potential Coronavirus Vaccine British American Tobacco (BAT) said it has made a “significant breakthrough” on a potential vaccine for COVID-19 using tobacco plants, reported Newsweek. The company, which makes Lucky Strike cigarettes, announced recently that its U.S. biotech unit Kentucky BioProcessing (KBP), based in Owens-

KBP recently cloned a portion of COVID-19's genetic sequence to create an antigen, which induce an immune response in the body and produce antibodies, BAT said. According to the company, the antigen was inserted into tobacco plants for reproduction and once the plants were harvested, the antigen was purified. The vaccine is now undergoing pre-clinical testing.

1 Million Masks to FEMA SEI has donated 1 million masks to the Federal Emergency Management Agency (FEMA) to aid the medical community tirelessly battling the coronavirus pandemic. Hospitals are facing critical shortages of personal protective equipcontinued on page 20

7-Eleven, Inc. has donated 1 million masks to the Federal Emergency Management Agency (FEMA) to aid the medical community who are tirelessly battling the coronavirus pandemic. (Source: Press Release) AVANTI m a r c h | a p r i l 2 0 2 0

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ment (PPE) that includes masks and gloves. The shortage has led to hospitals re-using masks and American volunteers sewing masks at home to donate to local hospitals. SEI said it has provided all stores and franchisees with a supply of masks for use by storeowners and their employees as they serve customers in their stores, and has donated all remaining inventory to FEMA.

Pandemic Driving Grocery Shoppers To C-Stores Among the many impacts of the COVID-19 pandemic, convenience stores are seeing an increase in shoppers who typically would go to supermarkets for their grocery needs, reported Convenience Store News, citing a recent

study conducted by its parent company, EnsembleIQ. Fifteen percent of shoppers said they are more likely to shop at convenience stores for groceries due to the pandemic. Among shoppers who are visiting other stores aside from their preferred stores, 58 percent said it is due to product availability, while 34 percent said the substitute location is more convenient at a time when they do not want to travel further than they have to. Other highlights from the findings include: ● 23 percent of shoppers are making a fill-in shopping trip more often due to the pandemic, especially millennials. ● 22 percent of shoppers are making a quick shopping trip for one to five items more often due to the pancontinued on page 22

7-Eleven In Dallas International Airport Pictured here are photos of one of the four 7-Eleven stores located inside Dallas Fort Worth International Airport. These stores—located in terminals A, C, D, and E—offer wearied travelers customer favorites like Big Gulp and Slurpee drinks, coffee, 7-Select products and other popular convenience store go-to items. The Terminal C store is the latest, opening in May 2019.The first opened inside Terminal A in October 2015.

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agreement with privately held Rockstar in North America since 2009. • As of April 5, about 31 percent of the U.S. households hadn’t paid rent for the month, according to a National Multifamily Housing Council study that tracks how the pandemic is affecting the housing market. • Costco Wholesale reported a 12.1 percent rise in March same-store sales, the retailer’s biggest increase in at least seven years, as consumers continued to stock up on food and essentials during the pandemic, reported Bloomberg. The growth was tempered by shortened store hours and limits on the number of shoppers allowed in the store at one time. • Sheetz launched a Kidz Meal Bagz program providing free food to help children and families in need as a result of the COVID-19 pandemic. Meal Bagz included a turkey sandwich, chips and a drink and were available beginning April 2 for a two-week period at 294 Sheetz stores across Pennsylvania, Maryland, Ohio, North Carolina, Virginia and West Virginia. The company said it may continue the program after the two weeks based on community need. • Amazon founder and CEO Jeff Bezos recently donated $100 million to food banks across the U.S. so they could feed needy Americans as the novel coronavirus crippled the economy, reported CBS News. The donation went to Feeding America, a Chicago-based network of more than 200 food banks that feeds 46 million people. • Crocs launched a “Free Pair for Healthcare” program during the coronavirus outbreak, giving away free shoes to healthcare workers, reported CNN. The free shoes were available via Crocs.com. The company also donated up to 100,000 pairs of shoes to be distributed to employees at select healthcare facilities and organizations. • Apple Inc. and Google recently unveiled a rare partnership to add technology to their smartphone platforms that will alert users if they have come into contact with a person with COVID-19, reported Bloomberg. People must opt in to the system, and the technology—known as contact-tracing—is designed to continued on page 29

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demic, especially urban consumers. ● 19 percent of shoppers are shopping more often for immediate consumption than they did before the pandemic, especially urban consumers and millennials. ● 27 percent of shoppers who typically shop at convenience stores for groceries have a high level of trust that retailers are ensuring safe handling when preparing and delivering orders. In comparison, only 16 percent to 17 percent of shoppers who typically shop at grocery stores or supercenters for groceries have a high level of trust.

an additional $2.50 an hour, and RaceTrac has given a $3 per hour pay increase to hourly store team members through April, plus $150 weekly extra pay for general managers at the store level through April. Kum & Go has raised pay for all store associates, including general managers, by $2 an hour at least until May 3 and backdated to March 16. The Des Moines, Iowa-chain said it also is offering spot bonuses to associates who lead COVID-19 sanitation safeguarding, and “thank you” bonuses to all general managers and district supervisors.

C-Stores Hike Employees’ Wages During Pandemic

No More Self-Serve

The coronavirus outbreak is threatening America's vast convenience store Convenience stores continue to industry as consumers fill up at the show their employees how much they’re pump less frequently and companies pull valued by boosting pay and other incenself-serve soda machines and hot dog tives as COVID-19 affects a growing rollers, reported CNN Business. While number of communities, reported NACS the outbreak does not appear to be a Online. Casey’s General Stores has given death knell for the industry, chains are all full-time and part-time store employfacing major challenges to their busiees an additional $2 per hour to show apnesses, the article states. preciation and support for the team Demand for gasoline—which makes members who are on the frontlines of up more than 60 percent of convenience serving local communities. Managers, store sales—has been crushed, as millions supervisors and trainers receive an addiof Americans are currently under sheltertional $100 per week. in-place orders and have stopped driving Wawa is recognizing the hard work to and from their jobs. IHS Markit estiof its associates “with additional pay and mates that U.S. gasoline demand may colby continuing to review and update paid lapse by more than 50 percent during the time off policies to be more flexible and coronavirus response period. Convensupportive, and to minimize the impact ience stores can't easily to them should they replace those sales, esbe affected by pecially because fewer “C-store operators COVID-19.” Sheetz are staying open 24 countrywide have has increased the pay hours during the crisis for its employees by raised wages for to provide more time $3 an hour, retroacto clean down stores store associates and tive to March 13 and overnight. continuing through managers during Additionally, around April 23. Circle K has the pandemic. ” a quarter of convengiven its employees ience chains’ sales in-

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side stores come from prepared foods. But companies have been forced to scale back or eliminate self-serve food and drink offerings amid the crisis and close down their diner seating areas. In response to the outbreak, c-stores are rapidly pivoting their businesses. They are trying to become fill-in stops when shoppers find their local grocery store or big-box retailer has run out of toilet paper, hand sanitizer or water, experts say. This approach is helping chains blunt the impact of declining gas and food service sales.

Record Unemployment Claims The number of Americans filing claims for unemployment benefits surged to record highs as more states and cities enforced strict stay-at-home measures in an attempt to stop the coronavirus pandemic, reported Fox Business. In the four-week period of March 16 to April 11, the total number of Americans who filed for unemployment was just over 22 million, a stunning sign of the colossal economic damage inflicted by the outbreak. The week ending March 21 saw 3.3 million first-time unemployment claims filed, with 6.6 million filed the following week, then 6 million the week ending April 4, and 5.245 million firsttime unemployment claims filed the week ending April 11. Before the coronavirus forced large swaths of the economy to shut down, the highest jobless claims reported was 695,000 in 1982. The peak during the Great Recession was 665,000 in March 2009. Every state reported an increase in unemployment claims during the pandemic. The largest number of filings continued on page 58


Legislative Update New Paid Time Off Rule In Effect e Families First Coronavirus Response Act (FFCRA), signed into law by President Trump in mid-March, created new paid time-off requirements for businesses with fewer than 500 employees, reported NACS Online. FFCRA requires certain employers to provide their employees with paid sick leave, or expanded family and medical leave, for specified reasons related to COVID-19. “THE FAMILIES FIRST Generally, the measure provides that covCORONAVIRUS ered employers must provide to all emRESPONSE ACT, ployees: SIGNED INTO LAW BY ● Two weeks (up to 80 hours) of PRESIDENT TRUMP IN paid sick leave at the employee’s regular MID-MARCH, CREATED rate of pay if the employee is unable to NEW PAID TIME-OFF work because the employee is quaranREQUIREMENTS FOR tined, and/or experiencing COVID-19 BUSINESSES WITH symptoms and seeking a medical diagnoFEWER THAN 500 sis; or EMPLOYEES.” ● Two weeks (up to 80 hours) of paid sick leave at two-thirds the employee’s regular rate of pay because the employee is unable to work because of a need to care for an individual subject to quarantine, or care for a child whose school or child care provider is closed or unavailable for reasons related to COVID-19. ● A covered employer must also provide to employees that it has employed for at least 30 days up to an additional 10 weeks of paid expanded family and medical leave at two-thirds the employee’s regular rate of pay if an employee is unable to work in order to care for a child whose school or child care

provider is closed or unavailable for reasons related to COVID-19. According to the U.S. Department of Labor (DOL) the requirements are not retroactive, meaning any time off employees may have taken before April 1, 2020 is neither subject to the new requirements to provide paid time off nor are companies eligible for the tax credits meant to reimburse employers for those expenses. e FFCRA’s paid leave provisions apply to leave taken between April 1, 2020, and December 31, 2020.

U.S. House Passes Bill Banning Flavored Tobacco Products A ban on flavored e-cigarettes and tobacco products passed the House recently, reported e Hill. The bill is intended to curb the rise of youth vaping rates by banning non-tobacco flavors such as mint and mango that public health experts say lure children into smoking. It would also ban menthol cigarettes, as well as ban online sales of e-cigarettes and restrict advertising and marketing of those products. Democrats hope to pass the bill to present a contrast to the Trump administration’s approach to youth vaping rates. e FDA began enforcing a limited ban in early February on flavored podproducts, like those sold by Juul, with exemptions for menthol and tobacco flavors. It also exempted open-tank and disposable ecigarettes. According to the article, the Senate is unlikely to consider the bill, and President Trump’s advisers said they would recommend he veto it in its current form.

New Jersey May Raise Cigarette Tax To Highest Level New Jersey Governor Phil Murphy recently proposed raising taxes on cigarette sales by $1.65 a pack as part of his third state budget plan—which would tie New Jersey for the highest such tax among U.S. states, reported NJ.com. If approved by state lawmakers, the increase in the cigarette tax would be New Jersey’s first in 11 years, funneling about $218 million more into state government coffers. New Jersey’s cigarette tax is now $2.70 a pack, the 10th highest among the states. Murphy’s plan would increase it to $4.35 a pack, putting it on par with New York and Connecticut. Neighboring Pennsylvania’s tax is $2.60 a pack. Only Washington, D.C.—at $4.50—would have a higher cigarette tax, according to the Tax Foundation. It’s also $4.50 a continued next page

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Legislative Update

pack in Chicago and New York City, which is allowed to add a tax on top of the state tax.

Final Cigarette Warning Label Rule Issued e FDA recently issued its final rule requiring cigarette health warnings for cigarette packaging and advertisements, reported NACS Online. According to the final rule, “New cigarette health warnings must appear prominently on packages and in advertisements, occupying the top 50 percent of the area of the front and rear panels of cigarette packages and at least 20 percent of the area at the top of cigarette advertisements.” In addition, retailers of cigarettes are responsible for ensuring those health warnings are visible to the public and unobscured. In terms of packaging requirements, retailers of cigarettes will not be in violation of the final rule if the cigarette packaging: 1) contains a warning; 2) is supplied to the retailer by a licensed manufacturer or distributor; and 3) is not altered by

the retailer. However, retailers are responsible for ensuring that the health warnings are visible on packages and unobscured by stickers, sleeves or other materials. Retailers will not be in violation of the advertisement requirements if that retailer receives the advertisements from a cigarette manufacturer or distributor. However, if retailers are creating the advertisements, then they must ensure the health warnings meet the new requirements. In all cases, however, the retailer is liable if the retailer publicly displays an advertisement that does not contain a warning or if that warning has been altered by the retailer in a material way or is obscured from view. e final rule will take effect on June 18, 2021.

“THE FDA HAS RULED THAT NEW CIGARETTE HEALTH WARNINGS MUST APPEAR PROMINENTLY ON PACKAGE, OCCUPYING THE TOP 50 PERCENT OF THE AREA OF THE FRONT AND REAR PANELS.”

Sign Up For The Dispatch Newsletter! Sign up today to receive Dispatch, the NCASEF’s email newsletter that keeps you up to date on the latest 7-Eleven news and announcements from national leadership. With all the changes and challenges happening within our system, the Dispatch newsletter serves as a direct line of communication between the National Coalition and the franchisee community. Receive urgent information, alerts, and reports directly from national leadership as it happens.

Head over to www.NCASEF.com and click on the Subscribe to Our Newsletter button on the upper right column of the homepage. Then fill out the form to be placed on the Dispatch email list. AVANTI m a r c h | a p r i l 2 0 2 0

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Let’s Stay Safe, Stay Healthy, But Don’t Let SEI Off The Hook BY JAY SINGH, CHAIRMAN, NCASEF, PRESIDENT, SAN ANTONIO FOA The coronavirus has changed the world as we know it. COVID-19, the illness caused by the virus, is wreaking havoc on the lives of franchisees, our families, our employees, our customers, our vendors and SEI. We have all been through some hard times lately, and we are still not at the end of the pandemic. We have hotspots in New York City, Long Island, Seattle, and to a lesser extent, many of the major cities around the country: Chicago, Detroit, Philadelphia, Los Angeles, Miami and others. As of this writing (April 17), one franchisee in New Jersey has succumbed to the virus, and we still have a long way to go, as the virus has not run its course. The coronavirus affects each and every one of us indiscriminately. It does not see color, class, socioeconomic level or race. It affects each and every one of us individually, and as a group. It affects franchisees and store associates equally. 7-Eleven has shut down its facilities in Dallas to all visitors, and many people are working from home, while franchisees man the front lines of food distribution as essential businesses. It is our lot as franchisees to serve our customers and we love to do it. We just don’t want to risk our lives any more than is necessary. Many franchisees in these troubled areas have to answer the question: Is my loyalty to the brand and my success financially more important than the health of my customers and my employees? When does it get so bad that I close my store? If I do, how can I ever recoup the monies that I have lost? Will 7-Eleven help me? Will their help be enough? In some areas some franchisees are still

seeing hundreds of customers a day as business increases in some neighborhood stores, and decreases in some inner city business districts, and at stores in industrial areas. Gas business has dropped in most areas by 40-50 percent. Many of our employees have quit out of fear. Whatever our customers bring into our stores we take home to our families, potentially putting them at risk. The best advice I can give at this time is, don’t panic. First and foremost, take care of yourselves and your families. Your safety comes first. If you have to shut down your store overnight, do it. If you have to shutter

your store for a length of time out of protection for the people in your universe, or because you don’t have the staffing, do it, but give proper notice to 7-Eleven, Inc. At all costs, do not abandon your store. Follow all the safety instructions coming from health agencies and 7-Eleven. Wear masks, wash your hands, keep social distances, and read all of the health department information. We of course cancelled the NCASEF Board of Directors meeting scheduled for Long Island in May. We are looking to reschedule, but that may not be possible. We do not want any unnecessary travel, and we’re looking into alternatives like

“Whatever our customers bring into our stores we take home to our families, potentially putting them at risk.”

“Many franchisees in troubled areas have to answer the question: Is my loyalty to the brand and my financial success more important than risking the health of my customers and my employees?” videoconferencing and teleconferencing. We have not yet cancelled our convention, scheduled for the Gaylord Hotel in National Harbor, across the Potomac from Washington DC, August 10-13. Earlier this week, it seems that 7Eleven woke up a little bit. In the worst areas, like NYC, they are permitting franchisees to close stores. This is up to the franchisee. If all of your employees have quit, and you have multiple stores, you have no choice but to look for new employees, or close stores. You will however, need to call 7-Eleven and talk it over if this is your course of action. Throughout the country, if your staff deserts you, you have little choice. Your safety comes first! We did get a reassuring letter from Joe DePinto, but how should we react? In the first week of April 7-Eleven made a big announcement in the press about committing $95 million to support franchisees in this crucial time, as they “provide their local customers the food, beverages, household essentials and other critical supplies they need in a clean and safe environment.” continued on page 29 AVANTI m a r c h | a p r i l 2 0 2 0

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continued from page 20

curb the spread of the novel coronavirus by telling users they should quarantine or isolate themselves after contact with an infected individual. • The IRS has extended the federal income tax filing deadline to July 15 as part of a growing effort to stem the financial pain from the coronavirus pandemic, reported CNBC. The move gives Americans three months more than they normally would have to file their income tax returns for the 2019 tax year, without incurring interest or penalties. • Oil giant BP announced that it plans to be carbon neutral by 2050 or sooner. The company has set five directives to help it reach the 2050 goal. Notably, BP wants to slash its carbon and methane intensity by 50 percent and invest more in “non-oil and gas businesses.” • Carbon dioxide emissions could fall by the largest amount since World War Two this year as the coronavirus outbreak brings economies to a virtual standstill, reported Reuters. The Global Carbon Project, which produces widely-watched annual emissions estimates, announced carbon output could fall by more than 5 percent year-onyear—the first dip since a 1.4 percent reduction after the 2008 financial crisis. • The Kroger Co. is testing a pickup-only store in Cincinnati in response to higher demand for click-and-collect service during the novel coronavirus outbreak, reported Supermarket News. In-store shopping isn’t available at the location, as store associates are focused on fulfilling online grocery pickup orders. • In a dining world now focused on takeout and delivery, some restaurants also have morphed into makeshift food marts, selling everything from groceries to hand sanitizer to even toilet paper, reported the Ocala Star Banner. • The fallout from the coronavirus spread could push nearly half a billion people into poverty, according to a new Oxfam study. The report outlines several scenarios, and under the most serious one—a 20 percent contraction in income—the number of people living in extreme poverty would rise by 434 million people to 922 million worldwide. • The sudcontinued on page 37

“If you have to shut down your store overnight to clean it, do it. If you have to shutter your store for a length of time out of protection for the people in your universe, or because you don’t have the staffing, do it.” continued from page 27

They awarded franchisees $5,000 in operational credits (for April only) to stay open 16 hours per day. For a full discussion of NCASEF’s response to this announcement, please take a look at Dispatch, “NCASEF Responds To SEI COVID Support Plan,” on page 10, or at www.NCASEF.com. On April 10 NCASEF sent an open letter to SEI (also in Dispatch, page 11) calling for the following actions until December 31, 2020: · Reduce the 7-Eleven charge by 30 percent · Suspend the advertising fee · Defer all loan payments that franchisees have with SEI · Reduce maintenance charges by 50 percent · Eliminate the credit card fees · Eliminate the interest fee · Lend funds to franchisees to stay above water, with 1 percent interest for 5 years for any under equity issues. As of this writing, we have not heard back from SEI. The NCASEF has hired a labor lawyer, Robert Bernstein, who we introduced at our convention last year, to consult with franchisees on how to handle employee issues as they come up. In the last two weeks he has conducted three webinars exclusively for 7Eleven franchisees, and participation has been great. You can find an article based on his presentation on page 45 of this issue. We are working closely with FOA presidents and vice presidents all over the country to help franchisees. Our general counsel Eric Karp has attended telemeet-

“The best advice I can give at this time is, don’t panic. First and foremost, take care of yourselves, and your families.”

ings with insurance companies, to update you, and his article appears on page 35. Our attorneys have already put together a template letter for franchisees who need to shut their stores down. There are franchisees who are worried about their safety and employee and customer safety. Some franchisees have boarded their stores out of concern for their workers and customers, or due to staffing issues. Some stores have closed at nighttime, largely to a lack of help. In some situations, where the virus is worst, all of franchisees’ employees have quit, and if a franchisee is a multiple storeowner, he or she has likely boarded stores. As it turns out, 7-Eleven is okay with this, but 7-Eleven wants franchisees to give proper notice 24 hours prior to closing and talk about the impact on their business. Bottom line, this brand is near and dear to all of us, but safety should be our first priority, because here we are, on the front lines of consumer service, fighting an invisible foe for franchisee safety, employee safety, and customer safety. We urge everyone to follow social distancing in your store, sanitizing the whole store, especially where customers touch the most (front door, counters). Encourage contactless payments. California’s health department has already issued the instructions on fountain, and most of us have already taken out the loose condiments according to the directions given to us by 7-Eleven, Inc. We appreciate whatever help is coming from 7-Eleven, but for franchisees already hindered financially, it is a deeper financial situation that has only become more acute as a result of changes made in the 2019 Franchise Agreement. We have weathered storms before, but this one is particularly tough, not only for us, but for everyone.

JAY SINGH CAN BE REACHED AT 702-249-3301 OR JAYS@NCASEF.COM

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Is SEI Sowing Discord In The Franchisee Community? BY MICHAEL JORGENSEN, EXECUTIVE VICE CHAIRMAN, NCASEF

The last year has been a particularly difficult one for franchisees. We now have a contract, the 2019 Agreement, where SEI has squeezed just about every nickel and dime that they can from us, and many franchisees felt coerced into signing it rather than give up their stores and and walk away from their livelihoods. We all supported a class-action lawsuit initiated by four franchisees against SEI just before the signing of the contract (it was a unanimous vote of the Board of Directors), because of the overwhelming control that SEI exercises over every aspect of the operation of the stores. While, on March 14, 2018, United States District Court Judge John F. Walter, in the Central District of California, Western Division, granted judgment on the lawsuit in 7-Eleven’s favor, that decision was soon overturned. On April 30, 2018, the California Supreme Court issued a landmark decision in the Dynamex case, and then the Ninth Circuit Court of Appeals vacated the district court decision and ruled the court should not have granted judgement for 7Eleven. Two months later the Ninth Circuit Court of California made a decision in the case of Vazquez vs. Jan-Pro Franchising, which strengthened the four franchisees’ case, and confirmed that the ABC test codified in Dynamex applies to franchisees. Over the course of this lawsuit, and the signing of the 2019 Franchise Agreement, franchisee leaders have been pulled in different directions—by SEI, by the National Coalition, by their own franchisees, and by the national publicity surrounding these events. You may have noticed that the officers of the NCASEF have chosen to speak out publicly about the lawsuit, about SEI’s business practices, about the difficulties

“You may have noticed that the

franchisees are having with the new officers of the NCASEF have agreement, about store level gross chosen to speak out publicly margin and profitability, and now, about SEI’s claims surrounding the about the lawsuit, about coronavirus support for franchisees. SEI’s business, about the Franchisee unity is a wonderful difficulties franchisees are thing when it happens, but it is a shifting, amorphous and fluid conhaving with the new agreement, cept that ebbs and flows with each and now, about SEI’s claims major event. I believe that SEI enjoys surrounding their coronavirus playing the field and manipulating franchisees in the process, and I besupport for franchisees.” lieve the company is fostering a split in the franchisee community. Some fran- NBLC, the CEO Roundtable, and ZLCs. chisees are responding because they are fear- Have you noticed that the NBLC (National ful of getting shut out and what might Business Leadership Council), which replaced the PLC (the President’s Leadership happen if they are. Council), is composed largely of franchisees who are not elected representatives of their FOAs? Prior to last year’s election when the 2019-2020 NBLC was announced, only five members of the NCASEF Board of Directors were selected out of 52 spots. After the NCASEF’s November election, when the NBLC expanded to 67 members, 11 additional Board members were added. The President’s Leadership Council from 15 years ago was comprised of all FOA presidents. Politics at its best. The National Coalition now is left to arSEI leadership has chosen to freeze out the National Coalition leadership and FOA ticulate the continuing problems with our leaders according to who supported whom system, and even though we are the only in our national elections, who supports the elected representatives of franchisees, SEI lawsuit and who doesn’t, and who speaks up has chosen to not have any such dialogue continued on page 32 for franchisee rights in meetings of the

“We have chosen to articulate our problems publicly and in the press because our repeated outreach to Dallas continues to be rebuffed.” AVANTI m a r c h | a p r i l 2 0 2 0

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Is SEI Sowing Discord with us at all, even after our repeated requests for open and honest discussion. We have chosen to articulate our problems publicly and in the press because our repeated outreach to Dallas continues to be rebuffed. SEI does have dialogue with some NCASEF Board members, but mostly with those who speak out against what we publicly articulate, so the message is clear—you are with us or you are against us.

“SEI has chosen to freeze out the National Coalition leadership and FOA leaders according to who voted for whom in our national elections, who supports the lawsuit and who doesn’t, and who speaks up for franchisee rights in meetings of the NBLC, the CEO Roundtable, and ZLCs.” SEI is making a concerted effort to create a division amongst franchisees and is further trying to create a wedge by forcing people further to one side or the other—there is no center. Franchisees need to be aware that their natural instincts for self-preservation compounds the problem, because unfortunately, many franchisees have two faces depending on the venue. The face presented to SEI will either denounce the National Coalition or be empathetic when confronted by SEI, while the other face, the one presented to FOAs or NCASEF leadership, will claim outrage at SEI’s actions, and full support of all measures being taken and programs implemented to assist franchisees. They will praise the National Coalition for what they know we are doing on their behalf.

continued from page 31

Remember, our full Board vote to support the misclassification lawsuit was unanimous. If everyone was honest, I believe we would be able to address the issues and move forward once and for all with a new culture and a new approach to addressing franchisee concerns. Honesty is the first step toward unity. SEI’s CEO constantly refers to the NBLC and CEO Roundtable as the way the company gets feedback from franchisees and solves problems. Yet corporate wants folks on these committees who generally agree with SEI’s strategies and don’t make too many waves in meetings. What NCASEF has wanted from the beginning is accountability and transparency, collaboration, and representation for the rights of franchisees. I hope all NBLC and CEO Roundtable members understand what an immense responsibility they have for representing franchisees—high volume, low volume, BCP, traditional, rural, urban, seasonal,

commuter, neighborhood, single-store and multi-store franchisees. Every franchisee participating on these committees is beholden to SEI for their position, which can be rescinded at any time. Why, you might ask, is SEI continuing to foster divisions in the franchisee community? They tell us, we have all of our protocols in place. We have our CEO Roundtable, our NBLC, our ZLC, and we don’t need you. Everything that gets accomplished gets accomplished because of these groups. The answer is that the most threatening thing ever for SEI would be to have a franchisee group that is fully woke, and fully united.

“Every move we make is to strengthen and protect franchisees and therefore, the brand.” 32

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It is easier and more towards their purposes to create an atmosphere where SEI controls the whole dialogue. The National Coalition is critical of the company when franchisees get a raw deal, and we want to impart this criticism to SEI not to harm the system, but to improve the system for ALL stakeholders. But with SEI, if you are critical, you risk getting frozen out. This is why it is crucial to have folks on these committees who are not nominated by SEI. The fact that SEI continues to call out the NBLC and the CEO Roundtable, and ignore the National Coalition, is a perfect example of how the company is using that to undermine elected franchisee representatives. Can the NBLC really give critical feedback? They tell us they have all the information they need, and they are right. They know all the issues, but don’t address them and instead play politics among the franchisees. National Coalition representatives don’t have a seat at the table, and they have closed every other channel for us to be constructively critical, so the only available avenue is through public statements. SEI says that is not good for the brand, but they are simply wrong. Every move we make is to strengthen and protect franchisees and therefore, the brand. This should be alarming to every franchisee. We should not be forced to take sides against each other. Every time you as a franchisee hear that the National Coalition is making waves and damaging the brand, remember the facts. We are the elected representatives of franchisees; we are not handpicked for political purposes or to control franchisees. We are always willing to speak openly about the issues and tackle those most important to franchisees regardless of their sensitivity. Foremost, we love this brand and we all do better when we all work together. It’s time for SEI to develop a new strategy.

MICHAEL JORGENSEN CAN BE REACHED AT

JORGENSEN.NCASEF@GMAIL.COM OR 347-251-1828


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COVID-19 PandemicRelated Insurance Coverages ERIC H. KARP, ESQ., GENERAL COUNSEL TO NCASEF

The COVID-19 pandemic has created a wide range of issues and challenges for franchisees. The National Coalition received a large number of questions from franchisees regarding whether their insurance coverage will help them as well as their employees in the context of the pandemic. In order to address those concerns, the Executive Team of the National Coalition facilitated a conference call regarding insurance coverages with John Barbot and Robin Partridge of Barbot Insurance, which operates principally in California and Nevada, and Ryan Fulton representing Aon, which provides coverages for a large number of franchisees in other parts of the country. As you are aware, franchisee who signed the so-called 2019 franchise agreement have taken on the responsibility for having their own insurance coverages, a significant departure from past practice. This is one of many costs which were transferred from SEI to the franchisee in that agreement. Under the 2019 franchise agreement, SEI is only responsible for fire and casualty loss to the store and the equipment, unless the loss is caused by the intentional acts of the franchisee or his or her employees. The franchisee is subject to broad indemnification obligations in favor of SEI and is required to name SEI as an additional insured under all required insurance policies. This latter obligation is one that franchisees should always comply with because it provides for the defense of

ERIC H. KARP CAN BE REACHED AT 617-423-7250 or ekarp@wkwrlaw.com

any claim brought against SEI as a result of the operation of “The National Coalition has received a the store. One Business Owners Policy we were provided large number of questions from franchisees with contains a separate doc- regarding whether their insurance ument entitled “Acknowledg- coverage will help them as well as their ment of Additional Insured Status-Grantor of Franchise employees in the context of the pandemic.” or License” and names “7franchisees that have their own insurance. Eleven, Inc. & All Wholly Owned SubExhibit C is very complex, it has 10 sepasidiaries & Divisions” as additional rate instances and circumstances under insureds. This is the proper way to comwhich the franchisee will not be indemply with that obligation. nified, and lists five additional categories of losses and obligations which are outside the scope of the contractual indemnification. For example, based on the 2016 franchise agreement, starting at page F-39: ● General liability coverage up to a maximum of $500,000. ● The indemnification does cover a burglary (a theft of inventory when the store “Franchisees who signed is closed), as well as a robbery (theft in the the so-called 2019 franstore or while on the way to the bank). ● For a robbery while the store is open, chise agreement have SEI pays up to $500 for inventory. taken on the responsibil● For a burglary while the store is closed, ity for having their own SEI pays full replacement cost less $100 for inventory other than tobacco. For toinsurance coverages, a bacco, there is a complicated formula significant departure based on the lesser of replacement cost from past practice.” and historical purchases over the most recent 12 weeks, in both cases, less $100. If you did not sign the 2019 franchise The balance of this article is a sumagreement, and your location is operated mary of what we learned from insurance under an older agreement, you are subject professionals for franchisees who have to the indemnification provisions found their own insurance pursuant to the 2019 in Exhibit C to the franchise agreement. franchise agreement. The specific coverThe amounts that SEI pays pursuant ages and the amount of coverage required to those indemnification provisions are are listed in section 18 of the franchise very different than what is available to continued on page 36 AVANTI m a r c h | a p r i l 2 0 2 0

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COVID-19 Pandemic-Related Insurance Coverages continued from page 35

agreement and are beyond the scope of this article. This summary should not be considered legal advice and there is no substitute for a franchisee having direct contact with his or her insurance agent or broker with respect to any questions that relate to a specific location.

Business Interruption Insurance Business interruption insurance may not be helpful to franchisees for two separate reasons. First, business interruption insurance generally requires physical injury to property in order to generate a valid claim. At least one insurance company, with which we have been in contact on behalf of a franchisee in another franchise system, has taken the position that a virus does not create physical injury to property, and thus there is no coverage on

that basis alone. Second, these coverages have an industry-standard exclusion for viruses that create illness or disease. It turns out that to our knowledge, no one in the insurance marketplace offers virus coverage within their Business Owners Policy form. There was one insurance company that offered a plan that covered viruses, but the pre-

mium was 2 percent of gross sales and there were essentially no takers. The insurance professionals believe that at some point in the future virus coverage might be available, but only if the government steps in and subsidizes or backstops the coverage in the same way it did with respect to terrorism coverage.

Workers’ Compensation

“If you did not sign the 2019 franchise agreement, and your location is operated under an older agreement, you are subject to the indemnification provisions found in Exhibit C to the franchise agreement.�

There is no exclusion for coverage for an employee that alleges that they contracted the COVID-19 virus in their employment workplace. This would apply whether they allegedly contracted the virus by interacting with another employee, or a customer, or came in contact with an infected hard surface in the store. However, the standard of proof necessary continued next page


continued from page 29

den surge of people working from home during the coronavirus pandemic spurred sales of laptops, webcams, keyboards and other equipment at Best Buy, reported the Star Tribune. Sales of refrigerators and freezers rose as well, as more consumers stockpiled food. • In order to protect its customers and employees during the COVID-19 pandemic, grocery chain Hy-Vee instituted a “one person per cart” policy at all of its locations, reported KY3.com. Hy-Vee said by reducing how many family members accompany a customer on shopping visits, it could help slow the spread of the coronavirus. • In early April, major supermarket chains started to report their first coronavirus-related employee deaths, continued on page 38

“Business interruption insurance may not be helpful to franchisees because business interruption insurance generally requires physical injury to property in order to generate a valid claim, and these coverages have an industry-standard exclusion for viruses that create illness or disease.” continued from previous page

to demonstrate a causal connection between the virus and the place of employment would present a steep challenge to any employee that made such a claim. As with this and other coverages, the insurance professionals indicated that all insurance companies are being very cautious about making any statements regarding coverages related to virus because they expect an onslaught of claims. Therefore, there is little to be lost by making a claim because the employee may succeed, and

it is even possible that there may be government intervention making it easier for employees to make these claims.

Property And Casualty As with workers’ compensation, there is no specific exclusion for claims arising from a virus. There was an extended discussion about whether or not coverages for inventory arising from robberies, burglaries, riots or civil unrest, or fire and casucontinued on page 38


COVID-19 Pandemic-Related Insurance Coverages continued from page 37

alty would be affected while the store is closed. The insurance professionals advised that all of these coverages would remain in effect whether the store is open or closed and irrespective of the reason the store closed. They also stated that under the insurance policies, the franchisees have an obligation to take reasonable steps to preserve and not abandon the property that is the subject of the insurance. This means making sure that if the store’s closed, the front door is securely locked and that high-value items such as cartons of cigarettes and lottery tickets are placed out of public view and locked away in the

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office. When a claim is made, it is often very difficult to prove how many cartons of cigarettes were in store at the time of the robbery. Deposit all cash in the bank before the store is closed. Take the cash drawers out of the registers and place them upside down on the counters. SEI has issued a 20 step COVID-19 Closure Checklist for use in these situations. We were also advised that when a franchisee closes the store, Asset Protection steps up its video monitoring.

“There is no exclusion for coverage for an employee that alleges they contracted the COVID-19 General Liability Claims virus in their employment There was a general discussion of whether or not a franchisee would have workplace. However, the coverage for claims asserted by a cusstandard of proof neces- tomer that he or she contracted the virus within the store. While there is no sary to demonstrate a specific exclusion for claims of a cuscausal connection betomer based on contracting a virus, the tween the virus and the standard of proof, like that in the workers’ compensation context, would make place of employment such claims very difficult to prove. In would present a steep the event that such a claim is asserted challenge to any employee against the franchisee, or threatened against the franchisee, the claim should that made such a claim.” immediately be tendered to the insurance company.

CONTACT INFORMATION Here is the contact information for the insurance professionals that we consulted: John Barbot Robin Partridge Barbot Insurance Services Toll Free: 888-505-7110 Phone: 619-337-0290 jcbarbot@barbotins.com

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Ryan Fulton Account Executive Practice Leader Aon Risk Solutions Phone: 214-989-2560 Cell: 214-763-8064 ryan.fulton@aon.com

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Tonya Renee Rosales Sr. Account Specialist Aon Risk Solutions 5005 LBJ Freeway, Suite 1400 Dallas, Texas 75244 Phone: 214-989-2349 Toll Free: 800-527-9034 Cell: 972-757-3322 renee.leffall@aon.com

leading to store closures and increasing anxiety among grocery workers as the pandemic intensified across the country, reported the Washington Post. • DoorDash recently announced that it has partnered with regional and national convenience stores across the U.S.—including 7-Eleven, Wawa, Casey’s General Store, and CircleK—to offer customers essential food items and household products on demand, delivered straight to their doorstep through a no-contact drop-off option. • Americans spent $44.9 billion on drunk purchases in the past 12 months, according to Finder’s latest Drunk Shopping survey. Nearly a quarter (22.9 percent) of Americans admit to shopping under the influence. The average drunk shopper is spending an average of $768.58 on drunk purchases this year, compared to $674.96 in 2019. • During the early days of the coronavirus outbreak in the U.S., the Department of Justice warned against companies or individuals price gouging or rigging bids for any equipment that customers might use against the virus, such as gloves, face masks and respirators, reported The Hill. • CVS Health created its first drive-up coronavirus testing center in Shrewsbury, Mass., in mid-March to exclusively serve nurses, police, firefighters and other first responders, reported CNBC. The retailer joined Walmart, Target and Walgreens in pledging to put testing facilities in their parking lots. • During the early weeks of the coronavirus outbreak in the U.S., the Federal Motor Carrier Safety Administration mandated that truck drivers moving goods in support of emergency relief efforts would not have to follow the hours-of-service laws, which regulate how many hours a truck driver may work, reported Business Insider. This was the first time since 1938, when the rule was developed, that it’s been suspended on a national level. • Walgreens used its pharmacy drive-thru windows to sell select groceries at more than 7,300 locations continued on page 55


Legal Guest Column

COVID-19 IN NEW YORK— THE UNIMAGINABLE By Arnold Hauptman, General Counsel, UFOLI New York As if 7-Eleven franchisees did not be interpreted as an have enough financial problems, along abandonment, recomes the coronavirus (COVID-19), sulting in a termiwhich blanketed our county with New nation. At a time York City and its surrounding suburbs when most franbeing the U.S. epicenter of the pandemic chisees are scratchas of this writing. To put things in perspec- ing for every nickel tive, almost 1,000 people died from the of income, a termivirus in New York state on April 10, with nation or even the total deaths in the state exceeding those threat of a terminalost on 9/11. Unimaginable. tion would be a In mid-March, things began to move disaster. very rapidly with conflicting reports and Under the advice about the severity of the virus from leadership of Grand Central Station, New York City—March 26, 2020 both federal and state agencies, as well as Yousaf Naseer, from 7-Eleven with respect as to how to UFOLINY presihelp. But it is also true that matters were handle the impending crisis. It soon be- dent, and the UFOLINY Board of Direcvery much in flux at the time of his recame obvious that franchisees had to make tors, correspondence was initiated with our sponse, and it is understandable that hard quick decisions, and some still have to in zone leader, Sembe Cole, asking pointed answers to hard questions had not yet been the immediate future. Do I and direct questions including: formulated by SEI. close my store during the “Almost 1,000 what financial assistance could In response to the concerns of a frannight hours because of short people died SEI provide to store owners chisee who felt that he needed to close his staffing, or do I stay open? Is from the virus hard hit by a loss of sales and store and was concerned about a possible the health and safety of my profit? What about the prob- termination if he did so, I advised Yousaf in New York employees, my family, and lem of staff shortages and that I did not believe any judge would apeven me more or less im- state on a mandatory closings? Will de- prove a termination based upon a store single day, portant than serving our liveries continue relatively un- closure resulting from the virus. This was customers? Should my loy- April 10, with abated? Mr. Cole, at that early an act of God, out of the control of both alty to the 7-Eleven brand total deaths stage of the pandemic, re- the franchisee and SEI. trump (pardon the pun) the in very general and On March 26, when it was becoming in the state ex- sponded concerns for the very safety noncommittal terms, stating clear that several owners wanted to either and lives of my staff? Fi- ceeding those that franchisees are independ- shorten hours or close their stores entirely, nally, do I close my store en- lost on 9/11. ent owners, and it is up to them I gave the following general device to tirely and worry about the Unimaginable.” to staff stores through what- Yousaf which was passed on to all legal ramifications of such ever resources are available. He UFOLNY members: closing some other time? All very weighty further stated that the issue of financial recontinued on page 42 questions. lief will be determined At this time, there was absolutely no based upon individual “Should my loyalty to the 7-Eleven brand guidance from SEI with respect to the risk store circumstances trump the concerns for the very safety and of being served with a material breach if a and the impact of the lives of my staff? Do I close my store enstore were to close or even shorten hours. virus to a particular tirely and worry about the legal ramificaAfter all, the store agreements all provide for store. Not very comtions of such closing some other time?” 24/7 operation and a failure to do so could forting and not much AVANTI m a r c h | a p r i l 2 0 2 0

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“I continue to take the posi- “An email from Michael Coffman, Esq., tal loans via the stimulus tion that paragraph 31(c) of the package. Another good sign my SEI counterpart, reiterated that it is 2004 agreement (and I believe all that SEI cares about its franversions in between) fully provide the ultimate decision of the individual chisees during this crisis. But for the coronavirus pandemic to will it be enough to save our store owner as to whether or not to come within the purview of the franchisees from financial language of the section which es- close the store or reduce hours, asking ruin? sentially provides that neither only that SEI would like the franchisee At the time this article is party will be liable in damages to being written (around April the other for any failure or delay to speak to management to discuss 11), the virus continues unin performance due to any… gov- the impact of such a decision.” abated with an unimaginable ernmental act or regulation… death toll through the U.S. It other disaster or event beyond your or our port for every store and, very importantly, is no wonder that scores of our members, as control provided each notifies the other of made clear that no penalties (i.e., material well as owners in other markets, have taken such failure or delay, and takes all steps to breach or termination notices) would be the high road to safety and have closed their mitigate the failure or delay. Undoubtedly imposed if the store was to temporarily stores until it is safe to reopen. New York this is a situation out of the control of both close or reduce hours. At the very least this City stores were particularly hard hit, and I parties. This provision is often called ‘force was a good start and an indication that believe most stores have closed. perhaps finally SEI had the backs of its majeure’ which means unforeseeable circumstances that prevent someone from franchisees. We shall see. “Joe DiPinto’s letter to Several days later, I received an unsofulfilling a contract. franchisees recognized the “In my view, any franchisee who de- licited email from Michael Coffman, Esq., financial pressure on store termines to close his or her store because my SEI counterpart, reiterating that it is the owners, announced a prelimof safety or staffing concerns can do so ultimate decision of the individual store inary actual dollar support without risk of a breach, as long as he/she owner as to whether or not to close the store or reduce hours, asking only that SEI would for every store, and very notifies SEI at least 24 hours before closing (if possible) and takes reasonable steps to like the franchisee to speak to management importantly, made clear that to discuss the impact of such a decision. For secure the store premises.” no penalties (i.e., material Shortly thereafter, on March 27, as sure, the independent thinking and decision breach or termination conditions worsened and more and more making of franchisees in this situation was notices) would be imposed if franchisees were either closing stores or coming into focus. the store was to temporarily Only a short time ago, SEI announced closing at night, a rather comforting letter close or reduce hours.” from SEI president, Joe DiPinto, was sent a commitment of close to $100 million in financial support of its franchisees. That to franchisees. That letter recognized the financial pressure on store owners, an- money, as I understand it, will provide diThis pandemic is a disaster of historic nounced a preliminary actual dollar sup- rect credits to boost cash flow in March proportions, and no one knows how it will and April and perend—but it will end. Hopefully, very hopehaps thereafter, and fully, by the time you read this article, the will enable the waiv- curve will have come down and sooner or ing of April advertis- later, we can all go back to business as ing fees, as well as usual. There is often a silver lining when waiving interest on a disaster strikes, and there may be one here. store’s inventory. Can this silver lining be the resumption of Moreover, SEI has communication and cooperation between set up a system to 7-Eleven, Inc. and its franchisees? provide financial ad- Unimaginable? Perhaps not. vice and to guide Stay safe everyone. franchisees through ARNOLD HAUPTMAN the process of obCAN BE REACHED AT taining governmenWall Street, New York City—March 21, 2020 AJHAUPTMAN@AOL.COM OR (516) 541-7200 42

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Legal Guest Column

NAVIGATING THE COVID-19 PANDEMIC: NCASEF Educational Webinars For Franchisees By Rob Bernstein, Esq., Partner, Laner Muchin, Ltd. The COVID-19 pandemic has had a farreaching impact on businesses throughout the United States. Employers are grappling with how to best respond to this pandemic in a way that makes sense from health, safety, and business standpoints. On March 31, April 2 and April 7, 2020, as NCASEF’s Labor and Employment attorney, I conducted webinars covering a number of important topics for franchisees, including compliance with the newly enacted Families First Coronavirus Response Act (FFCRA), as well as best practices for responding to COVID-19 employment-related issues. Franchisees had the opportunity to have their questions related to these important topics answered as well. Those in attendance asked many excellent questions, which added to the discussion. Some of the high points covered in the webinars were:

FFCRA Effective Date/Coverage The FFCRA went into effect on April 1, 2020 and its requirements will expire on December 31, 2020. The FFCRA applies to private sector employers with fewer than 500 employees, which is the vast majority of our franchisee population.

Key Requirements/ Provisions Of The FFCRA • All employees are eligible for up to two weeks of paid or partially paid leave (depending on the Qualifying Reason for the leave) for certain COVID-19 related matters (this is known as Emergency Paid Sick Leave). • The Family and Medical Leave Act was expanded to provide partially paid leave to employees who must remain home to care for their sick child, if the child’s school or other place of care has been closed, or the child care provider is unavailable due to a COVID-19 related emergency as declared by the federal, state or local government (this is known as Expanded Family Medical Leave). • Tax credits equal to 100 percent of the

FFCRA-mandated paid leave wages paid by an employer each calendar quarter, subject to certain caps. • Greater access to unemployment insurance for employees who are off work for certain reasons related to COVID19. It is important for franchisees to understand their state’s approach toward unemployment benefits.

Employee Request And Employer Response Forms Franchisees must keep careful records of all documentation as it re- “We conducted webinars covering a lates to each employee’s leave request number of important topics for franunder the FFCRA. After the webinars, we created Employee Request and chisees, including compliance with the Employer Response Forms for fran- newly enacted Families First Coronchisees to utilize in connection with avirus Response Act (FFCRA), as well employee requests for leave under the as best practices for responding to FFCRA (these have now been sent out COVID-19 employment-related issues.” to all franchisees). In addition to utilizing these forms, I emphasized the rate employee files (and if the form and/or supneed for franchisees to request that their emporting documentation contain medical inforployees provide supporting documentation mation, in separate confidential medical files). for their FFCRA leave requests. Additionally, franchisees must keep docI further emphasized the importance for umentation to show how they determined the franchisees to keep copies of the completed amount of Emergency Paid Sick Leave and/or Employee Request and Employer Response Expanded Family Medical Leave wages paid to Forms and the supporting documentation for employees eligible for the tax credit; documeneach employee FFCRA tation to show how the franchisee determined leave request in sepathe amount of qualified health plan expenses allocated to wages paid (if applicable to the franchisee) in connection with FFCRA leave requests; and copies of any completed quarterly federal employment tax returns (e.g., Forms 941) and Form 7200 (Advance of Employer Credits Due to COVID-19), and any other filings that the franchisee submitted to the IRS requesting credit. In order to receive the tax credits for the wages they pay for their employees’ leaves under the FFCRA, franchisees must keep all of the previously mentioned documents and records for at least four years after the taxes become due. continued on page 46

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Small Business Exemption Given that many 7-Eleven franchisees have fewer than 50 employees, we spent a good amount of time discussing the small business exemption under the FFCRA. Franchisees with fewer than 50 employees can declare this exemption with respect to leaves related to child care due to school or child care provider closures or unavailability due to COVID-19 (Qualifying Reason No. 5 only) when the imposition of the FFCRA requirements in this regard would jeopardize the viability of the franchisee’s business as a going concern. A franchisee does not apply for the exemption with the government, but rather declares the exemption by way of the franchisee’s owner or authorized member of management internally documenting in detail which one of the three necessary conditions for claiming the exemption under the Department of Labor’s regulations that the franchisee meets. Franchisees can go to the FFCRA Questions and Answers and/or the Temporary FFCRA Regulations issued by the DOL at www.dol.gov to read more about the details of these three conditions. The exemption is claimed on an employee-by-employee basis and does not necessarily exempt the franchisee from providing paid leave with respect to Qualifying Reason No. 5 (child care reasons) for all employees. The franchisee must document the facts and circumstances that meet the criteria for each denial of an employee’s FFCRA leave request based on this exemption and keep such records for at least four years. I emphasized that this small business exemption only applies to Qualifying Reason No. 5 (child care reasons) and that a franchisee must still provide Emergency Paid Sick Leave for Qualifying Reason Nos. 1 through 4 and 6, even if exempt from doing so for Qualifying Reason No. 5.

Required FFCRA Poster Franchisees must post the required FFCRA Poster in English and Spanish in a place in each of their stores where they can be easily seen by their employees. Franchisees can go to the Department of Labor’s website at www.dol.gov to get copies of this poster in English and Spanish. To the extent that an employee will not have an opportunity to see the poster because the employee is on a leave of absence or will otherwise be away from the 46

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franchisee’s store for an extended period of time (for reasons other than a furlough or layoff), the franchisee should email or mail the poster to the employee.

Do’s And Don’ts Regarding COVID19 Employment-Related Issues I covered some important Do’s and Don’ts for our franchisees as they are operating their day-to-day businesses. Franchisees have the right to: 1) ask employees if they have a fever, cough, shortness of breath or other symptoms of COVID-19; 2) require employees to inform them if they have been diagnosed with COVID-19, exposed to

“The FFCRA applies to private sector employers with fewer than 500 employees, which is the vast majority of the 7-Eleven franchisee population.”

a person diagnosed with COVID-19, or have traveled to an area with an outbreak of COVID-19; 3) require employees to inform them of out-of-state travel plans; and 4) encourage employees to go to a health care provider to be tested for COVID-19. Franchisees also have the right to send an employee home from work and prohibit the employee from working if the employee exhibits symptoms of COVID-19 or is diagnosed with COVID-19. Keep in mind that the current Centers for Disease Control and Prevention (CDC) Guidance provides that an employee deemed to be a critical infrastructure worker (employees supporting convenience stores are critical infrastructure workers) or an essential worker under the franchisee’s relevant state of operation may continue to work if they are exposed to a person with COVID-19 so long as the employee is not experiencing any symptoms of COVID-19 and so long as the following additional precautions are taken:

• Pre-Screening: Franchisees measure the employee’s temperature and assess symptoms prior to the employee starting work. The CDC further recommends that this occur before the employee enters the store. • Self-Monitoring: The employee should selfmonitor for the development of COVID-19 symptoms. • Wear a Mask: The employee should wear a facemask while in the workplace for 14 days after the last exposure (franchisees should monitor their state, city and local laws and ordinances regarding the wearing of masks as well). • Social Distancing: The employee should maintain 6 feet of distance from others in the workplace to the extent work duties permit. • Disinfect and Clean Workspaces: Franchisees should take steps to ensure that all areas of their stores are routinely cleaned and disinfected, including bathrooms and any common areas. Franchisees should carefully consider whether the CDC’s previously mentioned updated Guidance can be practically implemented in their stores, or whether there is another approach that responsibly addresses health and safety issues that is a better fit for their stores. Franchisees further have the right to: 1) prohibit employees who have experienced symptoms of COVID-19 from returning to work until 72 hours after the employee has recovered—defined as resolution of fever without the use of fever-reducing medicine and improvement of respiratory symptoms (e.g., cough or shortness of breath), and at least 7 days have passed since the employee’s symptoms first appeared; and 2) prohibit employees who have been diagnosed with COVID-19 from returning to work until the employees have been cleared to work by a health care provider. Franchisees can and should: 1) inform employees who have had prolonged contact with an employee or customer who has been diagnosed with COVID-19 (e.g., being within approximately 6 feet of the employee or customer for approximately 10 minutes or more) that there is a risk they have been exposed to COVID-19 in the workplace; 2) maintain confidentiality as to the person who may have exposed them (do not disclose the person’s name continued next page


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or any other identifying information about the person); 3) encourage the employees who may have been exposed to self-monitor whether they experience any symptoms of COVID-19; 4) consider increasing cleaning measures in the store to stop the spread; and 5) consider whether to notify the State or local Department of Public Health depending on the seriousness of the situation. Franchisees should not: 1) discriminate or retaliate against, or harass an employee for COVID-19 related reasons or for seeking benefits under the FFCRA; 2) make medical inquiries of disabled employees to determine whether they have a compromised immune system or have other medical conditions that may make them more susceptible to contracting COVID-19; and 3) require employees to get a flu shot or require them to submit to medical testing if they have no symptoms and are not at high risk.

Webinar Questions Franchisees asked many excellent ques-

tions in the webinars regarding many of the issues addressed in this article, such as the different Qualifying Reasons for leave under the FFCRA, the type of notice and documentation employees need to provide in support of their FFCRA leaves, posting requirements, the small business exemption, and circumstances under which employees can receive unemployment benefits. While we answered many of these questions in the webinars, we will be drafting a Frequently Asked Questions document that franchisees can have as a further resource as they navigate the FFCRA and related issues. Additionally, to provide additional resources to 7-Eleven franchisees, NCASEF has entered into a partnership with Laner Muchin, which provides that our legal team will be available to answer all franchisees’ labor and employment, employee benefits, and immigration questions. Franchisees are encouraged to contact us with questions regarding day-to-day operations and any situations that might arise.

Dark Chocolate Peanut Butter McLane UIN 321337

Honey Sea Salt McLane UIN 321347

Rob Bernstein joined Laner Muchin in 1995 and has been a partner since 2003. His practice has been concentrated in defending employers in employment disputes and proceedings throughout the country, counseling employers on their day-to-day labor and employment issues, training management on a host of labor and employment topics, drafting and negotiating employment and non-competition agreements, drafting employee handbooks and corporate policy manuals, as well as handling collective bargaining negotiations, arbitrations, and a variety of other labor and employment matters on behalf of employers. PRACTICE AREAS Labor Management Relations Private & Public Sector Employment Litigation

CONTACT Rob Bernstein 515 North State Street Suite 2800 Chicago, IL 60654 312.467.9800 rbernstein@lanermuchin.com

Laner Muchin Ltd. concentrates exclusively in the representation of employers in labor relations, employment litigation, employee benefits and business immigration matters. The firm provides legal services to clients from coast to coast. For more information visit www.lanermuchin.com.


Franchisee Guest Column

7-ELEVEN FRANCHISEE MISCLASSIFICATION CASE: UPDATE ON AB 5 By Jaspreet Dhillon, NCASEF Treasurer, President, Franchise Owners Association of Greater Los Angeles California lawmakers passed bill AB 5, Worker Status: Employees and Independent Contractors, on September 11, 2019. Governor Gavin Newsom signed the bill into law on September 18, 2019, and it went into effect in California on January 1, 2020. It affects employers who have independent contractors performing work in California, but it is also incredibly significant to National Coalition members because it directly affects the ongoing misclassification (i.e. independent contractor) lawsuit four franchisees brought against 7-Eleven in 2017. The misclassification lawsuit, Serge Haitayan, et al vs. 7-Eleven, Inc. was filed in October of 2017, alleging the company misclassified franchise owners in California as independent contractors instead of employees. The franchisees asserted that the pervasive controls that 7-Eleven, Inc. exercises over almost every single aspect of the day-to-day operations of their

Supreme Court issued a landmark decision in the matter of Dynamex Operations West, Inc. vs. Superior Court of Los Angeles. In a voluminous 82-page decision, the California Supreme Court reinterpreted and ultimately rejected the Borello test for determining how workers should be classified under the California wage orders. Borello was replaced in favor of a worker-friendly “ABC test.” The ABC test is a three-step test that determines whether an individual is an independent contractor or an employee. Under the test, a worker is considered an employee unless each of three requirements are met in order to classify the worker as an independent contractor: 1. The worker is free from the control of the hirer in connec-

“ab 5 is incredibly significant to national coalition members because it directly affects the ongoing misclassification lawsuit four franchisees brought against 7-eleven in 2017.” stores makes all franchisees employees, not independent contractors in the eyes of the law. On March 14, 2018, United States District Court Judge John F. Walter, in the Central District of California, Western Division, granted judgment in 7-Eleven’s favor. All was not lost, however, when on Monday, April 30, 2018, the California

tion with the performance of the work, both under the contract for the performance of such work and in fact. 2. The worker performs work that is outside the usual course of the hiring entity’s business. 3. The worker is customarily engaged in an independently established trade, occupation or business of the same nature as the work performed for the hiring entity.

“On Monday, April 30, 2018, the California Supreme Court issued a landmark decision in the matter of Dynamex Operations West, Inc. vs. Superior Court of Los Angeles, which reinterpreted and ultimately rejected the Borello test in favor of the worker-friendly ABC test.” On February 27, 2019 the Ninth Circuit Court of Appeals, in the 7-Eleven franchisees’ case, vacated the district court decision and ruled the the court should not have granted judgment in 7Eleven’s favor. Their case was sent back to the District Court in Los Angeles, where they are represented by Shannon Liss-Riordan of Lichten & Liss-Riordan, P.C. in Boston. She is widely recognized as one of the country’s top class action employment lawyers, and she has chalked up victories against big-name corporations such as Starbucks, FedEx and American Airlines. But that was not all. On May 2, 2019, the Ninth Circuit Court of California made a decision in the case of Vazquez vs. Jan-Pro Franchising, in which the plaintiffs were individual janitorial employees who claimed that Jan-Pro, a major international franchisor of janitorial cleaning businesses, had developed a sophisticated three-tier franchising model to avoid paying them minimum wages and overtime pay by continued on page 50

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misclassifying them “On May 2, 2019, the Ninth Circuit Court of as independent conCalifornia made a decision in the case of tractors. The case, a Vazquez vs. Jan-Pro Franchising, in which putative class action, individual janitorial employees claimed that had wound its way in Jan-Pro, a major international franchisor the Northern District of janitorial cleaning businesses, had develof California after oped a sophisticated three-tier franchising more than ten years of litigation, but now, model to avoid paying them minimum after the Dynamex wages and overtime pay by misclassifying decision, the Ninth them as independent contractors” Circuit found that franchisors could be considered employers under the ABC test. The Jan-Pro decision strengthened the case of the four franchisees and confirmed that the ABC test applies to franchisees.

Genesis Of AB 5 AB 5 grew out of the 2018 California Supreme Court decision in Dynamex, which announced a new standard for classifying workers as employees. Essentially, Bill AB 5 codifies the Dynamex decision. Once AB 5 is put into practice, many workers once classified as independent contractors will be eligible for a variety of employee and unemployment benefits. An article on the website of Paylocity, a large American provider of cloud-based payroll and human capital management software, based in Illinois, says these changes could include: • Social Security and Medicare withholding, including the employer portion of each • Minimum wage and overtime requirements

“Once ab 5 is put into practice, many workers once classified as independent contractors will be eligible for a variety of employee and unemployment benefits.” 50

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trol and direction in connection with the performance of the service, both under his contract for the performance of service and in fact; and B) The service is performed outside the usual course of the business of the employer; and, C) The individual is customarily engaged in an independently established trade, occupation, profession or business of the same nature as that involved in the service performed. As AB 5 progresses from bill to application of the bill in real life, it is not without its detractors. For example, measures in the California State Assembly to weaken AB 5 include —AB 1928, an effort to Repeal AB 5 —AB 1925, an exemption for small businesses

“measures in the california State assembly to weaken ab 5 include, among others, ab 2489, an exemption for franchising, and in the california State Senate, Sb 967, an exemption for franchising.” • Protections under FLSA and state wage and hour laws • Affordable Care Act (Obamacare) offer of coverage • State unemployment tax contributions • Workers’ compensation • State and local paid sick leave • Paid family leave requirements • Statutory Disability Insurance AB 5 codified the Dynamex decision and includes exemptions for many professions, including doctors, dentists, insurance agents, accountants, engineers and travel agents. Essentially, California Assembly Bill 5 sets a standard for determining an independent contractor by adopting the ABC test. The test has its origins in Massachusetts General Law, Part 1, Title XXI, Chapter 149, Section 148B, which states: A) The individual is free from con-

—AB 2489, an exemption for franchising In the California State Senate, groups are seeking exemptions for their various constituents: —SB 875, an exemption for interpreters and translators —SB 867, an exemption for newspaper distributors or carriers —SB 868, an exemption for freelance journalists —SB 967, an exemption for franchising

“California franchisees, FOAs and the National Coalition have all been busy supporting AB 5 and the four franchisees’ lawsuit throughout this time.” continued next page


Franchisee Guest Column continued from previous page

extensive set of “In early March we marshaled the strength talking points for of the National Coalition and California franchisees to use California franchisees, FOAs and 7-Eleven Franchise Owners Associations by when speaking to the National Coalition have all been busy asking every FOA president in California to their legislators. supporting AB 5 and the four fransign a position letter in opposition to —On March 2, chisees’ lawsuit throughout this time: California AB 1928, AB 2489 and SB 967, 2020, at our urg—On February 19, 2020, at our urging, which would repeal AB 5 and/or grants exing, AAFD sent a three California state senators signed emption to franchising from AB 5. All FOA letter to California and sent a letter to Commissioner Senator Andreas presidents signed the letters except two.” Manual P. Alvarez, at the California Borgeas urging Department of Business Oversight, opposition to SB 967, Worker Status: In- withdrawing his support unless the bill asking for a response from the Departdependent Contractors: Franchiser and is changed considerably to protect franment’s Enforcement Division to Franchisees. This bill, if passed, would chisees. NCASEF General Counsel Eric Karp’s As 7-Eleven franchisees, our sales create an exemption for franchisees 2018 letter questioning 7-Eleven Inc.’s are going up, but our income is going from AB 5. In his letter, the chairman of long-term franchising strategy. AAFD explains that, “franchisees need down, resulting in an unfair split. In —On February 25, 2020, we secured the to be owners of their businesses…in our comparing 2018 vs. 2019 financials, few support of Robert Purvin, Chairman opinion, not all franchises have a fran- franchisees have a higher bottom line. and CEO, and the American Associachisor/franchisee relationship that qual- We believe that SEI is making a lot of tion of Franchises and Dealers, the oldifies for containing the basic tenets of changes, and making more money from est and largest national not-for-profit vendors and franchisees, but that franbusiness ownership.” trade association advocating for the rights and interests of franchisees and —In early March we marshaled the chisees are eating the costs. AB 5 was created to protect workers, strength of the National Coalition and independent dealer networks. Purvin California 7-Eleven Franchise Owners including franchisees, and SEI is workand the AAFD are urging opposition to Associations by asking ing to take it away. As one of my fellow the International Franevery FOA president in plaintiffs said at a recent advocacy meetchise Association’s sup- “We secured the California to sign a posi- ing, “Franchisees are not against the port for a blanket support for tion letter in opposition to brand. If you cannot support AB 5, exemption for franab 5 from the California AB 1928, AB please don’t go against it. SEI fails the chisors from the applica2489 and SB 967, which ABC test, because franchisors run the tion of AB 5. american would repeal AB 5 and/or same businesses as franchisees. SEI says —On February 26, 27 and association of grants exemption to Fran- they do not run c-stores, but the fact is March 5 we held three Franchises and chising from AB 5. All otherwise.” special meetings sponsored by the 7-Eleven Dealers, the old- FOA presidents signed FIND YOUR the letters except two. franchisee Advocacy est and largest LEGISLATOR As a result of our efGroup in California on California franchisees can find their national notforts on SB 967 (an exAB 5 and the misclassifilegislators at the website Profranemption for franchisees), chisee.com. We urge you all to email cation lawsuit, one in for-profit trade two Republican State Sen- your representatives your opinion. If Sylmar, one in Diamond association ators have changed their you need a copy of Eric Karp’s talking Bar, and another in San advocating for views. Lin Ling Chang points on AB 5, please email me at Diego. We urged all Calwithdrew her support be- jaspakam@gmail.com or call me at ifornia franchisees to call the rights and fore the bill was intro- (310) 892-2106. their legislators to take interests of duced, and Vice Chair of their names off all bills franchisees and the Senate Labor ComJASPREET DHILLON opposed to AB 5. CAN BE REACHED AT mittee, Mike Morrell, is —NCASEF legal counsel independent jaspakam@gmail.com or (310) 892-2106 considering Eric Karp developed an dealer networks.” currently

7-Eleven Franchisee Efforts To Support AB 5

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Vendor Guest Column

EMERGENCY PLANNING AND PANDEMIC RESPONSE FOR YOUR EMPLOYEES AND CUSTOMERS John Harp, CSP, ARM—Risk Engineering Consultant, MSIG Insurance Group At this time, the COVID-19 pandemic should be winding down and we are hopefully getting closer to our previous way of life. With this event, the experts agree there will be a new normal when it comes to infection control, sanitation, and expectations of proper precautions from the places we visit and work. In managing this epidemic or any emerging situation like natural disasters, shootings or future outbreaks, it reminds us that as business owners it is important to have an emergency plan and educate employees.

Workers’ Compensation And Osha Considerations Question: If an employee contracted COVID-19 or other infectious disease, will they be covered by Workers’ Compensation? The answer is complicated. Although workers’ compensation statutes and case law can vary by state, compensability generally requires that an illness or disease be “occupational.” This means that the illness:

meaning that the disease is found exclusively among or presents a greater risk for certain employees. In the case of COVID-19, first responders and workers in the health care, transportation, and retail industries are among those with a higher likelihood of exposure. As COVID-19 spreads, it becomes increasingly difficult to determine whether an employee has contracted the illness in the workplace. Health care workers, for example, who are infected through contact with patients could expose not only their coworkers, but their families, neighbors, and strangers, too. Whether a specific case is compensable will be determined by the facts established during an investigation of the claim, as well as the governing law in the jurisdiction where the claim is reported. And because there is no single “test” that can prove whether an illness or disease is compensable, it may ultimately come down to a decision by a court or state workers’ compensation board. Let your insurance claims staff guide you! Question: Are there OSHA re-

“If an employee contracted COVID-19 or other infectious disease, will they be covered by Workers’ Compensation? For now, the answer is complicated.” ● Arises out of and occurs in the course and scope of employment, which will normally come down to whether an employee was benefitting the employer when exposed. ● Is proven to be the result of workplace exposure. ● Is “peculiar” to the employee’s work,

quirements for pandemic response and emergency planning? Yes, there are OSHA requirements that apply to c-stores. If you have 10 or fewer employees you are partially exempt from recording injury or illness events as OSHA excludes the flu or common cold from recordkeeping, but they have not

“Whether a specific case is compensable will be determined by the facts established during an investigation of the claim, as well as the governing law in the jurisdiction where the claim is reported.” excluded COVID-19 as yet and technically an employer is supposed to report to OSHA within 24 hours inpatient hospitalization for treatment or care if it’s deemed work-related. As with workers' compensation, this is an evolving subject. In summary, OSHA requires employers to furnish a workplace that is free of recognized hazards. Part of this entails developing and implementing an infectious disease and emergency preparedness response plan.

Infection Control And Emergency Planning There are many hazards or dangers that can result in a planned or unplanned store closure or disruption. It could be a hurricane, fire, earthquake, medical emergency, government order or pandemic. It is the responsibility of each owner to manage their risk by planning a response to protect employees and cuscontinued on page 54

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tomers. As an essential business in any disaster, it’s important to have an emergency plan for business continuity and ensure employees understand their role. Planning for health emergencies is unique, as the store has to plan and anticipate operating with fewer employees, a reduced supply chain and limited support from other services. (The FEMA website has information for pandemic and general preparedness plans: https://www.fema.gov/.)

Protect Your Employees

“Because there is no single test that can prove whether an illness or disease is compensable, it may ultimately come down to a decision by a court or state workers’ compensation board.”

● If the store is to close, communicate with employees that you will remain in contact to ensure they and their families are safe, and when a return to work will happen. ● When it is safe to return to the store, be open with your employees to assure they are physically and mentally prepared to Protect Your Customers resume their routine. ● Be knowledgeable through resources at ● Provide employees with hand cleaning your local and state governments, Amer- and sanitizing product, and remind them ican Red Cross, and others. of proper etiquette for coughs, sneezes and ● In an unplanned event, two choices general contact with any customer item. exist: evacuate or shelter-in-place. CusIf an employee is determined positive tomers cannot be forced to shelter but for infectious disease, contact your brocommunicate your plan in a calm but ker/agent, and the insurance company. firm manner. Let the authorities deter- And then check with Ecolab for the mine the course of action. proper cleaning solutions or check the list ● A good notification source of relevant of effective disinfectants at https://www. information from local public safety de- epa.gov/pesticide-registration/list-n-dispartments for your smartphone is infectants-use-against-sars-cov-2. https://www.nixle.com/. Question: What are the most potentially contaminated surfaces in a c-store? Cash, Cooler door handles, front door handles, credit card touch screens, coffee airpot handles, microwave, and almost any surface where customers and employees touch the same surface. At the same time, don’t overlook mop handles, the telephone, cash regRetrain employees on the cleaning guidelines at the sink. Train your employees and train again.

“OSha requires employers to furnish a workplace that is free of recognized hazards. part of this entails developing and imple-menting an infectious disease and emergency preparedness response plan.”

isters, scanners, chair armrests, and computer mouse.

The Future What is being recommended for coronavirus pandemic prevention is what’s considered good hygiene at all times. These include things like frequent hand washing, covering coughs and sneezes, avoid touching eyes, mouth and nose, and cleaning surfaces in the store and at home. This pandemic will end but seasonal flu, illness and the risk of another outbreak will exist, requiring continuing diligence.

Summary There will be a new sensitivity to good hygiene and cleanliness in the future. This can be accomplished by: ● Keeping a high level of general cleanliness of the store. Cleaning should be ABBI. (above, below, behind, inside). Appearance matters! ● Keeping front door glass free of excessive fingerprints. ● Keeping stainless steel, sneeze guards and other common surfaces clean and disinfected. ● Using the correct tools (cleaned) or gloves when handling any customer food items. ● No product on the floor of the cooler. ● Fresh and hot food means more danger of contamination. Make sure employees follow the guidelines. When customers see employees actively cleaning, and that employees are provided the proper tools and information, it shows there is care for their safety and well-being, and reassurance of cleancontinued next page

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Vendor Guest Column continued from previous page continued from page 38

liness. Plan, preach and practice strong infection control, preparedness, and health all the time. Your customers and employees will thank you.

JOHN HARP CAN BE REACHED AT

jharp@msigusa.com or 908-604-2951

———— For training resources and templates, contact your insurance company or broker/agent. Also, the NACS has many free and member-only resources at: https://www.convenience.org/Topics/Operations/Disaster-Preparedness. John Harp, CSP, ARM, is a Risk Engineering Consultant with MSIG Insurance Group.

around the country to help shoppers comply with the social distancing requirements implemented during the coronavirus pandemic, reported Progressive Grocer. • Grocery delivery provider Instacart recently launched a doorstep grocery drop-off service in response to a surge in consumer demand amid rising fears of the coronavirus spreading in the U.S., reported Reuters. The service gives customers the option to have groceries left at their doorstep at a designated time, instead of being hand-delivered. • GasBuddy recently announced the new “Deal Alerts” feature to its smartphone app, which gives motorists below-advertised gas prices that are uniquely tailored to the individual based on factors such as location, retailer- and partner-funded discounts, and appuse frequency. • McDonald’s temporarily pulled its all-day breakfast menu to streamline operations as the coronavirus pandemic continued to strain day-to-day affairs, reported USA Today. The fast-food company said it made the menu alteration to “simplify operations in our kitchens and for our crew, and ensure the best possible experience for our customers.” • Kroger is stepping out of the convenience store sector, recently announcing that it has continued on page 61

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NCASEF to be that neighborhood gathering place or trusted “quick stop” for coffee. Customers come in to get Slurpees for the kids or something they forgot at the grocery store. Today, however, people are coming to our stores for supplies considered crucial to their households. During these times, we want to remind you that it is more important than ever to be a trusted part of your community. SEI sent out a communication recently reminding us of the prohibitions against price gouging. If you have a question about the price gouging laws of your state, send an email to Eric H. Karp, our General Counsel, at ekarp@wkwrlaw.com.

HIGHLIGHTS Currently, different states have enacted varying states of emergencies and sales restrictions on different types of businesses. Please monitor your local rules to be sure you are up to date on any restrictions you may face. When a state of emergency is declared, enhanced consumer protections go into effect, which include antigouging laws in a least 35 states and the District of Columbia. While these state laws vary widely, they prohibit exorbitant, excessive and unconscionable prices, and in some cases prescribe acceptable prices measured against pre-emergency prices. Violations of these laws can bring heavy fines as well as termination of your Franchise Agreement. “We understand that the COVID-19 outbreak is testing us both personally and professionally,” said Hashmi. “The National Coalition encourages you to review your pricing and remain diligent in providing the best prices possible for your customers.” Many franchisees have also decided to put limits on the number(s) of items that may be sold to each customer—things like case pack water, toilet paper, anti-bacterial wipes, and hand sanitizer. “This is a great way to communicate to the communities we serve that we are concerned more with their welfare than with the quick sale.” said Jorgensen. “And doing so at the same everyday retail price creates an opportunity to make people who are scrambling to purchase these commodities wherever they can get them a customer for the long haul. It can be an opportunity to win new customers.” Please take a few moments to review this section of the Operations Manual. Here you will find information about displaying and selling essential goods during emergencies and natural disasters. If you have any questions, please call either of these NCASEF Executive Board Members for clarification: Executive Vice-Chairman Michael Jorgensen (347) 251-1828 Vice Chairman Rehan Hashmi (847) 845-8477 If you have a question about the price gouging laws of your state, send an email to Eric H. Karp, our General Counsel, at ekarp@wkwrlaw.com.

“We will get through this and the 7-Eleven brand will once again stand as a beacon in our communities because of the dedication of the many 7-Eleven franchisees fulfilling our roles and serving our customers what they need, when they need it." We will get through this and the 7-Eleven brand will once again stand as a beacon in our communities because of the dedication of the many 7-Eleven franchisees fulfilling our roles and serving our customers what they need, when they need it. “We stand with SEI in regard to price gouging,” said Rehan Hashmi, NCASEF Vice-Chairman. “We have all heard the saying ‘perception is reality’, so even the perception that we are taking advantage of the situation during this pandemic is something we must avoid.” “Many of us have likely had smaller suppliers offering to sell us products like toilet paper and hand sanitizer at inflated prices,” said Michael Jorgensen, NCASEF Executive Vice-Chairman. “Please resist any urge to do so. If you’re buying something like hand sanitizer at $12 a bottle and selling it for $13, the customer has no idea how much you paid and will only see the exorbitant price you’re charging.” In addition, we must all continue to adhere to brand standards during this emergency. For example, water meant to be sold by the case cannot be separated and sold in individual units.

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NCASEF

HIGHLIGHTS

among the amendments the National Coalition opposes. Proposed by Sen. Andreas Borgeas (RFresno), it would remove franchising from the list of businesses regulated by California Supreme Court’s Dynamex decision, which formed the basis of the law commonly known as AB 5. “There are more than 1,000 7-Eleven franchisees in California. AB 5 will help these operators have greater independence over how they run their stores, so they On March 13, NCASEF General Counsel Eric Karp can support their families, support their employees and sent a letter to SEI regarding the company’s demand best represent the 7-Eleven brand,” said NCASEF Chairthat certain franchisees who signed the new 2019 franman Jay Singh. “We need people to know that AB 5 is chise agreement (NFA) execute and deliver a Franvital to protecting our interests,” said Jaspreet Dhillon, chisee Certification as to wage, hour and immigration NCASEF Treasurer and president of the FOA of greater law compliance. Each demand was accompanied by a Los Angeles. deadline for the franchisee to submit the Franchisee The International Franchise Association is a chief proCertification. The gist of the letter was that the Franponent of weakening AB 5 and claims on its website, chisee Certification does "the only certainty of this law not comply with section is that California franchise 12(c)(3) of the NFA and to businesses may be in grave request an extension of all uncertainty." But, the IFA has deadlines for Franchisee —Keith Miller, a California Subway franchisee and a history of forecasting doom Certifications. whenever government reguprincipal of Franchisee Advocacy Consulting According to a memo lators step in to protect franMr. Karp sent to the chisees, according to Keith Miller, a California Subway NCASEF officers, the matter was referred to SEI’s outfranchisee and principal of Franchisee Advocacy Conside counsel, Norman Leon of DLA Piper in Chicago, sulting. “The biggest myth is that the franchising industry and he and Mr. Karp agreed that the date by which any is heavily-regulated; it’s not,” said Miller. “If the franoutstanding request for Franchisee Certification is due chisees in the 7-Eleven system felt they were being is extended to and including April 30, 2020. ”Between treated as independent contractors—and had the basic now and then, in partnership with a labor and employtenets of business ownership—they would be supporting ment law firm retained by the National Coalition, we will the measures to change AB 5. But they aren’t.” seek to reach an agreement with SEI on the proper form of Franchisee Certification,” Mr. Karp wrote. We will get through this and the 7-Eleven brand will once again stand as a beacon in our communities because of the dedication of the many 7-Eleven franchisees fulfilling our roles and serving our customers what they need, when they need it.

Deadline For Franchisee Certification Extended To April 30

“The biggest myth is that the franchising industry is heavily-regulated; it’s not.”

Sign Up For The Dispatch Newsletter!

NCASEF Opposes Measures To Weaken California Law AB 5 The NCASEF announced that it opposes proposed measures to change or repeal the California law that distinguishes employees from independent contractors, saying it would be harmful to the franchisees operating more than 1,700 7-Eleven stores in the state. SB 967 is

Sign up today to receive Dispatch, the NCASEF’s email newsletter that keeps you up to date on the latest 7-Eleven news and announcements from national leadership. With all the changes and challenges happening within our system, the Dispatch newsletter serves as a direct line of communication between the National Coalition and the franchisee community. Receive urgent information, alerts, and reports directly from national leadership as it happens. Head over to www.NCASEF.com and click on the “Subscribe to Our Newsletter” button on the upper right column of the homepage. Then fill out the form to be placed on the Dispatch email list.

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“In the four-week period from March 16 to April 11, the total number of Americans who filed for unemployment was just over 22 million.” came in Pennsylvania, Ohio and Massachusetts. The smallest gains were in South Dakota, West Virginia, Vermont and Wyoming. Restaurants, bars, hotels, airlines, cruise lines, automakers and entertainment venues have been hit hard by the pandemic as a growing number of jurisdictions ordered the closure of nonessential businesses and directed residents to stay at home.

C-Stores Have Plans In Place A new survey of c-store operators reveals that nearly 70 percent of them have a specific coronavirus plan in place, reported CSP Daily News. The trade publication conducted the survey, which also reveals that nearly all respondents (94 percent) said they were very or semiconcerned about the COVID-19 outbreak affecting their business. The article states the results are based on the responses of about 160 online survey participants between March 23 and 25—a stark contrast to a February 28 poll in which nearly half (46 percent) of c-store retailers said they were not yet concerned about COVID-19. C-stores have faced challenges with staffing, keeping shelves stocked, keeping up with disinfecting and dealing with panicking customers, according to the survey. Nearly all respondents (94 percent) said they wipe down surfaces more frequently with disinfectant to combat the coronavirus. Sixty-three percent said

they had installed hand sanitizing stations, 61 percent have altered foodservice programs, 29 percent have reduced staff and 6 percent have temporarily closed their store. When retailers were asked which categories were dramatically up in dollar sales amid the outbreak, the top answers were tobacco (56 percent), packaged beverages (54 percent), packaged snacks (38 percent) and HBC (27 percent). Fuel (61 percent), foodservice (65 percent) and dispensed beverages (54 percent) were the top categories picked when retailers were asked which categories were dramatically down in dollar sales.

Consumer Spending Remains Higher Than Pre-COVID Levels A new study by NCSolutions (NCS) reveals that the average household grocery spend has jumped 23 percent higher than pre-pandemic levels. NCS has defined five stages of consumer buying, related to the COVID-19 pandemic: Pre-COVID-19 Buying (prior to February 24), Preparedness Buying (February 24 – March 10), Extreme Buying (March

11 – 21), Home-Confined Buying (March 22 and onward), and New Normal Buying (yet to be seen). According to NCS, although consumer spending has fallen since the COVID-19 Extreme Buying peak (35 percent more than preCOVID levels), this shift indicates consumers have entered the Home-Confined Buying purchasing stage. In this new stage, which began on March 22, U.S consumers are adding more food and drinks to their carts but fewer paper products and household cleaning products due to supply issues. Vegetables, salty snacks and cheese are back on top for the week ending March 28. Indulgent comforts are also making their way back into baskets: beer and wine purchases are higher than usual, ranking at number 9 and 11 respectively, compared to number 12 and 14 the year prior. Chocolate, which fell to number 18 during the Extreme Buying stage, climbed to number 12 during the week ending March 28 (likely boosted by the anticipation of Easter), and ice cream and cookies joined the ranks, 14 and 5 spots higher than two weeks prior respectively. Shoppers are also filling their grocery baskets with higher quantities of frozen meals, cheese and lunchmeat than they did last year. Sales of frozen meals, for example, were uncharacteristically high between March 8 and March 28, compared to the same period last year, as consumers stocked their freezers with reserves. Cheese reached number 4 in the week ending March 21, up from number 6 during the same period last year, and continued to climb, after many U.S. schools shifted to remote learning programs and parents were left to fend for themselves for lunch sandwiches. At the

“Categories dramatically up in dollar sales amid the outbreak include tobacco, packaged beverages, packaged snacks and HBC.”

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were 3.1 percent of the U.S. gross domestic product of $21.4 trillion. According to NACS State of the Industry data, fuel sales at convenience stores, which sell approximately 80 percent of the fuel purchased in the United States, were down 3.9 percent from 2018 ($395.9 billion vs. $412.1 billion). In 2019, gas prices averaged $2.57 per gallon, compared with $2.70 for the year Looking back at the U.S. convenience prior. Fuel sales accounted for 61.1 perand fuel retailing industry in 2019, incent of total convenience store revenue store sales increased 4.4 percent ($251.9 dollars and 36.2 percent of gross profit billion in 2019 vs. $242.2 billion in 2018), dollars in 2019. Of the 152,720 convenaccording to newly released NACS State ience stores operating in the United of the Industry data that reflects a preStates, per the 2020 NACS/Nielsen Concoronavirus pandemic climate. Total invenience Industry Store Count, 121,998 dustry sales, which include $395.9 billion stores sell fuel. in total fuel sales, declined by 1.0 percent In 2019, the main categories as a ($647.8 billion in 2019 vs. $654.3 billion percentage of overall in-store merchanin 2018), largely reflective of a 4.7 percent dise sales included: decrease in the price of fuel in 2019. Over● Tobacco: Cigarettes—27.1 percent; all, total convenience store sales in 2019 other tobacco products—7.3 percent ● Foodservice: 25.4 percent ● Packaged beverages: 14.8 “In store sales in the U.S. percent convenience and fuel retailing ● Center store (salty snacks, candy, packaged sweet industry increased 4.4 percent snacks, alternative snacks): in 2019, according to NACS.” 10.1 percent

same time, lunchmeat jumped to number 32—up from number 43 during the same period last year, and bread climbed from number 7 to number 5 between March 8 and 28.

C-Store Sales Increased In 2019

● Beer: 7.4 percent ● Other: 7.9 percent Foodservice sales saw a 4.4 percent increase in 2019 and represented 25.4 percent of inside sales—up from 22.6 percent in 2018. Foodservice also drove overall success at stores: Top quartile performing companies sold 7.7 times more foodservice than bottom quartile performers. Overall, wage expenses increased 7.2 percent and hourly wages for fulltime employees reached $11.75 per hour; $10.83 per hour for part-time. These figures are expected to increase even further in 2020 as many convenience retailers announced temporary hourly wage increases and bonus pay for frontline hourly and part-time employees during the coronavirus pandemic.

SEI Tests Chicken Restaurant In NYC Evolution Store SEI recently opened a Raise the Roost Chicken & Biscuits restaurant in its Evolution store in Manhattan, New York. The new Southern-inspired continued next page

Want to talk to other franchisees? To find the FOA closest to you. Visit www.NCASEF.com to contact any one of the 41 local Franchise Owner’s Associations nationwide. Want to talk to someone at the national level? Call the NCASEF Vice Chairman in your area: The National Coalition has Franchise Owner’s Association member organizations in all 33 states in which 7-Eleven operates. 60

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Paul Lobana, Vice Chairman, President, Southern California FOA

Rehan Hashmi, Vice Chairman, Vice President, Alliance Of 7-Eleven Franchisees

paullobana@aol.com 818.203.2527

rehan711@yahoo.com 847-845-8477

Ajinder Handa, Vice Chairman, President, Greater Seattle, FOA

National Office

425-438-8381 ajinderhanda@hotmail.com

nationaloffice@ncasef.com 210.971.9211


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closed its Fresh Eats MKT format stores in Columbus, Ohio, reported AndNowUKnow.com. Kroger debuted the Fresh Eats MKT c-store format in 2017, during a time when the retailer still operated hundreds of convenience stores. In 2018, Kroger sold its entire cstore operations to EG Group for over $2 billion. • Walmart and Target recently started to limit the number of people in their stores in order to enforce social distancing during the COVID-19 pandemic, reported The Dallas Morning News. Walmart also asked customers to leave their families at home. • Krispy Kreme recently began offering delivery of its fresh donuts nationwide, reported USA Today. On-demand service Doordash is delivering doughnuts by the dozen and boxed coffee for Krispy Kreme, and there’s a $4.99 delivery fee from most locations. • The New York City Council is considering a package of bills to regulate major food delivery apps like Grubhub and Uber Eats after warning them that their business practices were hurting local restaurants, reported the New York Times. Restaurants were being charged commissions ranging from 15 to 30 percent, and Grubhub was routinely billing restaurants for calls that did not result in orders. • Wawa recently broke ground on its first c-store and gas station in Charlottesville, Virginia, reported CBS19 News. The store is set to open in the fall, and the company said it already has four more stores planned for the area. • Juul Labs Inc. plans to include Bluetooth device-locking technology it has been testing in Canada and the United Kingdom with its FDA regulatory application, reported the Winston-Salem Journal. The technology found in the C1 version of Juul’s top-selling e-cigarette allows for monitoring use and allows the device to be manually locked or set to automatically lock when not in use or not in proximity of the connected smartphone. • Scientists have created a mutant bacterial enzyme that not only breaks down plastic bottles in hours, but the leftover material is good enough to be recycled into highquality new bottles, reported Forbes. The French continued on page 62

quick-serve concept is billed as “Chicken Worth Crossing the Road For,” and offers a simple menu: made-from-scratch, hand-breaded fried chicken tenders with signature sauces, bone-in and boneless wings, signature chicken sandwiches, and breakfast sandwiches. The in-store restaurant from 7-Eleven offers both made-to-order and graband-go options. In addition to Raise the Roost, the New York 7-Eleven Evolution Store located at 88 Greenwich Street also offers exclusive products, services and features: ● Made-to-order specialty drinks that give customers the option to customize their drinks in a full-service beverage format including custom hot coffee drinks like flavored lattes, mochas and more as well as custom cold drinks like smoothies, and cold brew coffee. ● Self-serve bean to cup coffee with the addition of touch-screen machines that brew custom hot and iced coffee in just seconds. ● Novelty beverages on tap that dispense cold beverages like tea, cold brew, kombucha, nitro cold brew, flavored drinks, and more. ● Cold treats bar with self-serve frozen yogurt and ice cream that can be swirled to create new flavors with multiple toppings.

● Mobile Checkout—Customers can skip the checkout counter and pay for their purchases via the 7-Eleven app and accompanying 7Rewards loyalty program. 7-Eleven’s Evolution Stores are the first to integrate restaurant concepts into the store design. Last year, 7-Eleven opened its first Evolution Store in Dallas, followed by one in New York City, Washington D.C., and San Diego. SEI said it plans to continue to expand Evolution Stores across the country in 2020.

Seven & I Annual Profit Increases Seven & i Holdings recently announced a 3 percent rise in annual operating profit, but held off presenting an outlook for the coming year as it assesses the impact of the coronavirus outbreak, reported European Supermarket Magazine. Seven & I reported an operating profit of 424.27 billion yen ($3.9 billion) for the year through February, compared with 411.6 billion a year earlier. The company said it would delay announcing guidance and longer-term business plans as it deals with the impact of the coronavirus outbreak. continued on page 62

“Seven & I Holdings abandoned a bid for Marathon Petroleum Corp's Speedway gas stations in the United States aer balking at the price.” AVANTI m a r c h | a p r i l 2 0 2 0

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While Seven & i is considered relatively unaffected by the outbreak as it sells food and other daily necessities, its convenience store business is under pressure amid Japan's tight labor market. In March it abandoned a bid for Marathon Petroleum Corp's Speedway gas stations in the United States after balking at the price. Analysts have said Seven & i may have dodged a bullet by giving up on the deal, as the coronavirus outbreak has weighed on global valuations.

7-Eleven Makes ‘Top 20 Growth Chains’ List 7-Eleven has made it onto Convenience Store News’ Top 20 Growth Chains ranking, coming in at No. 13. The ranking is based on store count figures provided by TDLinx, a service of Nielsen, to identify the c-store retailers that added the most stores in the past year. According to the list, 7-Eleven added 29 stores in 2019, bringing its U.S. total to 9,300 locations—a 0.3 percent increase. Taking the No. 1 spot is EG America, the U.S. subsidiary of U.K.-based EG Group, which grew its store count by 51.5 percent year over year by adding

1,052 units for a total of 2,042. No. 2 is Yesway, which added 281 stores for a total of 417, and Marathon Petroleum Corp. is No. 3, adding 157 stores for a tally of 6,050 locations.

‘Franchise 500’ Ranking 7-Eleven is the highest ranked cstore chain on Entrepreneur Magazine's “2020 Franchise 500” list, coming in at #11. Franchisors are ranked based on five factors: costs and fees; support (training times, marketing support, operational support, franchisor infrastructure, etc.), size and growth, brand strength, and financial strength and stability. Two other c-store retailers made it on the list—ampm lands at #158 and Circle K ranks #174. Taking the top three spots are Dunkin’ (#1), Taco Bell (#2) and McDonald’s (#3).

SEI Acquires Oklahoma Stores SEI recently announced that it has officially closed on the acquisition of more than 100 independently operated continued on page 64

Questions For The CEO? Got a question you want to ask the CEO of 7-Eleven? Submit it via email to nationalcoalition@NCASEF.com. Include the phrase, “Question for the CEO.” We’ll print your question here next issue. All questions are anonymous. The changing environment franchisees face over the next year is bound to raise many issues we have not faced before. We have all signed a new contract that we have yet to test in practice. So, got a question? Let us know: nationalcoaltion2@ncasef.com

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company behind the discovery, Carbios, said it is aiming for industrial-scale recycling within five years and it has partnered with major companies including Pepsi, Nestle and L’Oréal to further advance research and development. • In addition to food, toilet paper, hand sanitizer and other household and protective goods, consumers stuck at home because of COVID-19 also bought products to help them stay connected and entertained, reported CNBC. Jigsaw puzzles and board games were top sellers on Amazon, and sales of yoga mats and other fitness gear also increased. • Molson Coors Beverage Co. recently withdrew its financial outlook for the 2020 financial year and beyond due to uncertainty about the impacts of the ongoing COVID-19 outbreak, reported The Chronicle Journal. The company also announced several initiatives to ensure employees’ safety and the stability of the business, including asking eligible employees to work from home and paying a bonus to salaried and hourly employees who cannot work from home. • Walmart hired 150,000 new employees on a temporary basis to meet surging demand for groceries and household items during the coronavirus pandemic, and paid $550 million in bonuses to existing hourly staff, reported Yahoo Finance. The retailer also kept stores open from 7 a.m. to 8:30 p.m. each day, to make time to clean and restock. • Aiming to help others hurt by the coronavirus outbreak, supermarket chain Publix offered rent relief and other breaks to closed businesses that are tenants of the 282 shopping centers owned by the grocer. • Several states and cities are putting previously approved single-use plastic bag bans on hold, and some are even reversing course, during the COVID-19 outbreak in an effort to help slow the pandemic, reported CBS News. Massachusetts, San Francisco, Colorado, Illinois, Maryland, and New Hampshire have either stopped enforcing their plastic-bag bans or banned reusable continued on page 77

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Sheetz. Kwik Trip, Buc-ee’s, 7-Eleven stores in central and Maverick are also develOklahoma. All stores in“GoFundMe pages have been set up for two oping a pizza fan following. cluded in this acquisition store clerks lost to violence in February.” What makes c-stores attracare located in the greater tive to consumers is their Oklahoma City metropoliproximity to their everyday tan area, bringing the total during a robbery at a 7-Eleven store in routines. A study by NACS reveals that number of 7-Eleven stores in the U.S. Whittier, California. Despite complying 93 percent of Americans live within 10 and Canada to almost 9,800. SEI operwith the gunman’s orders of opening the minutes of a c-store, and sales of preates more than 70,000 stores in 17 councash register drawer and handing over pared food at c-stores has shown strong tries globally. money, for “unknown reasons the susgrowth in recent years. pect fired the handgun, killing the clerk,”

Fundraisers For Slain 7-Eleven Store Employees Two hardworking, dedicated store employees were killed in robberies the same week in late February. The franchisee community offers heartfelt condolences to their families, friends and communities. GoFundMe pages were set up to help the families of both men. The family and community in Edmonds, Washington is mourning the death of Kandasamy Nagendiram, who was shot and killed on February 21 by an unknown gunman. The 64-year-old employee leaves behind a wife and two children. “He was a hard-working employee and a family man who worked full time at 7-Eleven,” said Bobby Padda, who has organized a fundraiser to support his family in this time of need. “This is a big loss for his family and our community.” Early Saturday, February 22, store clerk Maninder Singh, 31, was murdered

according to a police statement. Maninder Singh, the only son of elderly parents, worked hard to support them, his wife and a daughter, 6, and a son, 4. Singh’s father was recently involved in an auto accident in India, which resulted in both of his legs being severely injured. A GoFundMe page was established to help in Maninder Singh’s elderly father’s operation, his kids' educational endeavors, and any other unforeseen expenses.

C-Store Pizza Sales Are Growing While sales figures still show national pizza chains leading in all sales categories, convenience stores are taking a bigger piece of the pie every year, reported BakingBusiness.com. According to CHD Expert, Casey’s General Stores is one of the fastest-growing pizza restaurants in the country. Other regional chains are close behind like Wawa and

Share Your Experience and Expertise Do you have a store experience, some operational expertise, or thoughts about the 7-Eleven system you would like to share with your fellow storeowners? Avanti Magazine welcomes articles from franchisees interested in communicating their ideas, knowledge, suggestions, opinions, etc. to the franchisee community at large. Please contact Sheldon Smith at sheldon.smith5@verizon.net or 215-750-0178 if you would like to contribute an article to Avanti.

Seven & i Drops Plan To Purchase Speedway Seven & i Holdings has scrapped plans to acquire Marathon Petroleum Corp.’s Speedway gas stations for $22 billion, ending a deal that would have been among the world’s biggest this year, reported Bloomberg. The outbreak of the novel coronavirus was one of the factors that impacted negotiations in the exclusive phase. The viral outbreak is imperiling deal-making activity as the coronavirus continues to spread. Early bets on global growth sharply rebounding in 2020 are now in tatters because the consumption demand is slumping as well, the article states. Companies, amid profit warnings, are likely to hire less and squeeze spending, fueling the consumer slowdown further. Seven & i also decided not to proceed with the transaction on concerns over valuations. At about $22 billion, a potential deal for Speedway—which is the second-largest chain of its kind in the U.S. with about 4,000 stores—would have been the biggest overseas acquisition by a Japanese company since Takeda Pharmaceutical’s $62 billion purchase last year of Shire Plc. It would have also been a record purchase for Tokyo-based Seven & i, a retail giant with 69,000 stores worldwide. The company had been expanding in the U.S. continued next page

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market through deals, including a $3.3 billion purchase of Sunoco LP gas stations announced in 2017.

NACS Announces SOI Summit Virtual Experience NACS recently announced that its 2020 State of the Industry (SOI) Summit was recast as a virtual, on-demand experience available for viewing as of April 14. The “2020 NACS State of the Industry Summit Virtual Experience” includes nearly a dozen sessions analyzing industry performance, trends and economic forces in a new era of “anytime, anyplace convenience.” The virtual offering also features a special session looking at how coronavirus (COVID-19) is shaping consumer demands for convenience, in addition to informative sessions that will explore how to take the headwinds of retail disruption, technology and changing consumer need states and turn them into tailwinds to accelerate innovation and win customer trips. The new NACS SOI Summit Virtual Experience is offered as a bundled enterprise registration, opening up

“e virtual offering also features a special session looking at how coronavirus (COVID-19) is shaping consumer demands for convenience.”

participation to attendees from a single organization through one shared license. “In this virtual experience format, we realize one of the most powerful benefits of the live State of the Industry Summit—networking with industry friends and peers—cannot be replicated. We’re excited to bring new virtual collaboration, interactive questions and discussions to the 2020 SOI Summit Virtual Experience. Each session will be accompanied by interactive discussion boards, an ‘ask the presenter’ question-and-answer forum and opportunities to engage with other attendees on your thoughts and ideas for each presentation,” said NACS Vice President of Research Lori Stillman. Complete topic details and speaker bios, along with registration details, can be found at convenience.org/SOISummit.

U.S. Retail Sales Took A Big Hit In March With the pandemic keeping most Americans at home, U.S. retail sales slumped 8.7 percent in March, their worst monthly decline on record in the data available from the Census Bureau, which dates back to 1992, reported CNN Business. Excluding autos and gas, retail sales fell by 3.1 percent. While retail trade fell overall, one category stood out: grocery store sales surged 26.7 percent in March. And sales at non-store retailers, a category that would include e-commerce sites like Amazon, increased 3.1 percent. But sales at clothing and accessories stores, meanwhile, plunged 50.5 percent in

March. Sales at furniture and home furnishing stores declined 26.8 percent, sales at sporting goods stores fell 23.3 percent, and electronics and appliance sales declined 15.1 percent. Except for grocery stores and other “essential” retailers, companies have shuttered stores and furloughed or laid off workers. Consumers have also pulled back their spending on discretionary items. That combination led to the steep drop in retail sales. The coronavirus crisis will widen the gap between big box chains like Walmart and Costco, which are benefiting from panic shopping for groceries, and struggling clothing chains, experts predict.

Amazon Opens Its First Cashierless Grocery Store Amazon recently opened Amazon Go Grocery, its first full-size cashierless grocery store, in Seattle's Capitol Hill neighborhood, reported CNBC. At 10,400 square feet, the store at 610 E. Pike St. incorporates the same technology found in the two dozen or so Amazon Go locations. Shoppers can walk in, scan a QR code from their Amazon mobile app at a turnstile, carry or add whatever they want to their baskets throughout the store, and walk out when they are finished. Zero human interaction is required, though the store has a staff of a couple dozen people to help stock shelves and answer shoppers’ questions. The new store is stocked with about 5,000 items, includcontinued on page 66

“Amazon has opened its first cashierless grocery store in Seattle with over 5,000 items.”

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ing fresh produce, dairy, packaged seafood, meats, bakery treats like doughnuts, household goods like paper towels plus meal kits and a full liquor selection with wines and beer.

Sales Drop In Seattle After Soda Tax A new study shows that sales of sugar-sweetened beverages in Seattle dropped about 30.5 percent in the months after the city adopted a tax on such beverages, reported the Seattle Times. According to the peer-reviewed study by University of Illinois at Chicago researchers, sales in Portland— which has no such tax—declined only 10.5 percent, suggesting sales in Seattle dropped much more than they would have without a tax. The study’s results are the first to measure the impact of Seattle’s tax on beverage sales in the city, and they may bolster claims by supporters that the controversial policy is working as intended.

“Sales of sugar-sweetened beverages in Seattle dropped about 30.5 percent in the months aer the city adopted a sugar tax.” Seattle’s sweetened-beverage tax of 1.75 cents per fluid ounce, which took effect on January 1, 2018, is charged to distributors of sugar-sweetened beverages. Distributors can pass the tax on to stores, and stores to consumers. Proponents said the tax would reduce soda sales and raise money for health and education programs.

Feeding Rural Students The U.S. Department of Agriculture recently announced that it has teamed with PepsiCo, the Baylor Collaborative on Hunger and Poverty, McLane Global, and others to deliver nearly 1,000,000 meals a week to students in a limited number of rural schools closed due to COVID-19. The boxes sent to students contain five days worth of shelf-stable, nutritious, individually packaged foods that meet the USDA’s summer food requirements. The USDA said the use of this innovative delivery system ensures rural children receive nutritious food while limiting exposure to COVID-19. The Baylor Collaborative on Hunger and Poverty, PepsiCo and McLane Global began distributing the meals on March 23. In addition to distribution, PepsiCo provided $1 million in funding to the Baylor Collaborative on Hunger and Poverty to facilitate nationwide distribution in the weeks following the initial rollout.

Conagra Gives Employees Cash Bonus Conagra Brands, Inc. recently announced it will provide cash bonuses to employees at each of the company's pro-

duction and distribution facilities in the U.S., Canada and Mexico. At the company's more than 50 facilities, full-time employees in the U.S. will receive $500 and part-time employees will receive $250, with similar amounts provided to employees in Canada and Mexico. The company said this bonus is in recognition of these team members' relentless efforts to make and deliver much-needed Conagra Brands food to millions of consumers during the COVID-19 pandemic. To further assist employees, the company is also continuing to pay anyone who needs to be away from work due to a COVID-19-related illness. These employees would be eligible to receive the recognition bonus, as well.

Mars Commits Funds To Communities In COVID-19 Response As part of its ongoing response to the global COVID-19 pandemic, Mars, Incorporated recently announced several actions it is taking to better support the communities in which it operates, and the most vulnerable in its extended supply chains. The new commitment includes an initial cash and in-kind donation of $20 million to support the people, pets and communities most affected by COVID19. The support package includes: ● $5 million donation to support CARE for critical supplies and expertise that will be deployed in the developing world, to women, children and refugee populations. ● $2 million donation to the United Nation’s World Food Programme (WFP) to aid in the transport and delivery of critical supplies for all United Nations agencies as they respond to the pandemic. ● $1 million donation to Humane Society International (HSI) to help cats continued on page 68

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and dogs that have been abandoned, left behind or surrendered to shelters due to their owners falling ill or no longer having the financial means to care for them. The company said the balance of $12 million will come from a combination of cash and in-kind donations from across the markets where Mars operates as well as donations from its Foundations including: The Mars Wrigley Foundation, the Banfield Foundation, the Pedigree Foundation and the Tasty Bite Foundation.

Coca-Cola Foundation Awards Grants To Non-Profits The Coca-Cola Foundation, the philanthropic arm of the Coca-Cola Company, recently announced it is awarding a total of $13.5 million in grants to five non-profit organizations that are working on the front lines of the U.S. and Canadian humanitarian response to the coronavirus pandemic. The latest grants support organizations focused on providing relief to first responders and residents of economically disadvantaged communities, both in the company’s hometown of Atlanta and across North America. The company and the foundation said they will continue to evaluate additional opportunities for grants around the world as the crisis evolves. Organizations receiving grants immediately are: • Feeding America: A grant of $5 million will support the organization's COVID-19 Response Fund to enable a network of more than 200 food banks across the U.S. to feed the most vulnerable members of the community during the crisis. • Boys & Girls Clubs of America: A grant of $5 million will help the organization

with its plan to engage more than 4.7 million students in communities where schools are currently closed. Relief efforts will include providing meals and essential community services. • Boys & Girls Clubs of Canada: A grant of $750,000 will help provide food and essentials for families and club employees who are struggling; care for children of emergency health workers; mental health and counseling; and other emergency needs. • Food Banks Canada: A grant of $750,000 will help provide food to communities during the outbreak through a network of more than 650 food bank organizations and 4,500 distribution centers. • Center for Disaster Philanthropy: A $2 million grant will support the center’s COVID-19 Response Fund to help local agencies that provide childcare and other community services for people whose lives and jobs are most impacted by the crisis.

“Anheuser-Busch announced that it will use its supply and logistics network to begin producing and distributing bottles of hand sanitizer.”

Anheuser-Busch Supports Red Cross Anheuser-Busch announced that it will redirect sports and entertainment

investments to its non-profit partners to respond to the COVID-19 public health crisis. As part of a $5 million donation to the American Red Cross, AnheuserBusch alongside its sports partners will identify available arenas and stadiums to be used for temporary blood drive centers. The company’s tour centers in Merrimack, NH, and St. Louis, MO, will also be made available to the Red Cross. As part of the donation, Anheuser-Busch will also donate media airtime to the Red Cross in support of their public service announcements. In addition, Anheuser-Busch announced that it will use its supply and logistics network to begin producing and distributing bottles of hand sanitizer to accommodate the growing needs across the United States. The hand sanitizer will be utilized at Red Cross blood donation centers and to support emergency shelters for future relief efforts.

Mondeléz Supports Employees & Local Communities Mondelēz International U.S. recently announced a series of actions that will enhance its ability to keep its food supply going, protect its employees and support communities impacted by COVID-19. This includes enhanced benefits and support for its U.S. workforce, the hiring of 1,000 additional U.S. workers and a global Mondelēz Internacontinued next page

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tional commitment to donate $15 million to community partners advancing COVID-19 relief efforts in the U.S. and around the world. The company said it has already implemented enhanced protocols and protections to provide a safe and sanitary work environment for its employees, including significant steps to support employees in its manufacturing facilities, distribution and logistics operations and sales organizations. In the U.S., the company announced additional support for its employees who are doing such important work during this challenging time, including: a $2 per-hour increase through May 2nd for its manufacturing, distribution and sales hourly workforce;

and a $125 per-week bonus for its sales representatives. In addition, any impacted U.S.-based employees will receive up to two additional weeks of paid leave at 100 percent of pay, less any statutory pay received for the same period.

Coca-Cola & Georgia Tech Produce Plastic Surgical Shields The Coca-Cola Company has teamed up with Georgia Tech to help protect medical workers on the front line of the coronavirus pandemic, reported TV news station Fox 6 Now. Engineers at Georgia Tech and in

neighborhoods across Atlanta have been working around the clock to manufacture protective gear using lasers and 3D printers. To help in the production, the Coca-Cola Company donated about 6,000 pounds of plastic sheeting. That plastic can be turned into more than 50,000 plastic surgical shields. Those shields will then be donated to hospitals across Atlanta.


7NOW DELIVERY FEES WAIVED SEI offered free delivery with purchase over decades, picking up soluble minerals before and promo code on all orders made through emerging as a naturally alkaline water. This prisits 7NOW delivery app from March 25 tine Icelandic water contains no nitrates, nickel, through April 30. To activate free delivery, cus- cadmium, uranium, phthalates or chlorine. The new Skýra Icelandic spring water is extomers simply had to apply the promo code clusively available in two sizes at participating 7FREE4U upon checkout. In the period during the COVID-19 pandemic when social distanc- Eleven stores—20 ounces for $1.99 and 1 liter ing and sheltering in place were for $2.69. For a limited time, two 1-liter bottles widely encouraged, 7-Eleven’s deliv- will be available for a promotional price of $4. ery service offered a contactless delivery option where customers SEI EXPANDS EVOLUTION could indicate if they preferred STORE CONCEPT their delivery “contactless,” meanSEI recently announced that it has exing the delivery would be left at the panded its Evolution Store concept to Washdoor by the driver. ington, D.C. and San Diego following the SEI says the 7NOW delivery app successful opening of its beta store in Dalis available in nearly 400 las last March. These Evolution cities, giving approxiStores serve as real-time expemately 35 million riential testing grounds The 7NOW households in the where customers can try the app is available in United States access to latest innovations in 7nearly 400 cities over 3,000 items they may Eleven store formats. Both and to 35 million need during the pandemic. stores include a Laredo Taco households. Available products in-app inCompany restaurant. clude grocery staples like milk SEI said its first Evolution and bread, over-the-counter medicine, Store exceeded its expectations with household goods, a range of food and bever- enthusiastic reviews, crowds of customers and age options like pizza and Slurpee drinks, beer sales that continue to climb. Concepts that resonate with consumers are refined before being and wine, and more. incorporated into the next generation of current and new store standards. SUPER-PREMIUM

PRIVATE BRAND WATER SEI has added a new super-premium water imported from Iceland to its private brand portfolio. Created exclusively for 7-Eleven, Skýra Icelandic spring water is naturally alkaline with electrolytes, a high pH (8.8) and naturally low mineral content. Skýra water is sourced from an Icelandic spring in a government-protected nature preserve. Filtered through inert layers of lava, the water trickles deep into the ground

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In addition to Laredo Taco Company, 7Eleven Evolution Stores offer an assortment of exclusive products, services and features customized to the neighborhoods and customers they serve such as made-to-order specialty drinks, cold treats bar with multiple frozen yogurt and ice cream flavors, and cookies, croissants and pastries baked fresh in-store daily.

TRANS@CT HELPS UNBANKED GET STIMULUS PAYMENTS With its Trans@ct by 7 Eleven Prepaid Mastercard, SEI is providing a convenient solution to under- and un-banked individuals and families to help them receive the stimulus payments being sent out by the U.S. Treasury Department in response to the COVID-19 pandemic, faster than a paper check. The Trans@ct by 7 Eleven® Prepaid Mastercard® offers cardholders an alternative to brick-andmortar banks, and can receive direct deposit payments such as government benefits or paychecks. After registration and activation, all funds loaded onto Trans@ct by 7 Eleven card accounts are FDIC-insured. To facilitate stimulus payments, the U.S. Treasury Department has set up a web portal to allow individuals to update their direct deposit information. Trans@ct by 7 Eleven cardholders can update their account information to receive their stimulus checks via direct deposit sooner, rather than waiting to receive the payments in the mail. Customers can purchase a Trans@ct by 7 Eleven card at participating 7 Eleven® stores, or they can apply online at https://www.transact711.com/. After customers complete enrollment, they will receive account information that can be continued next page


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used to update direct deposit information. Some of the benefits of the Trans@ct by 7 Eleven Prepaid Mastercard include: ● Reloadable—Money can be loaded onto the card at any 7 Eleven store. ● ATM cash withdrawals at Allpoint Network ATMs in 7 Eleven stores, or any ATM with a Trans@ct by 7 Eleven logo, are fee-free. ● Shop—Use wherever Debit Mastercard is accepted. ● Mobile App—Access account information in the Trans@ct by Trans@ct 7 Eleven Mobile by 7 Eleven App or in the Prepaid Mastercard Online Account is a service to unCenter, and banked individuals track spending, and families. check deposits and account balance. ● Bill Pay—Pay bills using the Trans@ct by 7 Eleven Mobile App, online at www.transact711.com, as well as at any 7 Eleven store. ● Load Checks With Phone—Use iPhone or Android smartphone camera to load checks onto the card account with the Mobile App. ● Earn rewards—Regular use of a Trans@ct by 7 Eleven account earns waived fees and 7Rewards® loyalty program members can link their account to the Trans@ct by 7 Eleven card to earn points that can be redeemed for 7 Eleven merchandise.

NEW COFFEE BEVERAGE OPTIONS SEI announced that it has dramatically expanded its hot and cold beverage menu to all Long Island, New York 7-Eleven stores with the addition of touch-screen machines that brew custom hot coffee drinks like lattes, cappuccinos and espresso shots in just seconds, as well as taps that dispense cold beverages like cold

brew, teas, lemonade and more. Customers can make their cup, their way at the expansive condiment station with various toppings, sprinkles and sweeteners. The store updates also include new ovens for baked-in-store croissants, cookies and pastries, as well as self-serve hot food and roller grill items. SEI said it plans to expand these new coffee and fresh food platforms to more stores around the country this year, with work already beginning in Virginia, Florida and California.

WILD ALASKA POLLOCK SANDWICH DURING LENT 7-Eleven launched a new Wild Alaska Pollock Fish Sandwich menu item in participating U.S. stores. The herb-crusted Wild Alaska Pollock fillet with American cheese and tartar sauce on a buttery bun was available until April 20, 2020 and retailed for $2.49. Consumers looking for a Lenten meat alternative were able to purchase the product for a promotional price of $2 on Fridays through the 7REWARDS loyalty app. “Customers looking for a hot fish sandwich because they’re observing Lent dietary restrictions, or just because they love a good fish sandwich can find this limited-time offering in our hot cases,” said Robin Murphy, 7-Eleven fresh food product director.

PIZZA PI DEAL Participating 7-Eleven stores nationwide celebrated everyone’s favorite math holiday— National Pi Day (March 14, or 3.14)—with

one-day specials on in-store pizza slices and delivered whole pizzas. The two Pi Day pizza deals included: • $3.14 Pizza Pi In Store and Delivered—Customers were able to get a whole pizza pie for $3.14 inside stores through 7Rewards and outside stores on the 7NOW app for delivery to their home, workplace or almost anywhere. • 50 Cent Slices In Stores—7Rewards members who visited participating 7-Eleven stores on National Pi Day were also able to purchase a pizza slice for just 50 cents by scanning their 7-Eleven app at checkout.

HOSPITAL POP-UP 7-ELEVEN STORE SEI announced that it has opened its first-ever hospital pop-up store at Children's Medical Center Dallas, the flagship hospital of Children's Health. The store provides access to food and essential items for health care workers and patient families during the COVID-19 health crisis. The pop-up store features grocery and personal care products such as take-home dairy, paper towels, toilet paper, laundry detergent, and phone chargers as well as an assortment of fresh food options including salads, heat-and-eat entrees and take-andheat pizza and wings. To enhance the safety of the shopping experience during this unprecedented time, the pop-up store allows hospital staff to use their employee badges to pay for merchandise, the company said in a press release. The store also offers traditional credit/debit checkout with an acrylic sneeze guard at the counter to reduce person-to-person contact. 7-Eleven's frictionless and contactless Mobile Checkout feature will soon continued on page 72

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be available at this location, allowing customers to scan and pay for their purchases using the 7-Eleven app on their mobile phones. SEI said mobile checkout is designed as a convenient alternative to traditional checkout and is more important now than ever. Located in the Moore Auditorium at Children's Medical Center Dallas, which typically houses large meetings and gatherings, the popup store is open to hospital staff as well as patients and their family in the hospital with them. The Food Services team at Children's Health is working alongside 7-Eleven to operate this popup store, including stocking shelves and checking out customers, SEI said. In addition, 7-Eleven is assisting stores near the two other hospitals in the Children's Health system, Children's Medical Center Plano and Our Children's House in Dallas, to have the products needed to serve health care workers at each of these locations. They are receiving their items at their hospital locations with free delivery thanks to the 7NOW delivery app.

PAYMENT SOLUTION LAUNCHED IN LATIN AMERICA

onds. Consumers can begin paying bills immediately by creating an account; adding a bill; showing the 7-Eleven cashier the barcode generated on their smartphone and telling them the amount to pay; and providing cash for payment. The user will be provided with a receipt as proof of payment.

7-Eleven has partnered with Arcus, a leading fintech platform, to introduce a suite MALAYSIA SETS of modern fintech payment solutions to their mobile app in Latin America, focused on cash- SALES RECORD 7-Eleven Malaysia set a centric consumers. 7-Eleven said it is full-year sales record last year leveraging Arcus’ technology to after revenue rose 6.4 perpower a more seamless, inteApp users are cent to $33.76 billion, grated payment experience able to keep track of reported Retail News for Latin American custheir payment history, Asia. Much of the tomers paying with cash. In set reminders and growth came from a released statement, the securely pay their bills network expansion, companies explained that in less than but same-store sales the 7-Eleven app, powered by 60 seconds. rose 2.5 percent, despite Arcus’ Payments and Cash to declining cigarette sales. The Digital solutions, serves as a full-sercompany opened 165 new stores last vice bill payment center, giving customers using cash a year—41 of those in the last quarter—taking better way to manage their its network to 2,411. Other factors were higher footfall and an increase in the average transacpayments. With one trip to their tion. Fresh-food sales grew more than 28 perlocal 7-Eleven store, app cent year on year. 7-Eleven Malaysia CEO Colin users are able to keep track Harvey said the company had kept costs in of their payment history, set check, reducing them from 29 percent of reminders and securely pay turnover to 28.4 percent, despite an increase in their bills in less than 60 sec- the minimum wage.

Advertiser’s Index

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Monster................................9 Swisher...................5, Cover 4 Nestle Waters.....................69 Tell Industries.....................39 Path Water .........................28 Windsor..............................40 Pepsi Quaker ......................47 Simply Orange .....................4 Splenda..............................67


Join Your Local Franchise Owner’s Association Today! The best way to stay informed of the latest changes and challenges to our 7-Eleven system—and the convenience industry, in general—is to join your local Franchise Owner’s Association. FOAs help franchisees share ideas and concerns, and allow us to approach “None of us is as great our franchisor and vendor as all of us together.” partners with a unified voice. Becoming an FOA member also makes you a member of the National Coalition, which consists of all 43 FOAs nationwide. To join your local organization, contact the FOA president closest to you, or follow the instructions below to fill out an online membership form. If you cannot find the FOA closest to you, contact nationaloffice@ncasef.com for more information. We welcome your participation!

How do I join an FOA? 1. Log in to 7 Help using 7 Hub (secured) in-store or using this link https://7elevenna.service now.com/ from any external device. 2. In the search bar type “FOA.” 3. Select the popup suggestion “FOA/PAC: FRANCHISE OWNERS ASSOCIATION.” 4. Type “NONE” in the “Current FOA” box if you are joining an FOA for the first time or you are not a member of any other FOA. 5 Type in the full name of the FOA that you wish to join (No abbreviation) in the “Future FOA” box. 6. Type in the amount of monthly dues as instructed per local FOA. 7. Type “Please enroll (store number) as a member of (name of the local) FOA.” 8. Repeat Step 7. 9. Press the green submit icon.

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Monster Introduces New Hydro Super Sport

New Hydro Super Sport from Monster quenches thirst and offers superior hydration.

Built on the backbone of Monster Hydro, new Hydro Super Sport adds key functional ingredients like BCAAs, calcium, magnesium, and additional caffeine, delivering a multifunctional, performance hybrid drink that quenches thirst and offers superior hydration. Available in two refreshing flavors: Blue Streak and Red Dawg.

José Olé Is Back

Smirnoff Sparkling Seltzer variety pack: Smirnoff Red, White & Berry Seltzer 12-pack Can—The delicious taste of Smirnoff Red, White & Berry is now available for a limited time only in a light and crisp, zero sugar hard seltzer. Available in a 12-pack can, it focuses on the key summer holidays pairing the #1 FMB LTO (Smirnoff Red, White & Berry) with the #1 drink in the segment (Seltzer). Consumers love that it comes in a fun Cold-ActiIntroducing Smirnoff Red, White & Berry Seltzer with zero sugar. vated can that turns blue with stars when it’s chilled. In the fall, the UPC will transition to a Seasonal Variety Pack with four top flavors: Peach, Cranberry Lime, Raspberry and Blackberry. Get the only Cold Activated Can in Seltzer before it’s gone. (SLIN 106002) Smirnoff Seltzer Variety 12-pack will have a brand-new look. Check out the refreshed packaging with a clean modern look. Arriving in stores in May/June (SLIN 101211).

America’s #1 premium Mexican handheld brand is in stock and ready to ship to 7-Eleven stores nationwide. José Olé has delivered delicious and satisfying frozen Mexican food to today’s hungry, on-the-go consumer for over 20 years and the tradition returns to 7-Eleven. José Olé was discontinued two years ago and replaced with a 7-Select/José Olé co-branded version. The 7-Select items have been discontinued, and José Olé has been reinstated and re-recommended in the POG. José Olé uses the finest ingredients, like tender cuts of meat, real Bug Juice is the #1 children’s drink in cheese, oven-baked tortillas, and auc-stores today. With 50 percent profit thentic seasonings and spices, to deliver premargins and brand awareness at 99 permium, restaurant quality chimichangas that cent, Bug Juice outsells the $0.99 other keep consumers coming back to your frozen stuff 2 to 1, according to A.C. Nielsen. food case time and again. Available in two flaMoms love it, kids love it, José Olé premium frozen Mexican vors, Beef and Chicken, José Olé offers the fiesta food has returned to 7-Eleven. and you will love it, too. and flavor that your consumers crave. With an SRP of $1.19, Bug Juice is available ● José Olé Beef & Cheese Chimichanga 5-ounce: SLIN 180406, in 24-count 10oz bottles and in four flavors: McLane UIN 552026, Core-Mark 467461 ● Berry Raspberry (SLIN# 242825) ● José Olé Chicken & Cheese Chimichanga 5-ounce: SLIN ● Fruity Punch (SLIN# 242826) 180485, McLane UIN 459768, Core-Mark 467462 ● Outrageous Orange (SLIN# 242824) ● Lemony Lime (SLIN# 240491) Bug Juice is also now a proud Affiliate Member of the NCASEF. For more informaEnjoy 50 percent tion, please contact Richard Hunsberger at Diageo Beer Company recently unveiled a new Smirnoff profit margins with rhunsberger@bugjuice.com or 214-914-5531. Bug Juice. hard seltzer product and announced new packaging for its

Bug Juice Outsells 2 To 1

New Smirnoff Hard Seltzer Item & Variety Pack Design

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Aloevine Organics For Healthy Beverage Sales

brand in the United States for consumers looking for an alternative to traditional tobacco. Led primarily by the results of Zyn, the nicotine pouch category continues to Zyn is the #1 tobacco-free nicotine pouch brand in the U.S. expand and is quickly becoming an invaluable source of growth for retailers. Contact your Swedish Match Representative or call 800-367-3677 for additional details.

J.J. Martin Group, one of the market leaders of aloe-infused beverages and the brand owners of Aloevine and Salutti aloe drinks, has created a unique, healthy and refreshing aloe beverage that is only 5 calories per bottle—Aloevine Organics. Beverage consumers have demonstrated their growing preference toward better for you, organic, non-GMO, nothing artificial, and lowcalorie alternatives to soda and sugary drinks. With this in mind, Aloevine Organics was born. Manufactured in the USA with USDA Introducing Trident Vibes Sour Berry Certified Organic ingredients, Aloevine OrTwist, the latest innovation to hit the gum ganics contains nothing artificial and is inand candy racks in years. This sour gum has fused with 15 percent water soluble aloe a candy-like flavor with hints of lemon and solids. You get the benefits of drinking aloe, lime and a smooth twist of berry that wakes without the worry of calories and poor taste. Aloevine Organics is priced to sell to up taste buds in a big way. Sour candy sales are Aloevine Organics contains natural flavorings like your health-conscious customers. growing five times faster than non-sour candy lemon, blueberry, and strawberry, and is sweetened with natural ingredients like agave and monk fruit. Best (Source: 3yr CAGR for Sour and Non-Sour Candy $ Sales), but of all its only 5 calories per 500 ml bottle, so your customers can there were no major brand sour gum offerings until now. Market research proves that sour gum is something that conenjoy all three flavors. Aloevine Organics is priced to sell at sumers are ready to try, with 38.5 percent of sweet candy buyers also competitive price points to other beverages in its class. buying sour candy (Source: The NPD Group/SnackTrack 2.1 April

New Trident Vibes Sour Berry Twist

Zyn Tobacco-Free Nicotine Pouches Zyn Tobacco-Free Nicotine Pouches have not only revolutionized how people enjoy nicotine, but have changed the entire tobacco category. In 2016, Zyn was introduced across the western United States as a convenient, tobacco-free nicotine pouch that consumers could enjoy for up to one hour, anywhere, anytime. Zyn’s 2019 nationwide expansion has delivered immediate success and shown growth patterns that exceed the initial release in the West. Zyn is the #1 tobacco-free nicotine pouch

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EARN BIG PROFITS WITH 5-HOUR ENERGY How do you earn $2,500 in new profit? It’s as easy as adding 5-hour Energy to your front counter. With a whopping 55 percent gross margin, 5-hour Energy will be one of the most profitable items in your store. It’s also one of the top impulse items in retail today. That’s why the most successful 5hour Energy retailers always have a rack full of the best-selling flavors right next to the cash register. Please see the 5-hour Energy ad 5-hour Energy has a on page 30. whopping 55 percent gross margin.

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19, 2019). Sour flavors are driving huge growth in the candy category and Trident is excited to bring that momentum to the gum market. As part of a Trident promotion, your customers will be enticed to buy new Trident Vibes Sour Berry Twist with a 2 for $6 deal, April 1 to May 19. Be the first to sink your teeth into this deal. Stock up your store with Get 80 percent off your Trident Vibes Sour Berry Twist and get 80 first order of Trident Vibes Sour Berry Twist. percent off your first order when ordered between April 1 to May 19.

Join The Cheesecake Factory Ice Cream Craze Earlier this year, The Cheesecake Factory At Home introduced creamy, premium ice cream for cheesecake lovers nationwide to enjoy exclusively at home. The new collection includes seven celebratory flavors all made with a signature cream cheese blend and sour cream for a velvety smooth experi-

ence in every spoonful. The Cheesecake Factory collaborated with Wells Enterprises, Inc., a Le Mars, Iowa ice cream manufacturer, to produce its innovative ice cream line with real cheesecake ingredients incorporated right into the mix. The delicious line-up includes the following flavors: Original, Strawberry, Birthday Cake, Salted Caramel, Key Lime, Chocolate, and Cookies & Cream. Each flavor is sold in a 14 oz. pint container with an MSRP of $4.99. Since the product’s official release in February 2020, the launch has gained nationwide attention (resulting in over 1 billion media impressions) from Delish, PopSugar, Newsweek, Fox, Thrillist, USA Today, MarketWatch, Food Business News, BuzzFeed and more with consumers everywhere eager to find every flavor in stores near them. Don’t miss out on the craze.

Swisher Sweets Banana Daiquiri

Consumers are eager to find The Cheesecake Factory Ice Cream in stores near them.

FIX-A-FLAT NOW AVAILABLE IN 7-ELEVEN STORES The #1 safest and fastest flat tire solution is now available to carry on your store shelves. Fix-a-Flat has been trusted by your customers for 50 years. It is designed to seal small tire punctures in seconds and provide enough inflation to lift the rim off the ground. The 20-ounce can is perfect for large-sized tires. Fix-a-Flat seals 33 percent larger punctures than the previous formula and is an easy-to-use, better alternative to the spare tire. No need for a jack or tools. Also, it is tire sensor safe. With its eco-friendly formula allowing it to be non-flammable, non-toxic and non-corrosive, Fix-a-Flat is safe for the user, the tire and the environment. Fix-a-Flat has a new look. The plastic cap has been tossed and replaced with a modern Performance Top, making Fix-a-Flat even more eco-friendly and easier to use. Watch as your shoppers reach for the famous yellow can that they can rely on. Just connect, inflate and go. 76

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Swisher Sweets limited-edition Banana Daiquiri cigarillos offer a unique blend of the smooth sweetness of banana with a splash of rum. Banana Daiquiri is sure to delight customers who can enjoy happy hour at any hour with its sweet, satisfying taste and popular pricing. Limited edition cigarillos continue to be a huge hit, and Banana Daiquiri is on track to be as popular as favorites of the past. The timeless taste will give customers a reason to Banana Daiquiri is on track to be celebrate. Swisher as popular as Swisher Sweets favorites of the past. Sweets Banana Daiquiri cigarillos are available in a variety of market-driven price points, but only while supplies last. To place an order, contact your Swisher representative at 1-800-874-9720. For more information, visit www.swisher.com.


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bags outright. • All Starbucks employees in the U.S. and each of their eligible family members will be able to access up to 20 therapy sessions a year as part of a sweeping expansion of the Seattle-based company’s mental health benefits, reported Fast Company. The coffee retailer has contracted with Lyra Health, a provider of mental health benefits, to connect employees with therapists or coaches. • Target recently detailed several new initiatives for 2020, including expansion of its smaller-sized format and testing a c-store sized format, reported Chain Store Age. The retailer is planning to open nearly 36 small-format stores in 2020, and will begin exploring sites for stores that are about the size of c-stores to reach even more shoppers in urban neighborhoods. • Panera Bread has a new coffee subscription program for its MyPanera loyalty members that offers unlimited hot or iced coffee for $8.99 a month, reported USA Today. One cup daily in a 30-day month averages around 30 cents a cup. • Pennsylvania-based retailer Sheetz is the only convenience store chain to rank on the “2020 Fortune 100 Best Companies to Work For” list, coming in at No. 80. This is the sixth time that Sheetz has appeared on the list. • Speedway recently announced that it raised $11.8 million for kids treated at Children’s Miracle Network Hospitals across the United States in 2019—a 25 percent increase from the previous year’s efforts. The donations were raised by daily contributions made by customers, business partners and employees throughout the year. • Walmart is working on a paid membership model called Walmart+ that would directly compete with Amazon Prime, reported Fox Business. The offering would include certain Amazon-like perks, but the platform would also offer exclusive options, like text-to-order.

FOA Board Meeting Dates CENTRAL FLORIDA FOA Phone: 207-415-0924 May 19, 2020 August 25, 2020 November 10, 2020

August 20, 2020 September 17, 2020 October 22, 2020 November 19, 2020

SOUTHERN CALIFORNIA FOA

COLUMBIA PACIFIC FOA

Phone: 818-357-5985

Phone: 503-998-5941

May 20, 2020 July 15, 2020 September 16, 2020 November 18, 2020

June 2, 2020—Board Meeting September 17, 2020—General Members Meeting October 29, 2020—Board Meeting

FOA OF GREATER LOS ANGELES Phone: 619-726-9016 May 19, 2020 June 16, 2020—Meeting & Mini Trade Show July 21, 2020 September 15, 2020 October 20, 2020—Meeting & Mini Trade Show November 17, 2020

MIDWEST FOA Phone: 847-971-9457 May 21, 2020—Board Meeting June 25, 2020—Board/General Meeting, cohosted with Alliance of 7-Eleven Franchisees FOA July 23, 2020—Board Meeting August 20, 2020—Board Meeting October 22, 2020—General Meeting & Golf Social October 29, 2020—Board Meeting November 19, 2020—Board Meeting

SAN DIEGO FOA Phone: 619-713-2411 May 21, 2020 June 11, 2020 July 16, 2020

SOUTH NEVADA/ LAS VEGAS FOA Phone: 702-561-0311 May 7, 2020—Board Meeting June 11, 2020—Board Meeting June 25, 2020—General Meeting July 16, 2020—Board Meeting August 9, 2020—Board Meeting September 10, 2020—Board Meeting September 17, 2020—General Meeting October 8, 2020—Board Meeting November 12, 2020—Board Meeting November 19, 2020—General Meeting & Elections December 10, 2020—Board Meeting

South Texas FOA Phone: 702-249-3301 May 20, 2020—Board Meeting June 17, 2020—Board Meeting June 20, 2020—General Meeting July 8, 2020—Board Meeting August 19, 2020—Board Meeting September 9, 2020—Board Meeting September 16, 2020—General Meeting October 7, 2020—Board Meeting November 11, 2020—Board Meeting November 18, 2020—General Meeting December 2, 2020—Board Meeting

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foa events Eastern Virginia FOA Annual Trade Show The River Place Fort Mill, South Carolina May 13, 2020 Phone: 757-506-5926

Delaware Valley FOA Trade Show Caesars Atlantic City Hotel Atlantic City, New Jersey July 16, 2020 Phone: 215-771-6178

Greater Oregon FOA Golf Tournament

Midwest FOA Michigan Trade Show

(Venue TBD) July 16, 2020 Phone: 503-984-1398

(Venue TBD) May 28, 2020 Phone: 847-971-9457

San Diego FOA Day At The Races

San Diego FOA Charity Golf Tournament The Vineyard at Escondido Golf Club Escondido, California June 3, 2020 Phone: 619-713-2411

Greater Oregon FOA Annual Trade Show Monarch Hotel Clackamas Oregon July 15, 2020 Phone: 503-984-1398

FOA Of Southern California Charity Golf Tournament Industry Hills Golf Club at Pacific Palms Resort City of Industry, California June 17, 2020 Phone: 818-357-5985

Columbia Pacific FOA Golf Tournament The Reserve Vineyards and Golf Club Aloha, Oregon June 22, 2020 Phone: 503-998-5941

Chesapeake Division FOA Trade Show Waterford at Springfield Springfield, Virginia June 25,2020 Phone: 571-344-2781 78

Del Mar Racing Del Mar, California August 28, 2020 Phone: 619-713-2411

San Francisco/ Monterey Bay FOA Golf Tournament Castlewood Country Club Pleasanton, California August 31, 2020 Phone: 510-693-1492

San Diego FOA Vendor Appreciation Day Alesmith Brewery San Diego, California October 7, 2020 Phone: 619-713-2411

Midwest FOA/ Alliance of 7-Eleven Franchisees FOA Golf Social Top Golf Chicago Naperville, Illinois October 8, 2020 Phone: 847-971-9457

South Nevada/ Las Vegas FOA Table Top Trade Show Sierra Gold Las Vegas, Nevada October 15, 2020 Phone: 702-561-0311

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NCASEF

Board meetings National Coalition Board of Directors Meeting

NE TPO

D

Hyatt Regency Long Island Hauppauge, New York May 13-14, 2020

POS

National Coalition Board Of Directors Meeting Gaylord National Resort & Convention Center National Harbor, Maryland August 9-10, 2020

Midwest FOA/ Alliance of 7-Eleven Franchisees FOA Holiday Party Chicago O'Hare Marriott Chicago, Illinois December 2, 2020 Phone: 847-971-9457

Columbia Pacific FOA Holiday Party (Venue TBD) December 6, 2020 Phone: 503-998-5941

Midwest FOA Michigan Holiday Party (Venue TBD) December 9, 2020 Phone: 847-971-9457

NCASEF 45th Annual Convention & Trade Show Gaylord National Resort & Convention Center National Harbor, Maryland August 10-13, 2020

National Coalition Affiliate Meeting Grand Hyatt Kauai Resort & Spa Koloa, Hawaii November 2, 2020

National Coalition Board of Directors Meeting Grand Hyatt Kauai Resort & Spa Koloa, Hawaii November 2-4, 2020

Central Florida FOA Christmas Party (Venue TBD) December 12, 2020 Phones: 207-415-0924

San Diego FOA Holiday Party Hilton San Diego/Del Mar Del Mar, California December 12, 2020 Phone: 619-713-2411


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