Avanti March/April 2018 by Avanti Magazine

March/April 2018

T H E

V O I C E

O F

7 - E L E V E N

F R A N C H I S E E S

Rethinking Efforts To Change The System For Franchisees

VISIT NCASEF.COM

Remaking Of A Coalition Thought Behind The Convention Theme 7-ElevenNOW Program Amendment The Elusive SSI And NRI Why Is Our Customer Count Declining? Servant Leadership Crime And Assault Prevention Troubleshooting Electronic Price Signs

PRSRT STD U.S. POSTAGE PAID Philadelphia, PA PERMIT No. 85

THE VOIC E OF 7-ELEVEN FRANC H ISEES

March/April 2018

Contents 29 The Remaking Of A Coalition By Jay Singh, Chairman, NCASEF

33 The Thought Behind The Convention Theme

51 Crime And Assault Prevention—An Update By John Harp, CSP, ARM, Risk Engineering Consultant, Mitsui Sumitomo Insurance Group

By Michael Jorgensen, Executive Vice Chairman, NCASEF

39 7-ElevenNOW Program Amendment—More Questions Than Answers By Eric H. Karp, Esq., General Counsel, NCASEF

59 Servant Leadership Hari Patel, President, Metro New Jersey FOA

72 Troubleshooting Electronic Price Signs By Wolfgang Manz, President & CEO, PWM Electronic Price Signs

45 Unmasking The Elusive SSI And NRI By Nick Bhullar, Vice Chairman, NCASEF

Come One, Come All! The NCASEF National Convention and Trade Show Orlando, July 23-26 Page 22

49 Why Is Our Customer Count Declining? TS

By Romy Singh, Vice Chairman, NCASEF

24 Fun & Sales At The FOAGLA/San Diego FOA Trade Show 54 Simply Beverages Incentive Contest: Order To Win! 66 Greater Seattle & Pacific NW FOAs Hold First Joint Trade Show

PA R

16 Midwest FOA Holds First General Meeting

Features

Member News ..........14 Bits & Pieces ..........16 Legislative Update18 SEI News ................75 Vendor Focus ..............81 Franchisee Calendars.........................89

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.

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NATIONAL COALITION OF ASSOCIATIONS OF 7-ELEVEN FRANCHISEES NATIONAL OFFICERS

Judge Dismisses Franchisee Lawsuit A California judge has “dismissed with prejudice” a lawsuit by 7-Eleven franchisees against the parent company, reported e Dallas Morning News. e four members of the National Coalition of Associations of 7-Eleven Franchisees filed the lawsuit in October 2017, saying SEI has been chipping away at franchisees' profits and increasing their costs. e lawsuit also said that SEI was exercising more control over the independent businesses of the franchisees. In an order dated March 14, 2018 in U.S. District Court for Central California, the judge concluded that the franchisee plaintiﬀs did not demonstrate that SEI exercises control over the their wages, hours or working conditions and can’t show that an employment relationship exists, reported CSP Daily News. e court also concluded that the franchisees have not demonstrated that SEI exercised the type or degree of control necessary to create an employment relationship between the parties, nor that SEI exerted control over the day-to-day operation of franchisees’ stores.

Instead, the judge stated, the allegations demonstrate that SEI retained control over service standards, merchandise selection and presentation, hours of store operation, employee uniforms and other aspects of store operations that were necessary to protect 7-Eleven’s trademark, trade name and goodwill. e judge also required the two sides to reach an agreement on the claims and counterclaims in the lawsuit.

Jatinder Singh NATIONAL CHAIRMAN

702-249-3301 • jays@ncasef.com

Michael Jorgensen EXECUTIVE VICE CHAIRMAN

347-251-1828 • mcjorg@yahoo.com

Nick Bhullar VICE CHAIRMAN

626-255-8555 • bhullar711@yahoo.com

Rehan Hashmi VICE CHAIRMAN

847-845-8477 • rehan711@yahoo.com

Romy Singh VICE CHAIRMAN

C-Stores Sales & Profits Up In 2017 U.S. convenience stores experienced a 15th straight year of record in-store sales and a fourth straight year of $10 billionplus in pretax profits, according to newly released NACS State of the Industry data. Convenience stores sales overall surged 9.3 percent to $601.1 billion, led by a 14.9 percent increase in fuel sales. Convenience stores sales overall are 3.2 percent of the overall U.S. gross domestic product of $18.57 trillion (2016 data). Put another way, one of every 30.9 dollars spent in the country was spent at a convenience store in 2017. e sales increase at convenience stores in 2017 was largely because of higher gas

“A California judge dismissed the independent contractor lawsuit brought by four franchisees ‘with prejudice.’”

continued on page 16

757-506-5926 • evafoa@gmail.com CONVENTION CHAIRPERSON

520-577-8711 nationaloffice@ncasef.com

Jaspreet Dhillon TREASURER

310-892-2106 • jaspakam@gmail.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

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

John Santiago ASSISTANT EDITOR 215 750-0178

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.

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AVANTIMAG@VERIZON.NET

The Voice of 7-Eleven Franchisees March/April 2018

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

prices in 2017 (up 12.8 percent to $2.38) and a 1.9 percent increase in gallons sold. Meanwhile, fuel gross margins in 2017 increased to 22.0 cents per gallon. Paired with increased sales volume overall, fuel gross profits increased 11.7 percent per store. According to the report, convenience store profits were $10.4 billion, a 1.6 percent increase over 2016. e last time the convenience store industry reported negative profits was 1991. Meanwhile, in-store sales increased 1.7

percent to a record $237.0 billion. e last time the U.S. convenience store industry reported a decrease in in-store sales was 2002, when sales dropped 2.4 percent. Here are the overall merchandise sales groups as a percentage of overall merchandise sales (all c-stores): • Tobacco (cigarettes and OTP): 34.1 percent of in-store sales • Foodservice (prepared and commissary food; hot, cold and dispensed beverages): 22.5 percent continued on page 24

Midwest FOA Holds First General Meeting The Midwest FOA hosted its first general meeting in Troy, Michigan on Wednesday, March 28th with many attendees. Franchisee members heard presentations regarding I9 Compliance and Michigan Labor Laws, plus vendors presentations from Celsius, Hershey's and JimmyBar. Attorneys Sufen Hilf and Daniel Hilf—of Hilf &Hilf, PLC—presented on business practices for I9 compliance, including general tips to stay current with the proper documentation. Attorneys Matt Fedor and Clifford Hammond of Foster, Swift, Collins and Smith PC addressed topics such as hiring processes, federal vs. state labor laws (specific to Michigan), job postings, application and interview processes, and much, much more. Our next event in Michigan is scheduled for Wednesday, June 27th and we hope that more franchisees will be able to attend as we strive to provide educational seminars to benefit our members. For more information regarding the MWFOA, please contact (847) 999-5558. —Guliz Sonmez, Midwest FOA

By 2024, 70 percent of consumers will be grocery shopping online according to a new report by the Food Marketing Institute and Nielsen. The research predicts that consumer online food and beverage spending could reach $100 billion by 2025, which is equivalent to every U.S. household spending $850 for online groceries annually. • Dunkin’ Donuts recently announced that On-the-Go Mobile Ordering is now available through the Google Assistant on iPhones and Android phones. Though this new integration, DD Perks Rewards members can use Google’s voice assistant technology to place a mobile order for Dunkin’ Donuts items and then speed past the line in-store for pickup. • C-store retailer Sheetz recently announce plans to hire more than 2,500 employees company-wide.The company said the hiring initiative aims to increase Sheetz’s total employee count by creating and ﬁlling jobs at stores throughout Pennsylvania, West Virginia, Virginia, Maryland, Ohio and North Carolina. • Kohl’s is shrinking the floor plans of about a dozen of its larger department stores and will lease space to German discount grocer ALDI as part of a test to cut costs and drive more traﬃc to Kohl’s stores, reported USA Today. Kohl’s could also extend the test to include other grocers or other types of retailers. • Following its strategy to grow its core fuel distribution business, Sunoco LP recently announced it has purchased certain assets from Superior Plus Corporation for approximately $40 million.The assets consist of a network of approximately 100 dealers, several hundred commercial contracts and three terminals. • The trucking industry is facing a shortage of qualified drivers, with more items to deliver than ever before, reported Supermarket News. In 2017, the American Trucking Association predicted the trucking industry would experience the highest level of driver shortfall, and by 2026 the ATA estimates the shortage could swell to over 174,000 drivers. • Wawa, Inc. recently announced plans to launch its spring hiring campaign with the goal of hiring up to 5,000 new associates this year continued on page 36

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Legislative Update Coffee In California May Soon Carry Cancer Warning A preliminary decision from a California superior court judge in Los Angeles could force thousands of coffee shops—including Starbucks, 7-Eleven, McDonald’s and others—to put a cancer warning on coffee sold in the state, according to published reports. e nonprofit Council for Education and Research on Toxics sued some 90 coffee retailers in 2010 on grounds they were violating a California law requiring companies to warn consumers of chemicals in their products that could cause cancer. One of those chemicals is acrylamide, a byproduct of roasting coffee beans that is present in high levels in brewed coffee. e suit asked for damages and a label to warn consumers. e judge said in a decision dated March 28 that Starbucks and other companies had failed to show there was no significant risk from a carcinogen produced in the coffee roasting process, court documents showed. According to a report by CNN, at least 13 of the defendants had settled prior to this decision and agreed to give a warning.

McDonald's Settles Joint Employer Case McDonald’s recently agreed to settle a U.S. Labor Board case on whether the company is accountable for its franchisees’ alleged labor law violations, reported Reuters. e settlement, which must be “A U.S. Labor approved by a National Labor RelaBoard/McDonald’s tions Board judge, would allow Mccase that would have Donald’s to avoid a ruling that it is a made franchisors “joint employer” of workers at McDonald’s franchises and can be held liable more vulnerable to lawsuits from unions when franchisees violate federal labor law. McDonald’s did not admit to any representing franwrongdoing in the settlement, the chise workers has exact terms of which were not immedibeen settled.” ately clear. Business groups had said that a ruling against McDonald’s could upend the franchising model by making franchisors more vulnerable to lawsuits and requiring them to bargain with unions representing franchise workers. 18

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Union-backed worker advocacy group Fight for $15 filed dozens of legal claims on behalf of McDonald’s workers beginning in 2012. e group said workers across the United States were fired for taking part in protests calling for higher wages. Fight for $15 lawyer Micah Wissinger said the group would object to the proposed settlement.

Illinois Governor Opposes Raising Gas Taxes Illinois Governor Bruce Rauner opposes an increase in the state’s gas tax as a way to fund any infrastructure upgrades, but details on his plans for projects and how to fund them are light, reported the Journal Courier. e Illinois Chamber of Commerce and national transportation research group TRIP said half the roads in Illinois are in bad shape, and without repairs and improvements roads will get worse. Rauner said he’s proposing significant increases in infrastructure spending, and is asking lawmakers to approve money to pay interest on bond debt for such projects. e Illinois Petroleum Marketers Association and Illinois Association of Convenience Stores have long opposed any increase in the state’s gas tax. As it is, consumers near border communities go to neighboring states for cheaper gas, they said, and when consumers leave the state to buy gas they also buy other goods. Illinois taxed gasoline at 34.01 cents a gallon in 2017, which is more than Missouri (17.3 cents a gallon), Kentucky (26 cents) and Indiana (33.6 cents).

Florida Bills Exclude Soda From SNAP Benefits Two bills—SM 1016 and HM 847—were recently introduced in the Florida legislature that would make Supplemental Nutrition Assistance Program benefits unavailable for so drinks purchase, reported WUFT-FM. Both bills were introduced on January 9, 2018 but have not moved in either the Florida Senate or House of Representatives since then. If signed, the legislative initiatives could aﬀect Florida families and businesses, as well as the soda industry. Allowing the government to designate foods as “good” and “bad” would create a food code more complicated than the tax code and grow government bureaucracy without saving tax dollars, the Florida Beverage Association said. continued on page 20

www.ncasef.com

Legislative Update Maryland Bill Would Raise Smoking Age To 21 A bill in the Maryland legislature seeks to raise the tobacco sales age from 18 to 21, reported WBAL TV. House Bill 953 has strong support from a number of health groups like the American Lung Association and the American Cancer Society. It's hoped that by raising the age, it will help cut down on what they call a major part of the smoking “FIVE STATES AND MORE THAN 250 CITIES market: middleAND COUNTIES ACROSS THE COUNTRY and high-schoolHAVE ENACTED LEGISLATION TO RAISE age students. OpTHEIR SMOKING AGE TO 21.” ponents of the bill

said it should be a person's right to figure out whether they should smoke or not, and that when a person turns 18, they can make their own decisions. Five states and more than 250 cities and counties across the country have already enacted similar legislation.

Arizona Outlaws Taxes On Sugary Drinks Arizona Governor Doug Ducey recently signed a bill into law that prevents cities and counties from taxing soda and sweet drinks, reported KGUN9-TV. It is the first bill of its kind in the country and is generating some debate. e law, also known as the “soda tax,” bars cities, towns, and counties from

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applying extra taxes on the drinks. Representatives of grocery stores in the state support the new law. Some agree the government should not use tax rates to “pick winners and losers in foods and beverages we consume every day,” a spokesperson with the Arizona “Arizona’s Food Marketing Alliance said in a governor has statement. Many cities across the U.S. signed a bill have adopted the “soda tax” to reduce into law that obesity and other health prevents cities issues. ere is curand counties rently no sign of any city in Arizona confrom taxing sidering imposing soda and sugar taxes on soda. sweet drinks.”

FDA To Consider What ‘Healthy' Means e Food and Drug Administration plans to explore what it means for food products to be considered healthy and may create an icon or symbol to label those that meet the possible new definition, reported CNBC. In addition to implementing Obama-era updates to nutrition labels, the FDA will also consider what health claims food products can make and how manufacturers can list ingredients. It also may make definitions of some foods more flexible and may reduce sodium, according to the report. e agency is also exploring whether it should go beyond promoting specific nutrients to include food groups Americans tend not to eat enough of, continued on page 62

www.ncasef.com

Come One, Come All To Celebrate Franchisee Unity!

Online registration to the NCASEF 43rd Annual Convention & Trade Show is now open for franchisees and vendors! Running from July 23 to 26 at the luxurious Gaylord Palms Resort and Convention Center in Orlando Florida, this stellar event includes free tickets to Universal Studios, great seminars, a blowout trade show featuring great new products and deals from our valued vendor, a 2018 BMW 320i raffle giveaway and other fabulous prizes, and many social events sprinkled in between!

Schedule of Events

Franchisees: Enjoy a low registration fee of $49 per person and hotel rate of $99 per night!

7:00 p.m. – 9:00 p.m. Opening Reception With Live Music and Hors d’Oeuvres Location: Sun Ballroom

Vendors: Increase sales with your 7-Eleven customers and network with the largest c-store buying group in the country! Sign up as a Major Sponsor for more exposure throughout the convention!

Visit NCASEF.com and sign up today!

MONDAY, JULY 23

WEDNESDAY, JULY 25

12:00 p.m. – 5:00 p.m. Franchisee and Vendor Registration Location: Sun Ballroom Foyer

8:00 a.m. – 9:00 a.m. Continental Breakfast Location: Sun Ballroom

TUESDAY, JULY 24

7:00 p.m. – 11:00 p.m. Charity Night Gala Cocktail Reception, Silent and Live Auctions, Dinner, DJ Entertainment Location: Sun Ballroom AVA N T I M A R C H | A P R I L 2 0 1 8

10:00 a.m. – 11:00 a.m. Vendor Panel Location: Sun Ballroom

9:00 a.m. – 5:00 p.m. Franchisee and Vendor 11:00 a.m. – 4:00 p.m. Registration Location: Sun Ballroom Foyer “Franchisees ARE the Brand” Trade Show 8:00 a.m. – 9:00 a.m. Participate to receive entries Continental Breakfast to the multi-prize raffle, Location: Sun Ballroom including the BMW 320i 8:00 a.m. – 5:00 p.m. grand prize giveaway! Trade Show Vendor Setup Location: Exhibit Halls A/B Location: Exhibit Halls A/B 9:00 a.m. – 6:00 p.m. A Day at Universal Studios

9:00 a.m. – 10:00 a.m. State of the Coalition Address Jay Singh, Chairman, NCASEF and Executive Officers

THURSDAY, JULY 26 8:00 a.m. – 9:00 a.m. Continental Breakfast Location: Sun Ballroom 9:00 a.m. – 1:00 p.m. Franchisee and Vendor Registration Location: Sun Ballroom Foyer

9:00 a.m. – 10:00 a.m. Department of Homeland Security Presentation I-9 Compliance and Hiring Location: Sun Ballroom 10:00 a.m. – 11:00 a.m. Legal Forum with NCASEF General Counsel Eric Karp Location: Sun Ballroom 11:00 a.m. – 4:00 p.m. “Franchisees ARE the Brand” Trade Show Participate to receive entries to the multi-prize raffle, including the BMW 320i grand prize giveaway! Location: Exhibit Halls A/B 6:00 p.m. – 7:00 p.m. Cocktail Reception Location: Sun Ballroom 7:00 p.m. – 10:00 p.m. Grand Banquet Raffle Grand Prize Winners To Be Announced! Location: Sun Ballroom

• Packaged beverages (carbonated so drinks, energy drinks, sports drinks, water, juices and teas): 15.8 percent • Center of the store (salty, candy, packaged sweet snacks and alternative snacks): 9.9 percent • Beer: 8.5 percent (12.4 percent for stores selling beer) • Other: 9.2 percent

www.ncasef.com

Seven & I Record Profit On U.S. Growth

Seven & I Holdings expects operating profit to rise 6 percent in the year through February to reach a record high, as its U.S. convenience store business helps oﬀset cooling sales in Japan, reported Reuters. With Seven & I approaching “e last time the U.S. convenience store 10,000 c-stores in the United industry reported a decrease in in-store sales States, the comwas 2002, when sales dropped 2.4 percent.” pany is increas-

ingly banking on the U.S. for growth as fears rise that its domestic business is running out of steam. Seven & I announced operating profit that rose 7.4 percent to 391.7 billion yen in the year just ended, boosted by growth in the U.S. e company said its domestic convenience store business saw operating profit rise 0.6 percent from a year earlier. e U.S. unit posted a 17.3 percent rise. It also said it would more than double capital expenditures in the year to 778.4 billion yen, allocating 480 billion yen to the overseas convenience store business and 167.5 billion yen to the domestic chain. continued on page 54

FUN AND SALES AT THE FOAGLA/ SAN DIEGO FOA TRADE SHOW The FOA of Greater Los Angeles and San Diego FOA held their annual joint trade show on March 7, 2018 at the Pechanga Resort and Casino in Temecula, California. Franchisees from both organizations crowded the trade show floor to view the latest products and deals the exhibiting vendors had to offer. The event also featured a raffle with a grand prize car giveaway of a Chevy Cruz, which was won by FOAGLA franchisee Raji Najjar.

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The Remaking Of A Coalition BY JAY SINGH, CHAIRMAN, NCASEF

Many franchisees have called the National Coalition office for an update on the independent contractor lawsuit. Here are the details. On October 12, 2017, a 54-page classaction complaint was filed in the United States District Court for the Central District of California, Western Division, alleging that 7-Eleven, Inc. (SEI) is in violation of the Federal Labor Standards Act and California employment laws in connection with its administration of our convenience store system. The docket number is 2:17-CV-7454. The designated and proposed class representatives were four courageous California franchisees: Serge Haitayan, Jaspreet Dhillon, Robert Elkins, and Maninder “Paul” Lobana. The complaint sought money damages, restitution and other relief. The central basis of the complaint is that while SEI promises to franchisees and represents to them that they are and will be independent contractors, they are in fact treated as employees. Over time, SEI has been gradually chipping away at the profits of franchisees, increasing their costs, exercising more and more control over what is supposed to be an independently operated convenience store, where franchisees control the manner and the means of the operation of the location. On March 20, 2018, the court dismissed the case, finding in part that the control exercised by SEI was no more than was necessary to protect the goodwill behind its brand. Shortly thereafter, SEI requested that the court issue an order requiring the plaintiffs to reimburse SEI for out-of-pocket costs associated with the lawsuit to that date, principally the cost JAY SINGH CAN BE REACHED AT of deposition tran702-249-3301 OR scripts. As of the JAYS@NCASEF.COM date of this writing,

“On March 20, 2018 the court dismissed the classaction complaint alleging 7-Eleven was in violation of the Federal Labor Standards Act and California employment laws.” the court had not decided whether to assess those costs and if so, in what amounts. SEI filed no request for reimbursement of its legal fees. Because counsels of record in the case believe that the dismissal of the case was wrong on the facts and wrong on the law, the judgment dismissing the case was ap-

pealed to the United States Circuit Court of Appeal for the Ninth Circuit on April 9, 2018. The appeal has been docketed and the brief of the plaintiff franchisees must be filed by July 18, 2018, with SEI’s brief due 30 days later. On the appeal, the plaintiff franare rep“The central basis chisees resented by of the complaint Shannon Lisswas that SEI treats Riordan, of Boston, Massafranchisees as chusetts. employees, yet These are the promises and rep- facts behind resents to them that the lawsuit. they are independ- There is much, much more to ent contractors.”

the case, and to the sacrifice these franchisees and the Coalition made to try and improve the lot of all franchisees who are losing ground contractually to our franchisor with each consecutive contract, and each hike in minimum wage. The entire National Coalition Board of Directors voted unanimously, more than once, to move forward with this lawsuit, and these votes reflect the status of franchisees and franchisee morale during this period prior to the distribution of the new 2019 Agreement. Now we must regroup and move forward with the business of running our stores and running the National Coalition. So here we go. The National Coalition is throwing a great franchisee convention July 23-26 at the famed Gaylord Palms Resort and Convention Center in Orlando, Florida, just minutes from Universal Studios and Walt Disney World. Our website, www.NCASEF.com is open and ready NOW for franchisee and exhibitor/vendor registration. To give our hardworking franchisees a break on the money, we’re working extra-hard on fundraising to subsidize a $49 franchisee registration fee, and a $99 hotel rate for franchisees at this usually $300 per night hotel. This is the first time in history the NCASEF has lowered the price of registration, and it is the lowest convention registration rate the National continued on page 30

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The Remaking Of A Coalition continued from page 29

Coalition has offered in recent memory, down from $149 in the past. For our trade show we’re expecting at least 300 booths and great show deals from our valued vendors who provide the great products for us to sell in our stores. Where else can you find so many recommended and non-recommended vendors together who are all pitching products to their favorite customers, 7-Eleven franchisees? We’ve put together three informational seminars—“State of the National Coalition,” “I-9 Forms And Hiring Proce-

dures With The Department Of Homeland Security,” and “The Legal Forum” with NCASEF’s General Counsel Eric Karp—to keep everyone informed, legal, and knowledgeable about the Coalition. We’ve also added a new feature, a vendor panel featuring our major sponsoring vendors. For the fun stuff we’re got a 2018 BMW 320i to give away as the grand prize at the Grand Banquet, a day at Universal Studios (included with registration), and our annual Charity Night Gala International Buffet with profits going to Swim Across America and a “The judgment dismissing the case was appealed to the United local yet-to-be picked charity. States Circuit Court of Appeal for the Ninth Circuit on April 9, It’s going to be 2018. The plaintiff franchisees are represented by Shannon a great event, Liss-Riordan, of Boston, Massachusetts on the appeal.” one where you

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“Now we must regroup and move forward with the business of running our stores and running the National Coalition.” can celebrate and party with friends, family and colleagues, as well as our vendor partners and all of their wonderful products. Join us as we move into the next phase of franchisee development, and please come to let us know what more the National Coalition can do to serve the best interests of franchisees on the eve of the impending 2019 Agreement. So visit the website, www.NCASEF .com, for all the details, and tell your friends. This is the time for franchisee unity, and we need every voice..

The Thought Behind The Convention Theme BY MICHAEL JORGENSEN, EXECUTIVE VICE CHAIRMAN, NCASEF

This year’s NCASEF Annual Convention theme is “Franchisees ARE The Brand.” There is no doubt that 7Eleven is one of the most recognizable brand names in the world with over 66,000 locations in 17 countries. This theme was not designed in any way to detract from the brand, but some have questioned that this is a bold statement that may upset 7-Eleven corporate leadership. I respectfully disagree. The truth is that FRANCHISEES—not one individual franchisee—are the brand, and no one knows this better than the leadership at SEI. The theme should be a reminder to everyone, both corporate and franchisee, of our significance in building and maintaining the brand and brand image. Let’s first break down the definition of “brand.” The Economic Times defines a brand as a name given to a product and/or service that takes on an identity by itself. There is, however, a difference between a “brand name” and a “brand.” In a 2011 Forbes article titled “What is a Brand, Anyway?” Jerry McLaughlin says, “A brand is simply what your prospect thinks of when he or she hears your brand name.” He goes on to state, “It’s everything the public thinks it knows about your name brand offering—both factual, and emotional. Your brand name exists objectively; people can see it. It’s fixed. But your brand exists only in someone’s mind.” In its description of brand, the Economic Times further elaborates that, “A brand is akin

MICHAEL JORGENSEN CAN BE REACHED AT

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

to a living being, having an identity and personality, name, culture, vision, emotion and intelligence. All these are conferred by the owner of the brand and need to be continuously looked at to keep the brand relevant to the target it intends to sell to.” When looking at all of the information regarding exactly what a brand is, it should be clear that as the store op-

erators, franchisees are the face of the 7-Eleven brand to the public. Therefore “Franchisees ARE the Brand.”

ship. The Project A Game program, a perfect example of this effort, is designed to further build brand awareness, brand loyalty and greater customer engagement, but it can only be successful with the involvement of the franchise community. The relationship franchisees have with 7-Eleven Inc. is a mutually symbiotic relationship, one that benefits both parties. A perfect analogy of a mutually symbiotic relationship, although one in a biological sense, is that of the clownfish and the sea anemone. Each is highly dependent on the other for survival; they share nutrients and benefit from mutual protection from predators. The sea anemone’s

“Our convention theme, ‘Franchisees ARE The Brand’ should be a reminder to everyone, both corporate and franchisee, of franchisees’ significance in building and maintaining the 7-Eleven brand and brand image.” Symbiosis is defined as a mutually beneficial relationship between different people or groups. 7-Eleven acknowledges that franchisees already have symbiotic relationships with their communities and is investing together with franchisees to further this relation-

tentacles sting and kill any other species, but the clownfish produces a mucus coat that prevents it from getting stung. This allows the clownfish to live within the safe confines of the anemone and avoid exposure to predators. Besides working to further the relationship continued on page 34 AVANTI M A R C H | A P R I L 2 0 1 8

The Thought Behind The Convention Theme continued from page 33

within the communities, 7-Eleven has also engaged franchisees in lobbying efforts to benefit our business interests. Recent examples include swipe fee reform and proposed changes to SNAP. The National Coalition’s bylaws state that part of the organization’s purpose is to coordinate the “Since October there efforts of FOAs has been no direct to attain a social and economic communication framework that between NCASEF leadership and SEI will enhance c o nv e n i e n c e leadership, even store franchisfollowing the March ing, serve the 14 dismissal of the public and proCalifornia litigation.” vide fairness

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and justice for 7-Eleven convenience store franchisees. The National Coalition and FOAs across the country have worked with charitable organizations for more than 40 years. We have given MDA over $82 million through dona-

tions and canister programs, and more recently we have raised approximately $70,000 per year at our convention for Swim Across America and St. Jude Children’s Research hospital. Several years ago we organized a cause equity program that raised approximately

$732,000 for Hire Heroes USA. Our 43 regional FOAs also regularly donate to local chairities, including MDA, local hospitals, Susan B. Komen, police organizations and victims of floods and hurricanes. We have worked hard to give back to our communities and build goodwill in the name of the 7Eleven Brand. Since October there has been no direct communication between NCASEF leadership and SEI leadership, even following the March 14 dismissal of the California litigation. 7-Eleven’s focus following the dismissal instead appears to be an attempt to undermine and weaken the NCASEF, the FOAs and their leadership. There is continued on page 36

The Thought Behind The Convention Theme continued from page 34

also talk that, much like the revamping of the NBLC and various SEI committees, there are plans to create or support alternate FOA bodies and even an alternate National Coalition. This strategy is not going to get us closer to the place we need to be. Even if successful in some areas, the simple fact is it will push franchisees and SEI further apart and cause more lasting damage. In a May 2008 article for Franchising World titled “Commonsense Steps that Franchise Systems Often Fail to Apply,” Mary Brody points out that “for an advisory council to be effective, it must have meaningful input on the issues and must be recognized by the general franchise population as representing franchisee interests. Some franchisors set up a franchisee advisory council consisting of handpicked franchisor favorites whom the franchisor expects to rubber-stamp its decisions. This type of council probably does more harm than good. Regardless of the form franchisee input takes, it will not be effective unless franchisees feel empowered to participate in the pres-

“We need to get to a place where franchise leadership can again speak honestly to SEI senior management about the concerns of the franchise community and work together to find solutions to move the system forward.” ent and future direction of the franchise system.” Why recreate the anemone? NCASEF and FOA leaders have been elected by franchisee members to represent them and their concerns, and to be their voice. Many of these leaders are chosen due to their ability to not only communicate issues and obstacles, but also for their ability to find solutions. We need to get to a place where franchisees and SEI can once again have a mutually symbiotic relationship. We need to get to a place where franchise leadership can again speak honestly to SEI senior management about the concerns of the franchise community and work together to find solutions to move the system forward. The National Coalition and FOAs, even if not always agreeable to SEI, should be seen as necessary to the health of the 7Eleven system. This is beneficial to the brand, because “Franchisees ARE The Brand.” We are also the clownfish, mucus coat and all.

“7-Eleven’s focus following the dismissal appears to be an attempt to undermine and weaken the NCASEF, the FOAs and their leadership. This strategy, even if successful in some areas, will push franchisees and SEI further apart and cause even more lasting damage.” 36

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by June, with all of Wawa’s 790 stores across its six-state operating area looking to fill customer-service and managementlevel positions. • The merger of supermarket chain Albertsons and Rite Aid recently took another step forward with the expiration of the Hart-Scott-Rodino waiting period for the $24 billion deal, reported Supermarket News. The transaction is expected to close early in the second half of 2018. • Walmart is supposedly in talks to acquire health insurance provider Humana, reported Business Insider. Much like CVS Health’s $69 billion takeover of insurance giant Aetna, the move is a way for Walmart to gain more leverage over drug makers and medical device companies as costs rise. • The Kroger Co. recently announced that its family of stores is hiring to fill an estimated 11,000 positions in its supermarket divisions, including nearly 2,000 management positions. In addition to job creation, the company said it is investing $500 million in associate wages, training and development over the next three years, as part of its Restock Kroger program. • Coca-Cola is testing Internet of Things (IoT)-connected vending machines in c-stores and retail outlets in Chicago and Dallas, reported NACS Online. These “smart” machines will accept cashless payments, track product inventory and monitor efficiency with the goal of increasing sales. • Actionmovie star and former California Gov. Arnold Schwarzenegger said he’s planning legal action against oil companies for “knowingly killing people all over the world,” reported SFGate.com. He said the oil companies knew since 1959 there would be global warming because of fossil fuels, and that it would be risky for people’s lives. • Bottled water remains one of the strongest performing sectors of the global non-alcoholic drinks market, with retail sales volume in key global markets climbing by 6.5 percent between 2016 and 2017 to reach an estimated 203 billion liters, according to a new Mintel report. The U.S. is currently the largest bottled water market, with volumes forecast to reach 39 billion liters in 2017. • Target is testing a new loyalty program dubbed Target Red in the Dallas-Fort Worth market to gauge demand for loyalty benefits that aren’t tied to a credit or debit card, recontinued on page 42

7-ElevenNOW Program Amendment— More Questions Than Answers ERIC H. KARP, ESQ., GENERAL COUNSEL TO NCASEF

SEI has rolled out a new 7-ElevenNOW Program Amendment that purports to allow franchisees the opportunity to fulfill orders placed on the 7-ElevenNOW App. The Amendment is in the process of being offered to existing franchisees. It also appears on pages F-129 to F-131 of Exhibit F to SEI’s 2018 franchise disclosure document issued on April 5, 2018. There is also a related Delivery Services Amendment that appears on pages F-127-128 of the same disclosure document. The entire franchise disclosure document can be found on the website of the Wisconsin Department of Financial Institutions: https://www.wdfi.org/fi/securities/franchise/default.htm This is how SEI described the 7ElevenNOW App in a press release issued last December: “When ordering items through 7-ElevenNOW, 7-Eleven customers can choose to receive direct delivery to their location or pick up their prepared order at the participating store of their choice within the 7ElevenNOW footprint. A wide selection of snacks, cosmetics, gift cards, home goods, beverages and hundreds of other products are available for purchase on the app, making 7Eleven the go-to place in order to get everything customers may need all from one location.”

Like many similar amendments to the franchise agreement, and consistent with SEI’s treatment of the supply chain with a certain level of secrecy, this 7ElevenNOW Program Amendment is extremely opaque and raises many more questions than it answers. The franchise disclosure document, of which the 7-ElevenNOW Program Amendment is a part, is designed not just to comply with federal and state franchise disclosure rules, but more

specifically to fulfill the public policy behind those rules, which is to give prospective franchisees sufficient information to make a knowing and intelligent choice whether to execute the franchise agreement and its various amendments. Applying that standard, the 7-ElevenNOW Program Amendment falls short.

“Like many similar amendments to the franchise agreement, the 7-ElevenNow Program Amendment is extremely opaque and raises many more questions than it answers.”

“A new 7-ElevenNow Program Amendment purports to allow franchisees the opportunity to fulfill orders placed on the 7-ElevenNow App.” In the end, SEI is asking franchisees to sign this document in the dark, without understanding its basic implications for franchisee revenue, gross margin, net profit and equity. SEI is asking franchisees to trust them, but there is no evidence that the company has earned that trust. A good beginning would be to introduce some refreshing transparency with respect to this 7-ElevenNOW Program Amendment. One might ask, what exactly would SEI be risking by doing so? Here are 60 questions that any franchisee should have the answers to before they are compelled or pressured into signing the 7-ElevenNOW Program Amendment:

Delivery Providers 1. How will these orders be accounted for in the Financial Summaries? 2. Who are the third party delivery companies (Delivery Providers)? 3. The Amendment states that franchisees may not use any other delivery company, even for orders not placed through the App. What is the purpose of continued on page 40 AVANTI M A R C H | A P R I L 2 0 1 8

7-ElevenNOW Program Amendment— More Questions Than Answers continued from page 39

this harsh restriction and why does it exist? 4. Do the Delivery Providers have adequate personnel, infrastructure and resources to carry out their responsibilities? 5. The Delivery Amendment indicates that the delivery fee will be up to 10 percent, but who decides the actual amount that will be paid to the Delivery Providers? 6. Will customers be asked to pay all or a portion of the Delivery Fee? 7. Who decides whether customers will be asked to share in the cost of the Delivery Fee? 8. What impact will the fees of the Delivery Providers have on gross margin? 9. Will corporate stores pay the same Delivery Fee as franchise stores? 10. Will SEI pledge to never receive payments, commissions, kickbacks or other consideration from the Delivery Providers in return for the privilege of deriving revenue from the system? If not, why not? 11. Will SEI provide to the National Coalition copies of their contracts and agreements with the Delivery Providers? If not, why not?

Payment Processors 12. Who are the payment processing companies (Payment Processors) that have been retained by SEI?

“SEI is asking franchisees to sign this document in the dark, without understanding its basic implications for franchisee revenue, gross margin, net profit and equity.” 40

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13. Do the Payment Processors have adequate personnel, infrastructure and resources to carry out their responsibilities? 14. What are the fees that will be paid to the Payment Processors? 15. How will these fees be computed? 16. The 7-ElevenNOW Program Amendment warns that the fees paid to the Payment Processors may be higher than those paid under the current payment card processing arrangement. How much higher will they be? 17. Will those fees be included in the definition of Gross Profit? 18. What impact will the fees of the Payment Processors have on gross margin or net profit? 19. Will corporate stores pay the same fees to the Payment Processors as franchise stores? 20. Will SEI pledge never to receive payments, commissions, kickbacks or other consideration from the Payment Processors in return for the privilege of deriving revenue from the system? If not, why not? 21. Will SEI provide to the National Coalition copies of their contracts and agreements with the Payment Processors? If not, why not?

Special Proprietary Containers 22. Franchisees will be required to order and maintain “adequate” supplies of Special Proprietary Containers. What is the definition of an adequate supply? 23. How will franchisee performance against that standard be measured? 24. From whom will franchisees be required to order Special Proprietary Containers?

25. Will SEI shoulder the risk and the responsibility if the Special Proprietary Containers are not adequate for their intended purposes? 26. To what extent will the Special Proprietary Containers be more expensive than standard packaging? 27. Will SEI pledge to never receive payments, commissions, kickbacks or other consideration from suppliers of Special Proprietary Containers in return for the privilege of deriving revenue from the system? If not, why not? 28. Will SEI provide to the National Coalition copies of their contracts and agreements with suppliers of Special Proprietary Containers? If not, why not?

New Equipment 29. What new equipment will SEI be installing for holding hot and cold foods? 30. Will the equipment be new, and not reconditioned? 31. What are the manufacturers’ warranties with respect to this equipment? 32. Will franchisees see the benefit of these warranties? 33. What is the expected useful life of this equipment? 34. What is the anticipated cost of the franchisee’s equipment maintenance responsibility with respect to this equipment? The App 35. What company or companies will be responsible for maintaining the App? 36. Do these companies have adequate personnel, infrastructure and resources continued on page 42

7-ElevenNOW Program Amendment— More Questions Than Answers continued from page 40

to carry out their responsibilities? 37. What costs, if any, will franchisees incur in connection with the App? 38. What costs, if any, will franchisees incur maintaining the store online? 39. How will customers earn points for ordering on the App? 40. Who pays for the cost of redeeming these points? 41. How will those costs be accounted for and in what format? 42. What percentage of stores are online now?

51. Has SEI studied what parts of the day orders are likely to be received? If not, why not? 52. What impact does SEI expect that incremental write-offs will have on franchisee profit? 53. To what extent will incremental orders fulfilled through the App elevate franchisee exposure to write-offs? 54. Has SEI studied the issue of incremental write-offs that may be generated by the need to maintain adequate inventory to fulfill these orders? If not, why not?

Incremental Labor Costs 43. Franchisees have long been concerned about the incremental labor associated with fresh foods and hot foods. How much incremental labor is expected to be incurred in connection with the fulfillment of orders placed through the App? 44. Will the incremental labor costs be incurred at higher rates than for fresh food and hot foods sold to walk-in customers? 45. Will the incremental labor costs be incurred at different times of the day than for fresh food and hot foods sold to walkin customers? 46. How will this incremental labor affect franchisee’s bottom line? 47. Has SEI studied the issue of incremental labor that has been required so far, or will be required in the future in order to fulfill these responsibilities? If not, why not? 48. Franchisees will be required to maintain “adequate” inventories of hot and fresh foods to fill all orders. What is the definition of an adequate inventory? 49. How will franchisee performance against that standard be measured? 50. Does SEI anticipate that the App will result in elevated required inventory of fresh foods and hot foods at different parts of the day than in-store sales?

Retail Prices 55. Who will set the retail prices at which orders can be placed through the App? 56. Will franchisees be permitted to set retail prices as required by the terms of their franchise agreements? 57. To what extent will special promotions and/or discounts be more prevalent through the App than they are in a retail store? Order Fulfillment 58. Has SEI studied the issue of pricing through the App and the impact that it may have on the bottom line of franchisees? If not, why not? 59. Franchisees will be required to process orders “as soon as possible,” “promptly” and in a “timely manner.” What are the definitions of these terms? 60. How will franchisee performance against these standards be measured? We ask that SEI probably respond in writing and in detail to each of these questions so that franchisees can make an informed decision as to whether or not to execute the 7-ElevenNOW Program Amendment and the Delivery ERIC H. KARP CAN BE REACHED AT Services Amend617-423-7250 ment.

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ekarp@wkwrlaw.com

continued from page 36

ported the Dallas Morning News. Shoppers who sign up via the retailer’s mobile app earn 1 percent cash back on purchases, free next-day delivery on Target Restock purchases and discounted Shipt membership. • McDonald’s recently announced it plans to reduce greenhouse gas emissions related to McDonald’s restaurants and offices by 36 percent by 2030 from a 2015 base year in a new strategy to address global climate change. • Amazon is working on reorganizing Whole Foods shelves by first adding Amazon private label products and may add popular consumer packaged goods like Coca-Cola, reported Yahoo Finance. However, the plan of bringing in consumer packaged goods still faces obstacles from Whole Foods, according to sources. • The inventor of Blue Moon beer is launching three marijuanainfused drinks that promise intoxication without the alcoholic headache, reported USA Today. • Ford Motor Co., which is focusing its entry into the driverless-car business on aroundtown deliveries, has picked Florida’s MiamiDade County as its first test-bed, reported the Wall Street Journal. The delivery vehicles will be dropping off for Domino’s Pizza Inc. and for food-delivery service Postmates. Ford expects to add other partners later. • In a move to capitalize on the popularity of organic food and beverages, Anheuser-Busch InBev has introduced a new beer in the U.S. called Michelob Ultra Pure Gold that’s made with organic grains and approved by the Sustainable Forestry Initiative, reported Bloomberg. • As of April, all major credit card companies stopped requiring a signature for purchases made with a card that uses a security chip, reported Fox News. The change has gradually been phased in since the chip system—which is considered more secure than cards using magnetic strips—was introduced in the U.S. about two years ago. • Dollar General expanded maternity leave and adoption assistance for all 130,000 of its employees beginning April 1, reported USA Today. New birth mothers now qualify for up to eight weeks of paid leave, and employees trying to adopt a child receive up to $4,000 in assistance. • Millennials who lived through the Great continued on page 56

Vice Chairs’ Forum

UNMASKING THE ELUSIVE SSI AND NRI BY NICK BHULLAR VICE CHAIRMAN, NCASEF

The 7-Eleven franchise process is mended product” status, and not all ven- “A STORE SUPPORTED unique: approximately a 50-50 gross dors with good products are accepted by ITEM (SSI) IS A profit split between the franchisor and the category managers at 7-Eleven. AcNON-RECOMMENDED franchisee. (Actually this can vary to as cording to NACS, several hundreds of ITEM FROM A RECOMhigh as 56-44 depending on the volume new products enter the c-store pipeline MENDED VENDOR FOR of the store). Franchisees own the inven- every year. Some companies are too new, THE STORE.” tory and hire and manage the employees. or they are small and local, and can’t get 7-Eleven controls the lease on the build- the endorsement of the company. Yet sive Store Supported Item (SSI) and the ing, creates the “system” franchisees have some of these products can be very good elusive Non-Recommended Item (NRI). to follow (contractually), and specifies selling items that we want and need in our A Store Supported Item (SSI) is a non-recstores, and if we wait for them to become ommended item from a recommended and controls all the equipment. Under this system, franchisees have recommended, we’ve lost the opportunity. vendor for the store. For example, if a 7-Eleven category managers work major soda company has 40 products to purchase 85 percent of their goods and services from “recommended ven- very hard to categorize, evaluate and available for sale, but only 18 of them are dors” and have 15 percent leeway to cus- specify which products will be recom- recommended in the 7-Eleven system, the tomize their stores. How does a vendor mended, but nothing’s perfect. Some- other 12 items are non-recommended. If achieve this vaulted “recommended ven- times it takes months for a hot product a franchisee knows that two of those items dor” status? By having their will sell like hotcakes in their store, he product(s) become recommended or she can set those items up in their orproduct(s) in the 7-Eleven system. dering system as SSIs, non-recomOnce products are recommended, a mended items from a recommended whole host of advantages kick in: recvendor. Almost every item in McLane ommended vendor status, freight on can be handled this way because our board guaranteed at McLane, SLIN major distributor is set up as a recomnumbers assigned that make the mended vendor. The item will then be product easier to find in treated like a recommended the ordering system, item in our POS system, “An NRI is a non-recommended item promotions with 7and it can be scanned and Eleven, and the simple from a non-recommended vendor.” ordered like any recomfact that the product has mended product. Within been endorsed by corporate and the cat- to come to the attention of the category two weeks that item will become like any egory manager believes the product will manager. It takes time for the company other recommended product for that to meet with the manager in Dallas, for store. succeed in our stores. Not all prod- SLINs and UINs to be assigned, and for NRIs are a bit different. An NRI is a a First Order Date to be set up, at which ucts, even those non-recommended item from a nonNICK BHULLAR CAN BE REACHED AT from recom- time franchisees can order the product recommended vendor. These items are bhullar711@yahoo.com mended vendors, through the system. often local items from local companies, or 626-255-8555 What’s the alternative? Enter the elucan get “recomcontinued on page 48 AVANTI M A R C H | A P R I L 2 0 1 8

Vice Vice ’ ’ Chairs Chairs Forum Forum continued from page 45

or items from companies that have been turned down by the category managers in Dallas. They can be hot selling items from companies that may not ever have recommended items. Take Spinners for example. Spinners were so hot on the American scene that franchisees were looking to buy from any source available anywhere, and we could bring them in as NRIs and make good money on the opportunity. NRIs would be part of the 15 percent of products that franchisees can order that don’t have to be recommended by Dallas. The good news for vendors is if their NRIs sell well, they can package the results and go (or return) to

“USING THESE TWO METHODS—SSIs AND NRIs—SEI HAS GIVEN FRANCHISEES THE ABILITY TO ORDER ALMOST ANY CONCEIVABLE ITEM THAT VENDORS CAN IMAGINE.” the category manager in Dallas and have a better chance of becoming a recommended vendor. Using these two methods—SSIs and NRIs—SEI has given franchisees the

HOW TO ORDER SSIs AND NRIs Sales data for NRIs are available only from the Non-Recommended Item Sales screen. A list of recommended vendors are available from the #2 Vendor box dropdown screen in the Item Setup section. Sales data for SSIs will be available just like Recommended Items, in the ABC Analysis section.

Basic set up of a NRI in the ISP: 1. Click “Item Setup” in Product Assortment Screen (Screenshot #1). 2. Scan the UPC code of the item that is to be set up in the “1. UPC” box. 3. Type in name of the item in the “3. Item Name” box (Screenshot #2). 4. Verify that “Retail” is selected in the “4. Item Type” box. 5. Select the department of the item in the “5. Department” box. 6. Select the category of the item in the “6. PSA” box. 7. Select “No” for an item that is sold in single units in the “7. Will this Item be sold as a multipack?” box. 8. Input the cost of the item in the “8. Item/Case Cost” box. If item has a deposit for container, input amount (0.05 or 0.10) in the “Deposit” box. 9. Input amounts for Retail Price, Lowest Delivery Unit (LDU), Retail Size, and Retail Unit Of Measure. 10. Select OK to finish the set up of the item. 48

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ability to order almost any conceivable item that vendors can imagine. This is especially useful for many stores—say you have a big Irish clientele, and you want a full display of Irish candy. Or you have a large Hispanic customer base, and you need a large number of Hispanic foods or alcoholic beverages in your store. In these situations, SSIs and NRIs are tremendously useful. Franchisees often share information about these products, because if a product is selling well in one store, it might sell extremely well in another store too…and we like to share with our friends.

Vice Chairs’ Forum

WHY IS OUR CUSTOMER COUNT DECLINING? BY ROMY SINGH VICE CHAIRMAN, NCASEF | PRESIDENT, EASTERN VIRGINIA FOA

The U.S. convenience store count increased to a record high of 154,958 stores as of year-end December 31, 2017, resulting in 423 additional stores and 0.3 percent increase year-over-year, according to the 2018 NACS/Nielsen Convenience Store Count data. Currently, every company is looking to expand their c-store business across the country. Neilson projects the strength and growth of c-stores will continue. However, this is not guaranteed due to the advancement of technology,

Another reason for our declining customer count is that we are lacking a rewards program for our fuel stores. Our competitors are offering fuel rewards programs that, for example, give their customers 5-10 cents off per gallon of gas for every $50-$100 they spend on groceries. I believe if we offer a fuel rewards program we will attract more customers inside of our stores.

“THERE ARE MANY FACTORS ON WHY WE CONTINUE TO LOSE CUSTOMERS TO OUR COMPETITORS, EVEN THOUGH WE HAVE BETTER PRICES IN COMPARISON TO BIG BOX GROCERY STORES.” The physical plant and store image growth of e-commerce, and competiis another significant reason for the detion through diversified channels. There are many factors on why we crease in customer count. Most of our continue to lose customers to our com- stores’ physical image seems to look like petitors, even though we have better prices they are from the 1960s, and not like in comparison to big box grocery stores 2018. We need a new image that is modand we have attempted to draw customers ern and more attractive to millennials through discounted prices, such as the 50 and to our core demographics. In addition, our revenue-generating cents coffee. One factor is that our current franchise model puts extra burden on the equipment being constantly down confranchisee, such as with payroll. Wages tributes to our declining customer continue to increase every year, which are counts. The equipment continues to directly impacting our customer service. wear and tear, break down, and someThe impact can be seen even at the cor- times results in a week to fix due to servporate stores. Franchisees cannot afford “In our stores we ice providers not having the proper labor due to increased wages. have different parts on hand. Our competitors are taking advantage of This results in this because they can afford a full staff color schemes, loss of sales and thereby can so there is no consistent and an unROMY SINGH offer cleaner stores CAN BE REACHED AT happy guest and better customer image from evafoa@gmail.com exp er ience. service. store-to-store.” 757-506-5926

Also, in our stores we have different color schemes, so there is no consistent image from store-to-store—in some of our stores the floor tiles have different colors and ceiling tiles are worn and old. The image of 7-Eleven stores needs to improve and adjust to look like we are in 2018. All of the above reasons result in low morale among the franchisees— not many franchisees are excited anymore. Franchisees are working 65+ hours a week and are getting fatigued. They are being pressured by the field consultants to perform extra duties. Field consultants come every week and spend four hours with franchisees, which results in 208 hours annually. Instead, the consulting time needs to be reduced so franchisees can spend that saved time on the sales floor providing service to guests in order to increase sales and gross profit dollars. How can we boost the franchisee's morale? We need the excitement and spirit back. Our franchisor must budget for capital spending to facelift our store image and invest in where the future is heading via technology and e-commerce. This will result in higher customer counts and more dollars to the franchisee’s bottom line to be able to afford the additional labor hours to provide cleaner stores and adequate customer service that our guests deserve. Our franchisor and franchisees need to be united and work together. Let's be “Us” again eliminate “We” and “Them.” AVANTI M A R C H | A P R I L 2 0 1 8

Franchisee Guest Column

CRIME AND ASSAULT PREVENTION—AN UPDATE BY JOHN HARP, CSP, ARM Risk Engineering Consultant, Mitsui Sumitomo Insurance Group Retail crime, including theft, robbery and assaults against you or your employees remains a real danger in operating a cstore. The convenience store industry is subject to crime or employee assaults that impact the store operation, workers compensation insurance program and more importantly, the well being of employees and their families.

nary 2017 data shows “Since 2011, MSIG has paid a slight decrease in viout $22,599,566 for 758 olent crime, with the assault-type workers largest drop occurring compensation claims.” in the Northeast U.S. The South is showing an increase.

KEY QUESTIONS

MSIG provides the workers compensation insurance for thousands of franchised stores. Since 2011, there have been 758 assault-type claims for a current cost of $22,599,566. As seen in the accompanying chart, the number of assaults decreased in 2017, but the costs will likely exceed 2016. The claims involve medical care, permanent or temporary disability, or fatality costs including paid amounts and reserves.

• Is your store prepared for crime and assault prevention through physical controls like quality lighting, surveillance, panic alarm readiness, etc.? • Did you know assaults or robberies do not always occur after midnight and can happen anywhere? • Are your employees trained and ready if a shoplifting event escalates or someone enters the store demanding money or cigarettes? “Violent crime • Did you know an estimated 75 percent increased for of robberies/homicides were classified as the second acquaintance-based or random? consecutive year in 2016, BACKGROUND and convenThe FBI reports that violent crime inience store creased for the second consecutive year in crime grew the 2016. Overall violent crime rose 4.1 permost of the cent that year. Convenience store crime seven retail types that are grew the most of the seven retail types that are tracked—up 6.7 percent, with gas tracked—up stations second, up 2.1 percent. Prelimi6.7 percent.”

MSIG Experience: Number and Cost of Assault Claims by Year

CLAIM EXAMPLES • Man with covered face demanded money and then shot employee in the stomach. Current costs are $585,853. • Person entered the store and stole cough syrup. Employee confronted the suspect and was hit multiple times. Current cost is $115,278. • An employee followed a shoplifter to get the license plate number on the car. The assailants hit the employee with their car, resulting in injury costs at $151,101. • Employee followed customer outside to confront a suspected shoplifter. Current employee injury costs are $345,045. Two of these claims involve the most preventable of all employee injuries—leaving the store! The other injury involves an altercation that appears to be the result of escalating a confrontation.

FACTORS THAT CONTRIBUTE TO C-STORES BEING A TARGET • Have you been robbed in the last 2-3 years? Were procedures followed? • Locations that have easy access to highways or interstates can be a target because of easy getaway. • Freestanding or isolated stores are more at risk than those in strip malls or adjacent to other buildings. continued on page 52

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Franchisee Guest Column

continued from page 51

• Poorly lit stores and parking areas are more at risk. Graffiti on the building sends a negative crime message. • Not following cash amount limits in the register will increase the chances of robbery and repeat crime. • Solo employees after hours and lack of training in recognizing and managing hostile behavior.

WHAT CAN YOU DO?

ered, including back room “All stores should and the vault. (Scalable sysregularly audit the tems can be expanded.) store and proce• Active threat monitoring with dures, and refresh training related to human intervention through crime prevention.” artificial intelligence. • Facial recognition that can detect and deter threats with mobile alerts. • Smart shelves and GPS product tracking.

• Audit your store and procedures, and refresh training related to crime prevention. AFTER A ROBBERY OR ASSAULT • Employee training, including Operation Alert. Follow up • Lock the doors and call 911. with frequent reminders, especially for new employees. Key training points: • Find any witnesses and get their information. —Be alert to customer behavior. • Call the SEI Hotline. —Do not leave the store to follow or confront a customer. • Preserve any evidence of the crime—take pictures. —Do not accuse a customer of a crime or escalate a • Contact MSIG or your workers compensation carrier if confrontation. there is any possible employee injury. • Limit outside activities after dark. Employees should not SUMMARY take out the trash after midnight. As the owner and leader of your business, your commit• Make sure employees know how to use the panic alarm and ment in ensuring the safety of your emuse the portable device when appropriate. ployees and customers is the most • Outside lighting should be checked to assure it is bright and important element in reducing the risk working. Submit a maintenance ticket for any problems. of injury from crime. By requiring your • Inside lighting should be bright and functioning. A poorly employees and managers to follow the lit store inside or out increases the risk. Make sure windows crime prevention rules with frequent reare not obstructed at the register area. minders, the num“As the owner and leader of your business, • Good housekeeping inside and out will ber of crime-related your commitment in ensuring the safety show a potential criminal there is effective incidents can be reof your employees and customers is the management and employee vigilance. duced. most important element in reducing the • Cash limit in registers should be strongly Perform a secuenforced. If a robber succeeds in getting ex- risk of injury from crime.” rity/violence precess cash, you are a likely target again. vention audit using the information from OSHA at the link: • Cigarettes have become a high target item. Limit these and https://www.osha.gov/Publications/osha3153.pdf or request a other target items in the register area of the store. Secure Safety-Security Checklist/Store audit from MSIG. them in a cage in the backroom. SEI Asset Protection, your broker, insurance company or • Keep the office door closed to limit the temptation of cigaMSIG can help you develop practical and effective strategies to rettes or cash. protect your employees from violent crime. • Encourage the police to stop in for coffee or beverages and * Training Tip: Millennials (those in their park in your lot after hours. Work with law enforcement to 20s and 30s) grew up with technology. understand criminal or gang activity in your neighborhood. Make learning flexible and interactive.

NEW TECHNOLOGY IN CRIME PREVENTION TO CONSIDER • Closed-Circuit Television that is high resolution with networked IP cameras. Make sure all primary areas are cov-

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JOHN HARP CAN BE REACHED AT

jharp@msigusa.com 908-604-2951

They also learn more when information is presented in small bits. Keeping millennials content and educated requires continuous training, feedback and coaching, and they can be motivated by praise and prizes.

SIMPLY BEVERAGES INCENTIVE CONTEST: ORDER TO WIN! Simply Beveragesâ&#x20AC;&#x2122; annual NCASEF Incentive Contest is currently underway, providing franchisees with an opportunity to win up to $2,500 for increasing the number of Simply Juice SKUs they carry in their stores. Stores will earn entries into a drawing for cash prizes ranging from $500 to $2,500 for each eligible Simply Juice SKU they increase between March 1, 2018 and August 25, 2018. The number of store entries into the drawing will be determined by using the latest store level data from the 12-weeks ending August 28, 2018 . As an incentive kicker, the NCASEF will receive a payment of $30,000 to be used at the Boardâ&#x20AC;&#x2122;s discretion if total store SKU growth meets certain parameters. For more contest details, please see the Simply Beverages ad on pages 12-13.

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7-Eleven Makes Customer Experience List 7-Eleven has been ranked among the top retailers delivering quality customer experience, reported CSNews Online. 7-Eleven achieved a rating of 73 percent in the 2018 Temkin Experience Ratings, an annual customer experience benchmark of companies based on a survey of 10,000 consumers in the U.S. Overall, the retail industry averaged a 74 percent rating in the 2018 Temkin Experience Ratings and came in third place out of 20 industries. Of the 49 retailers included in this year's Ratings, Ace Hardware and Dollar Tree tied for the top spot. Each earned a score of 82 percent and placed 7th overall out of 318 companies across 20 industries. continued on page 60

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SPECIAL NACS

Membership Offer FOR NCASEF MEMBERS The National Association of Convenience Stores (NACS), in partnership with the National Coalition of Associations of 7-Eleven Franchisees, is now offering a special membership to NCASEF members at the reduced price of $40—an 80 percent discount off of the starting membership rate of $200. The NCASEF NACS Membership Program offers industry-specific programs and services, as well as traditional association benefits to help you compete and succeed. The benefits of the special NCASEF NACS Membership Program include:

• One copy of NACS Magazine (monthly publication).

• Discounts to all NACS events.

• NACS Daily News e-newsletter.

• Discounts on all NACS training, educational, and operational products.

• Congressional and federal agency representation through the NACS Government Relations team.

• Access to NACS Help Desk, an information resource that provides answers to retailer member questions and facilitates greater industry connections. • Full voting rights as a NACS Domestic Retail member. • Potential for consideration as NACS Board or Committee Member.

NACS membership is available to any NCASEF member who operates a total of four (4) or less stores and is not a current member of NACS in 2018. NCASEF members who joined NACS previously at the $40 rate can renew based on the instructions they have received via e-mail and by mail.

To Join: Email NationalOffice@NCASEF.com and ask for the NACS Membership Application, which can be returned by email, fax or U.S. Mail. If you have questions about NACS membership for NCASEF members, please contact VP Member Services Michael Davis, at mdavis@convenience.org or NACS Retail Membership Manager, Eboni Russell, at erussell@nacsonline.com or (703) 518-4271.

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Recession are avoiding credit-card debt, reported Bloomberg. Only about one in three millennials carries a card, and the generation is more likely than older consumers to use cash or debit cards instead of traditional credit cards. • Taco Bell has overtaken Burger King as the fourth-biggest U.S. restaurant brand in sales, reported Bloomberg. McDonald’s, Starbucks and Subway held on to the top three spots. • Walmart is expanding a new assortment of meal kits and heat-and-eat prepared foods to more than 2,000 stores this year, reported Supermarket News. The expanded meal program includes ingredient packages to turn its pre-cooked rotisserie chickens into full meals and 10 varieties of heat-andeat meals. • Starbucks recently announced that it has reached 100 percent pay equity for partners of all genders and races performing similar work across the United States. The company said it is publicly sharing the principles and tools the company used to reach this goal in the hope that other employers will join in working toward pay equity. • New research from agriculture company Cargill shows that 50 percent of U.S. consumers who drink milk also consume plant-based dairy alternatives. Among the dairy alternatives, the study reveals that almond products take the lead with 80 percent preference, followed by coconut at 59 percent, and soy at 50 percent. • Generation Z, those born 1997 to present, has higher consumption rates of organic foods and beverages than any other group, and say fresh foods play a large role in this lifestyle, ﬁnds a new report from The NPD Group. • Amazon said it has no plans to roll out its Amazon Go “just walk out” technology at Whole Foods Market, which Amazon purchased last year, reported the Associated Press. • Wawa, Stewart’s Shops and Love’s Travel Stops & Country Stores are three fuel retailers that are adding electric vehicle charging stations to their forecourts in order to test demand for the alternative fuel, reported CSP Daily News. • Shoppers in California purchased the highest number of certified organic products last year, followed by Pennsylvania, reported the Philadelphia Inquirer. • The Kroger Co. has teamed with The Christ Hospital Health Network’s Center of Excellence (COE) program for its employees’ continued on page 60

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SERVANT LEADERSHIP By Hari Patel, President, Metro New Jersey FOA There is a Servant Leadership board in the back room at one of my stores. I have been looking at that board for a while, as I pass by it every single day. One day I decided to use that board to write a thank you note for my night shift employees who check in CDC and McLane deliveries, and take care of my guests. They sent me a text the following morning saying they were happy to work for me and they appreciate the recognition they have received from me. This got me thinking that I should stop demanding and start listening to their “THE WAY WE COMneeds. Of course they have MUNICATE WITH job duties to perform, but OUR EMPLOYEES MAKES A HUGE the way we communicate to DIFFERENCE. THE our employees makes a huge USAGE OF OUR difference. Our tone and our TONE AND OUR PHYSICAL GESphysical gesture can set the TURE CAN MAKE tone of a leader—and there THE DIFFERENCE is a difference between being BETWEEN BEING A BOSS AND A a BOSS and a LEADER. LEADER.”

Servant Leadership is a philosophy and set of practices that enriches the lives of individuals, builds better organizations, and ultimately creates a more just and caring world. 7-Eleven has been practicing these principles for years now, and as franchisees we should also practice Servant Leadership to enhance our businesses. The ten most important characteristics of the servant leader are: listening, empathy, healing, awareness, persuasion, conceptualization, foresight, stewardship, commitment to the growth of people, and building community.

truth is most retailers can pay higher wages than a franchisee who is struggling to run his or her store. But we can take simple steps to ensure that the talent (our employees) we have is being appreciated and acknowledge them from time to time. A single gesture like writing a thank you note on the Servant Leadership board or giving them a $25 gift card goes a long way. Since we are a 24/7 business, we cannot accommodate our employee’s schedule, which is one of the biggest complaints we see

from our employees. Currently, most states are pushing for a $15 minimum wage, our workload is increasing, and our 7-Eleven technology is far behind. For these reasons and more, we have to fight to retain our employees and try to keep them happy so they feel like working for us and are vested in their jobs.

SEI also needs to get back to basics and practice Servant Leadership. Over the past few years we have seen customer counts drop and store sales decline. More and more, SEI’s focus has shifted towards other goals while neglecting franchisees’ needs and wants. Maybe if SEI refocuses on franchisees as well as support staff, they We normally do not have sufficient time to closely reflect on would see a boost in morale and that might change the store envithe way we run our business due to the hectic pace of running a ronment. The simple gesture of asking someone how they are doing 24/7 store. Working crazy hours and juggling our time between and if they need any store and personal life is not always easy. However, we “One day I decided to use the Servant help can change need to take a break and see if we can implement Servant Leadership in our stores. Our employees are working Leadership board hanging in my back someone’s perspective room to write a thank you note for my and their attitude tofor us at a very nominal hourly rate, and unfortunately, night shift employees who check in wards work. we do not have the luxury of CDC and McLane deliveries and take spending more on labor to atHARI PATEL Ask yourself a care of my guests. They sent me a CAN BE REACHED AT tract well-qualified employees. question: “Are you text the following morning saying haripatel@gmail.com We cannot provide them insur- they were happy to work for me and practicing Servant or 732-251-6924 ance and other benefits. The Leadership?” they appreciate the recognition.” AVANTI M A R C H | A P R I L 2 0 1 8

Foodservice #1 Attraction At C-Stores

“nutritional information provided,” and “locally sourced/fresh ingredients.” More than 60 percent of Millennial and Generation X consumers in the survey gave the importance of loyalty programs a rating of 3 or higher on a scale of 1 to 5. Other technologies that focus on improving the customer experience, such as self-checkout and kiosks, also

Foodservice is now the number one reason consumers shop at convenience stores, reveals a new study by global consulting firm AlixPartners. According to the “Convenience Store Consumer Survey,” following foodservice—which includes prepared foods and hot, “Foodservice is the #1 reason cold, or frozen dispensed bevercustomers shop at convenience ages—are packaged beverages and cigarettes. Breakfast, lunch, and stores, according to the ‘Convedinner times saw the highest sales, nience Store Consumer Survey.’” suggesting that c-stores can grow foodservice sales by focusing their prodscored highly. Roughly 70 percent of uct and marketing strategies on those consumers surveyed said they are interday-parts. C-store monthly dining freested in receiving delivery from c-stores. quency jumped by more than 13 percent in the past years; meanwhile, other channels such as quick-service restaurants, grocery stores, and casual dining have stayed at or declined. Two South Florida franchisees who Among the other findings of the surare also parents of students at Stoneman vey, more than 80 percent of reDouglas High are raising money to help spondents said they would demolish the building where the reappreciate seeing more cent shooting unfolded and put a better-for-you menu permanent memorial on the site, reitems. Top characterported local news station CBS 12. istics that interested e franchisees, Zahid Anwar and consumers included Rachel Addesso, said their kids relive “freshly made in stores,”

South Florida Franchisees Help Parkland

continued on page 62

Play The Name Game! Look carefully at each page in this issue. Somewhere in this magazine a line is hidden that contains the words $Name Game Winner + person’s name + city$. If you find this line, and it contains your name, call AVANTI’s Offices at 215 750-0178 before the next magazine is published, and win this issue’s total. NCASEF Members only.

AVA N T I M A R C H | A P R I L 2 0 1 8

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total hip and total knee replacement and spine surgery benefits, reported Supermarket News. The COE program allows employers to contract directly with the Cincinnatibased hospital for specific procedures at a fixed price. • An alliance of 11 Japanese automakers and energy firms has pledged to build 80 fuelling stations for hydrogen fuel cell vehicles by 2022 to help speed up the development of the next-generation fuel technology, reported Reuters. • Refrigerated fresh soup sales increased 18 percent in 2017 to $325 million, presenting an opportunity for c-stores, reported NACS Online. The newest and biggest contributor to that space is Panera Bread, which made more than $100 million in sales last year with its Panera at Home brand. • The FDA recently released an Advanced Notice of Proposed Rule Making—the first step in a longterm regulatory process—to lower nicotine levels in tobacco, reported NACS Online. The notice suggests the FDA is taking a serious look at reducing nicotine levels to minimal, or non-addictive, amounts in tobacco products. • Impossible Foods, a company known for its burgers, has raised $114 million to create more plant-based meat, reported Axios. The company would like to some day offer not just ground meat, but alternatives to fish, chicken, steak, eggs and cheese. • Walmart has teamed with MoneyGram International to debut an international money transfer service dubbed Walmart2World, an extension of the U.S.-based Walmart2Walmart platform, reported CNBC. The global service targets consumers who don’t have a bank account and will allow customers to relay funds to people in more than 200 countries. • Home Depot plans to donate $50 million to the Home Builders Institute over the next 10 years to train 20,000 military veterans, high-school students and others for construction careers, reported USA Today. The construction industry had about 158,000 job openings late last year, and 84 percent of home builders surveyed said finding enough employees is one of their top challenges. • University of Portsmouth biologist Professor John McGeehan and his colleagues accidentally created a super-powered version of a Japanese plastic-eating enzyme that could help tackle the world’s plastic pollution problem.

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Legislative Update such as whole grains, low-fat dairy, fruits and vegetables and healthy oils. e FDA also said it will consider whether it can make labeling nutrients more consumer-friendly.

Baltimore To Ban Styrofoam e Baltimore City Council is poised to forbid city businesses from using polystyrene foam containers for carryout food and drink—a bill that Mayor “Baltimore may soon ban Styrofoam Catherine E. containers for food usage to cut down Pughhas pledged

on waste in the city’s waterways.”

to sign into law, reported the Baltimore Sun. e council recently gave preliminary approval to the bill that Councilman John Bullock introduced as an eﬀort to cut down on the number of foam cups floating in Baltimore’s waterways. e bill would enact criminal fines on businesses that fail to comply with a ban that states that “no food service facility may use any disposable food” container made from polystyrene foam, commonly called Styrofoam. Violating the law would be a misdemeanor that carries a $1,000 fine. e mayor said she plans to support the legislation because the council agreed to amend the bill and give city businesses 18 months to comply with the foam ban aer she signs it.

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the nightmare every time they see the three-story freshman building, so they want to financially help the district to level it. e pair, along with other 7-Eleven franchisees across South Florida, placed donation jars on their store counters and raised $5,000 in the first 10 days. e franchisees also created a GoFundMe page where 7-Eleven storeowners and customers nationwide could donate to the cause: https://www.gofundme.com/marjory-stoneman-douglas-hs-funds.

Walmart Expands Online Grocery Delivery Walmart plans to expand its online grocery delivery service to 100 metropolitan areas by the end of the year, reported the New York Times. Orders will be fulfilled at more than 800 stores nationwide and shuttled to shoppers by drivers contracted

through Uber, Deliv and other ride and delivery platforms, the article states. Customers must order at least $30 worth of goods and pay an additional delivery fee of $9.95, and they can receive their purchases in as little as four hours if they put in the request by 1 p.m. e plan puts the Walmart on a direct collision course with Amazon, which purchased the Whole Foods grocery chain for $13.4 billion last summer and recently announced plans to use those stores to fill on-demand orders.

Conditions On SEI’s Sunoco Acquisition Following a public comment period, the Federal Trade Commission recently

“Walmart online grocery customers in 100 metro areas will be able to receive their orders within four hours by the end of the year.”

approved a final order settling charges that the proposed $3.3 billion acquisition of 1,100 Sunoco retail fuel outlets by the Tokyo-based parent company of 7-Eleven would violate antitrust law. According to the complaint, the acquisition as proposed by Seven & I Holdings Co. would harm competition in 76 local markets across 20 metropolitan statistical areas. Under the terms of the final order, SEI is required to sell 26 retail fuel outlets that it owns to Sunoco, and Sunoco is required to retain 33 fuel outlets that 7-Eleven otherwise would have acquired. Sunoco intends to convert the acquired or retained stations from company-operated sites to commission agent sites. Sunoco will have full control over fuel pricing and supply at all of these locations.

Doing Away With Credit Card Signatures As credit card companies kill customer-signature requirements, retailers like Walmart and Target are following suit, reported Business Insider. Visa, MasterCard, Discover, and American continued on page 64

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Express have either already stopped “Customers in China can use or announced plans to stop requiring facial-recognition technology to customers to sign their receipts when checking out. While retailers have the pay for food, get money from option to continue to require signaATMs, and even get a loan.” tures, it seems that few major companies will do so. Target plans to pay for food, get money from ATMs, eliminate the requirement soon, and a and even get a loan. Remark, which has Walmart spokesman said the company data partnerships with Alibaba, Tenconsidered signatures “worthless” and cent, and Baidu, has a significant preswould also stop requiring them. Creditence in China. card companies and retailers alike have cited the rise of online shopping and new technology like EMV chips in cards as making made signatures less necessary as a fraud-protection measure and have argued that requiring them can According to the Koupon Media’s 2018 slow down checkout lines. State of the Industry report, the convenience store industry continues to outpace its brick-and-mortar peers in both revenue and store count, and mobile offers have emerged as one of the most effective tools for marketers. Key 2017 success stories in 7-Eleven is rolling out artificial inthe report include: a mobile offer campaign telligence at its 11,000 stores across that drove 19 percent YOY sales growth for ailand, as the technology becomes a leading candy brand; a case study showmore prevalent in Asia, reported Busiing that consumers spend 6.3 percent more ness Insider. 7-Eleven will use facialper basket when redeeming a mobile offer; recognition and behavior-analysis and a beer mobile rebate campaign that technologies to identify loyalty memwitnessed a 58 percent redemption rate bers, analyze in-store traffic, monitor and delivered an annualized $1.2 million product levels, suggest products to cusin value to consumers. tomers, and even measure the emotions With convenience stores poised to of customers as they walk around. e capture a larger percentage of consumer company announced it will be using spend over the next two years, the report technology developed by U.S.-based predicts the opportunity for CPG brands Remark Holdings, which says its facialand c-store retailers will only recognition technolgrow. Koupon Media stated that ogy has an accuracy its fourth annual State of the Inrate of more than 96 dustry report comes aer anpercent. other record-setting year for the Facial-recognition company, which delivered over technology is experi730 million mobile offers in encing a boon across 2017, reaching over 108 million Asia, particularly in customers and driving 155 milChina where cuslion store trips. tomers can use it to

Mobile Offers Increase Sales

Facial-Recognition Tech In Thailand

FedEx Rolls Out Stores Inside Walmart FedEx Corp plans to open 500 FedEx Office stores inside Walmart Inc's U.S. locations, a partnership intended to help both companies attract new customers and handle online order returns, reported Reuters. e new locations, to open over the next two years, are going to be in addition to the 47 stores inside Walmarts across six states that oﬀer packing, shipping and printing services. e chief executive for FedEx Oﬃce told Reuters that the move is a significant part of FedEx's strategy to handle returns of items that were ordered online as the company has witnessed orders from retailers triple in volume. He added that FedEx is rethinking last-mile package delivery into crowded residential areas and expanding its network of convenience locations.

Consumers Prefer Fuel Savings Rewards A new report released by loyalty marketing and technology firm their preferred loyalty currency over cash-back rewards for the third year in a row. Findings from “e Road to Rewards 2017” indicate that fuel savings, a currency that helps consumers save on the price of gas, have become a more attractive and valuable rewards currency, as 39 percent of consumers prefer fuel savings whereas only 35 percent prefer cash-back on credit cards. For convenience stores, the insights from this report present new opportunities to generate revenue and engage customers by adopting a fuel savings currency: 20 percent of consumers recontinued on page 66

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ported shopping specifically at stores where they can earn rewards that help them save on the cost of fuel, and 22 percent said they will shop exclusively at a convenience store where they are a loyalty program member.

Wawa To Open Largest Store In Philly Pennsylvania-based convenience store chain Wawa is building its biggest store in Philadelphia, reported NBC Philadelphia. e newest Wawa, located across from Independence Mall inside the Public Ledger building at Sixth and Chestnut streets, will be their largest store in the country at 11,300 square feet. at is more than 2,000-square feet larger than its mega Washington, D.C. store. is store is projected to be complete by the end of 2018, and will feature a higher level of sophistication and cra than most Wawa stores, like couches and café seating near the entrance, the company said.

Dollar General Expands Fresh Produce Dollar General is ramping up its expansion plans for 2018 and rolling out several new merchandising initiatives, including adding fresh produce to hundreds of remodeled locations aer a successful test, reported Supermarket News. Of the 1,000 store remodels Dollar General has planned for 2018, about 400 will be what the chain calls its “traditional plus” stores that include 34 cooler doors to merchandise an expanded perishables assortment. Of the 750 traditional-plus stores to be operating by year-end, about a third will include an assortment of fresh produce, bringing to 450 the number of stores carrying fresh fruits and vegetables. continued on page 68

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Greater Seattle & Pacific NW FOAs Hold First Joint Trade Show The Greater Seattle and Pacific Northwest FOAs would like to say thanks to the vendor and franchisee communities for participating in the first joint trade show of both FOAs and making it such a hugely successful event. The trade show was held on March 29 at Meydenbauer Center in Bellevue, Washington. Without the support from vendors and franchisees, this would not have been possible. With the level of accomplishment in the transacted or proposed business, we can proudly say the future of our franchisee and vendor relationship is really getting better. We had a great turnout of 98 franchisees with 129 stores and 73 vendors who participated. The enthusiasm with which both the franchisees and the vendors interacted was really pleasing, as well as promising a profitable year ahead. Franchisees placed almost 3,600 orders during our event! The trade show provided a great opportunity to see so many vendors under the same roof. Franchisees made a lot of great deals and opened a valuable line of communication with vendors. We are sure this will help us in our business strategies and profitability. Besides making you aware, the magnitude of ordering and participation from franchisees was so great that most of vendor partners had finished their samples and deal sheets in the middle of show—they were writing orders on blank sheets! A very special thanks to our valiant leader and National Chairman Jay Singh and Vice Chair Rehan Hashmi for traveling with very rigid schedule and still bless our show. Unity is strength. When there is teamwork and collaboration, wonderful things can be achieved. —Ajinder Handa, President, Greater Seattle FOA

Higher Oil Prices Affect Couche-Tard's Margins Alimentation Couche-Tard said rising crude prices pressured margins from gasoline sales in the third quarter ended February 4, setting its stock on course for its biggest drop since 2008, reported Reuters. Couche-Tard said gross margins in its road transportation fuel business in its biggest market, the United States, fell 14.6 percent. e company attributed the slide to “volatility created by the rapid and significant rise of crude oil prices” and lingering eﬀects of Hurricane Harvey. Same-store road transportation fuel volumes, excluding the impact from a recent acquisition, fell 0.4 percent in the United States.

Stores Offering ‘Scan & Go’ More retailers are oﬀering apps that allow shoppers to ring up purchases as they shop in hopes of making checkout a smoother experience for those who choose the service, reported the Associated Press. For customers, scanning as they go can be faster and make it simpler to keep track of spending. For stores, the big expansion of this technology coming this year costs less than installing more self-checkouts. e technology, while slightly diﬀerent from chain to chain, allows shoppers to scan UPC codes on items as they shop. According to the report, a big push is coming this year from big chains: grocery chain Kroger Co. is adding the scan-and-go technology to 400 stores;

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Walmart is testing the service in 120 stores, while all its 600 Sam's Club stores have it; and B.J.'s Wholesale Club has launched the service in a handful of stores and plans to add it to about 100 clubs this year.

Foodservice Delivery Posts Double-Digit Gains Despite the overall weakness in the U.S. restaurant industry, foodservice delivery posted sizable gains in both visits and sales over the last five years, reports e NPD Group. e 20 percent in- “Digital crease in delivery ordering sales and 10 percent gain in delivery now reprefoodservice visits sents more were supported in than half of large part by the all delivery growth of digital ordering, which now visits.” represents over half of all delivery visits. According to the study, consumers are so accustomed to ordering delivery that they are ordering it at breakfast and lunch in addition to dinner, which historically has been the most popular daypart to order it. Growth of delivery at dinner has remained flat over the last five years and has grown at breakfast and lunch.

Short Visits Rise At Whole Foods

Shoppers are making more quick trips to Whole Foods stores that have installed Amazon.com lockers, giving the re“A big expansion of ‘Scan & Go’ techtailer a new way to nology is coming this year and will boost sales, reported Reuters, citing research cost less than installing self checkouts.” from location data ad-

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vertising firm inMarket. Short “micro” visits, defined as three to five minutes in length, were up 11 percent at stores with lockers since Amazon closed its purchase of Whole Foods on August 28, according to the inMarket study. at compares with the 7 percent gain at stores in the same cities that do not have the lockers. People who stop at Whole Foods to retrieve a package from an Amazon locker could be tempted to buy a drink, milk or a promoted item, said experts, who added that the trips are also a way for the retailer to keep shoppers abreast of changes at the chain.

Daily Coffee Consumption Up e percentage of Americans drinking coffee on a daily basis increased to 62 percent this year, up from 57 percent in 2016, according to the National Coffee Association’s 2017 National Coffee Drinking Trends (NCDT) consumption tracking report. e increase brings past-day overall coffee consumption back above 2014 levels, reversing slow declines since 2013. Among the drivers behind the increase was soaring consumer enthusiasm for gourmet coffee varieties across most demographics. Another key driver was a robust increase in past-day coffee drinking among younger consumers. While the frequency of daily consumption continued to grow for all age continued on page 70

Order NOW! UIN 098817

groups, the most robust increase occurred among those 13-18, whose daily consumption rose to 37 percent in 2017 from 31 percent in 2016. e 40-59 group showed an 11-point uptick over last year—moving from 53 percent in 2016 to 64 percent in 2017. ose 60+ moved to 68 percent in 2017 from 64 percent last year, while the 25-39 year olds increased from 60 percent to 63 percent, and the 18-24 cohort edged up to 50 percent from 2016’s 48 percent.

Electric Cars Could Hurt C-Stores If drivers of electric cars aren’t stopping at gas stations to fill their tanks, the opportunities for impulse purchases inside at the convenience store could dry up, reported the Washington Post. at’s a real possibility, according to Morgan Stanley analysts who wrote that conven-

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they always do: ey’ll find a better way to compete.”

Energy-Efficient Roller Grills

ience stores could see a hit to beverage sales as more electric cars hit the road. But experts on the convenience store industry say any substantial threat from electric cars is still decades away. While energy-eﬃcient vehicles may catch on en masse with time, more immediate competition for convenience stores comes from the scores of retailers and online companies vying to sell convenience. “Beverages drive sales, and beverages drive profits at convenience stores, so any competition that could reduce those sales and those profits is a concern,” said Jeﬀ Lenard of the National Association of Convenience Stores. “However, I think that stores will do what

“Electric cars not stopping to get gas could hurt impulse purchases at c-stores, according to Morgan Stanley analysts.”

Creative Serving, a Union, NJ-based manufacturer of retail countertop food service equipment, recently unveiled a new roller grill that utilizes heating elements with significantly lower wattage requirements than the industry norm. Traditional roller grills run heating elements through about 8-15 hollow rollers. However, the heated air continuously escapes from both sides of the hollow rollers, requiring higher wattage heating elements, turned on more oen, to maintain needed temperatures. In contrast, Creative Serving’s eﬃcient grills seal the ends of hollow rollers. e sealed roller ends prevent the heated air from escaping, and enable significantly lower wattage heating elements, saving up to 20 percent in energy costs, the company said.

Want to talk to other franchisees? To find the FOA closest to you. Visit www.NCASEF.com to contact any one of the 43 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.

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Nick Bhullar, Vice Chairman, Board Member, So. California FOA

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

bhullar711@yahoo.com 818.571.1711

rehan711@yahoo.com 847-845-8477

Romy Singh, Vice Chairman, President, Eastern Virginia, FOA

National Office

757-506-5926 evafoa@gmail.com

nationaloffice@ncasef.com

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TOP 4 TIPS FOR TROUBLESHOOTING ELECTRONIC PRICE SIGNS By Wolfgang Manz, President & CEO, PWM Electronic Price Signs When a sign isn’t displaying gas prices properly, impact on business is immediate. In this scenario, sign storeowners work frantically to correct the problem as quickly as possible. Being prepared in advance for common issues can make all the difference, smooth out the process and get your sign back up and running in no time. So we asked PWM’s Operations Manager, Scott Honza to shared his insights about common issues and how to resolve them.

QUICK TIP #1: CHECK FOR DISCONNECTION If a sign suddenly stops working, it’s not time to panic. “The majority of calls we receive are about bad communication between the control unit in the store and the price sign outside.” Scott recommended checking the physical connections. Anything from an unplugged cable to a loose wire might be the issue. These are quick fixes that most storeowners can handle easily if they know where to look.

QUICK TIP #2: KNOW HOW TO MAKE PRICE CHANGES PROPERLY Often, customers just need guidance on how to make changes to their sign and are hesitant because they don’t want to make a mistake. Each sign manufacturer has their own instructions, but PWM’s are easy to follow. The storeowner can open the control unit, enter the first selection, change the price with up/down arrows, hit enter, and move on to the next digit. It’s as easy as changing the time on a digital clock. “We are always happy to walk storeowners through the process so they feel comfortable using the system.”

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QUICK TIP #3: BE CAUTIOUS TO AVOID OVERHEATING What if the whole sign goes down and then comes back online a few hours later? This is almost always an overheating issue. The power supply has a failsafe in place to shut down the sign if temperatures rise too high. With PWM’s heat tolerant signs, that doesn’t happen until temps reach about 175o. Obviously, this makes overheating unlikely. But in locations like California or Nevada, the blazing sun can sometimes cause the sign to shut down. If this is a rare occurrence, it may be a tolerable nuisance. But if it is a repeated occurrence that’s impacting revenue for the gas station, it needs to be resolved. “This problem is fixed by addressing ventilation within the sign. We have a procedure to create a kind of chimney effect to release the excess heat. It’s a highly effective solution with a success rate of well over 90 percent.”

QUICK TIP #4: KNOW WHEN TO CALL THE EXPERTS If there is one line of digits that’s showing all 8s and the rest of the screen is black, there may be something more serious wrong with the sign. According to Honza, this error usually indicates a problem with the power supply. In this case, a service call may be needed to repair, or replace the malfunctioning component.

PWM IS HERE TO HELP PWM’s German designed/manufactured price signs are heat and water resistant—and built to last. With their modular structure, each part can be replaced independently to keep maintenance costs low. Most important, our technical team is available 24/7 at 866-796-7446 or support@p-w-m.com to answer questions, perform remote diagnostics, service your signs, and keep your business running.

WOMEN'S FRANCHISE GIVEAWAY CONTEST LAUNCHED

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Interested women can enter online at Franchise.7-eleven.com/franchise/ we-take-the-lead now through 11:59 p.m. CDT on May 7, 2018. The winner will be announced in October 2018.

In conjunction with National Women's Month in March, SEI announced its “W.E. Take the 7-ELEVEN 'GREEN TEAM' Lead” Women's Franchise Giveaway HELPS MILWAUKEE Contest, targeted exclusively to female NEIGHBORHOOD CENTER entrepreneurs. The company said one On March 10, SEI’s “Green Team” of deserving woman will be awarded an volunteers along with Keep Greater Milinitial franchise fee-free 7-Eleven fran- waukee Beautiful worked to restore the chise, for an initial franchise fee value of Silver Spring Neighborhood Center's up to $190,000. This is the second year greenhouse as a part of their new re7-Eleven has targeted women for the duced emissions program—RENEW, franchise giveaway. powered by GreenPrint—to provide The multiphase contest includes more sustainable options to the city. The submitting a detailed franchise applica- RENEW program allows drivers to help tion, meeting company franchising qualreduce their carbon footprint, even ifications, preliminary interas they drive. For every gallon views, a video submission, and grade of gas pumped “One an in-store hands-on exat participating 7-Eleven woman will perience, and a final onelocations, RENEW on-one interview with be awarded a plants trees throughout SEI senior leadership for store without the Milwaukee and the top finalists, all of a franchise Madison, Wisconsin which will occur over an areas and invests in certifee.” eight-month period. fied carbon emissions reducIn addition, SEI said it will tion projects to neutralize make a donation to the winning emissions by up to 30 percent. woman's charity of choice that aligns Additionally, as part of the one-year with the 7-Eleven Project A-Game grant RENEW pilot, program. Project A-Game funds youth 100,000 trees programs focused on education, fitness, will be planted safety and hunger relief. The winner can across the U.S. choose any of the company's corporatein cooperation operated 7-Eleven convenience stores with the Arbor available for franchising in the continenDay Foundatal U.S. at the contest's culmination.

tion. This Milwaukee area project is one of the many local, regional and global initiatives RENEW has invested in to reduce emissions. The 7-Eleven RENEW program, powered by GreenPrint, is available at 93 participating 7Eleven stations in Oregon, Washington and Wisconsin.

SEVEN RESERVE PREMIUM COFFEE BRAND WITH AFRICA BLEND SEI headed straight to the continent of Africa for the first limited-time coffee available under the company's new Seven Reserve brand of fresh-brewed premium coffees. The Seven Reserve Africa Blend is a 50-50 combination of 100 percent Rainforest Alliance Certified Arabica beans cultivated on small farms in the countries of Ethiopia and Rwanda. Africa Blend is 7-Eleven stores' first duoArabica coffee to carry the Rainforest Alliance Certified seal. Since 2016, 7-Eleven has introduced four Rainforest Alliance Certified coffees—Nicaragua, Mexico, Peruvian and Colombian, all responsibly grown, the company said. Single-origin 100 percent Colombian Rainforest Alliance Certified coffee is now a permanent offering and top-seller on the hot beverage bar. continued on page 76

“Africa Blend is 7-Eleven stores' first duo-Arabica coffee to carry the Rainforest Alliance Certified seal.” AVANTI M A R C H | A P R I L 2 0 1 8

www.ncasef.com

7REWARDS MILLION POINTS GIVEAWAY SEI gave customers more reasons to sign up for its 7Rewards loyalty program within the 7-Eleven app with its recent Million Points Giveaway Sweepstakes. The

“7Rewards ramped up the visibility on its new loyalty progarm with the Million Points Giveaway.”

contest awarded seven lucky people 1 million 7Rewards points each, redeemable to buy top-selling food and drinks at participating 7-Eleven stores. In addition to multiple Million Points prizes, exclusive experiential prizes were also awarded weekly. The prizes included a completely outfitted media room, trips to sporting events and racing weekends, live music events, and even a trip for two to Paris, France.

The Million Points Giveaway coincided with the recent 7Rewards loyalty platform enhancement that adds a pointsbased loyalty program. Now 7-Eleven shoppers can easily earn points on almost everything they buy—approximately 80 percent of those available in the store. The sweepstakes ran from early March through April 28, 2018, with winners drawn weekly.

7-ELEVEN TOTS NOW IN STORES NATIONWIDE SEI’s its newest hot food introduction, 7-Eleven Tots, has a distinct ad-

$Name Game Winner Joseph Carpenter, Lakewood, Colorado$

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vantage over other tater tots: 7-Elevenâ&#x20AC;&#x2122;s condiment and toppings bar. Condiments used to top nachos and Big Bite hot dogs also provide a delicious and easy way to customize 7-Eleven tots. Stores offer between six and 10 topping choices in addition to mustard and ketchup. Each store varies, but primary toppings typically found include chili

sauce, melted cheese, pico de gallo, diced onion, sliced jalapeno peppers, green relish and pickles. Ranch dressing is also available. Made with 100percent real Idaho and Oregon potatoes, 7-Eleven Tots are crispy and golden brown on the outside with fluffy potatoes on the inside. 7-Eleven Tots are available in small and large sizes. Suggested retail price for a small order of 10 tots is $1, the large 25-tot order is $2.

AUTHENTIC MEXICAN BAKED GOODS ADDED TO 7-SELECT 7-Eleven recently expanded its offerings of Hispanic Packaged Bakery items and introduced its new 7-Select private brand line after months of testing in Mexico and Texas. Appealing to a variety of taste preferences, three traditional Mexican sweet bread options are being offered at participating 7Eleven stores: Panquecitosâ&#x20AC;&#x201D;Golden, continued on page 78

Visit the NCASEF Website www.ncasef.com

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soft and sweet vanilla mini loaf cakes; Roles de Canela—Cinnamon rolls with raisins; and Panque con Nuez— Sliced pound cake with chopped pecans. The United States is home to almost 58 million Hispanics, representing 18 percent of the country's population with significant spending power. Hispanics are a dominant 7Eleven demographic and a majority fall in 7-Eleven's sweet spot—millennialaged and younger, the company said. As such, the products were extensively tested in Mexico for flavor, texture, aroma and appearance in order to meet or exceed consumers' expectations.

previously not been available to manage product security, inventory control, merchandising, speed of service and accounting for retailers, Scientific Games said. SCiQ is now live in pilots in Arizona, Ohio, Maine, North Carolina, South Carolina and Texas, and scheduled for pilots in Georgia, New York and Pennsylvania.

7-ELEVEN RECOGNIZES PUBLIC SERVANTS lines—organic juices and dried fruit. In the last four years, 7-Eleven private brand products have won more than 20 national and international awards recognizing both product and packaging excellence, all designed by Brandimage.

7-ELEVEN STORES TESTING NEW LOTTERY TECHNOLOGY PACKAGE DESIGN FOR 7-SELECT & SLURPEE CUP WIN AWARDS 7-Eleven private brand and proprietary products designed by Brandimage keep winning awards, with the most recent ones from Graphic Design USA, SEI announced. Brandimage, an international brand development agency, has received three 2018 American Package Design Awards: one for the cup redesign on Slurpee drinks and packaging design for two 7-Select private brand product

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7-Eleven has agreed to test Scientific Games Corporation's new SCiQ lottery instant game retail technology. The intuitive and easy-to-use SCiQ dispensers are available now in select 7-Eleven stores. According to Scientific Games, SCiQ is a highly-advanced technology ecosystem developed by the company to improve the financial performance of lottery products and eliminate existing challenges to selling lottery in retail stores. For consumers, SCiQ brings the ease and convenience of mobile technology to retail lottery purchases. While lottery sales are a major driver of c-store visits, technology has

SEI recently delivered 5,000 pizzas and 15,000 donuts to police, sheriff and fire departments, emergency rooms, DMVs and post offices nationwide in an effort to give well-deserved recognition to our public servants. Honoring the hard work these men and women put into serving local communities every day, approximately 2,000 representatives “7-Eleven from 7-Eleven personally delivered recently recognized five pizzas or 24 police and donuts to 1,700 pubother public lic service offices in 88 participating servants in markets, including multiple New York, Los Anmarkets geles, Chicago and with pizza Dallas. Additionally, and donut each delivery ingiveaways.” cluded a personalized thank you note. “Public servants are often the unsung heroes of our communities and we're delighted to take time today to extend our thanks for all they do,” said Greg Franks, 7-Eleven senior vice president of operations.

Trident Vibes Coming To 7-Eleven

berries and Almonds, Blueberry, Peaches and Pecans, and Pineapple. Each single-serve cup is packed with over 15 grams of protein. Just like all DairyPure products, Mix-ins have no artificial flavors, sweeteners, or artificial growth hormones. (No significant difference has been shown in milk from rbST treated cows and non-rbSt treated cows.)

New Trident Vibes are rolling out at 7-Eleven on June 4, 2018, and the gum aisle will never be the same again. Trident Vibes brings the bright, fun, and playful world of candy to gum with its delightfully unexpected flavor and color combinations, its playful flavor names, and breakthrough package design. Available in three flavors—Spearmint Rush, Ooh La Lemon, and Tropical Beat—Trident Vibes The new Fiji Water Sports Cap offer a disruptive multi-senbottle is slim, trim and ready for the sorial experience. Begingym. Featuring a convenient, new flipNew Trident Vibes is available in three flavors. ning with a crisp, candy-like shell top cap, it’s the perfect companion for active, that gives way to a smooth, effortless chew and unexpected waves of The new Fiji on-the-go hydration. Whether you’re running, cycling, taste driven by pops of flavor beads, it’s a delicious, long-lasting sensaWater Sports lifting or striking your most advanced yoga pose, you can tion designed to delight. Cap bottle enjoy FIJI Water’s signature soft, smooth taste to help features a Featuring fun, distinctive packaging, striking visibility, and strong perfuel your fitness goals. It’s untouched by man—until you convenient, sonal relevance with consumers, Trident Vibes were highly liked in conflip open the cap. flip-top cap. sumer testing and outperformed the leading competition for “overall continued on page 82 liking” and “long lasting.” So, make sure you’re set for Summer 2018 and get ready to feel the good Vibes.

Fiji Introduces New Sports Cap Bottle

Introducing DairyPure Mix-ins Cottage Cheese For health-conscious millennials looking to grab something portable and protein-rich, Dean Foods and DairyPure is introducing DairyPure Mix-ins Cottage Cheese. More than just mixing in real fruit and wholesome nuts to cottage cheese, this snack mixes in protein and convenience with on-the-go, easy-tomix flavors that can be enjoyed anywhere, any time of day. DairyPure Mix-ins Cottage Cheese is DairyPure Mix-ins Cottage available in four satisCheese makes it easier to mix in the good stuff. fying flavors: Straw-

NEW M&M’S CHOCOLATE COOKIE SANDWICHES

Mars Wrigley Confectionery recently introduced the latest addition to the M&M’s Ice Cream line-up: M&M’s Chocolate Cookie Sandwich, tasty frozen treats that feature reduced fat chocolate ice cream surrounded by two home-style chocolate cookies with M&M’s Minis baked in. The combination of the M&M’s Minis with chocolate ice cream makes the M&M’s Chocolate Cookie Sandwich a first-of-a-kind treat, with double the chocolate from the inside out. M&M’s Vanilla Sandwich is up 177 percent in same store sales year-to-date. Across all channels, the M&M’s Vanilla Sandwich is the fastest growing cookie sandwich, and the same is expected for M&M’s Chocolate Sandwich. In testing, M&M’s Chocolate Cookie Sandwich generated an 81 percent purchase Intent among consumers. Additionally, M&M’s Ice Cream Cookie Sandwiches appeal to many types of households—millennial (buying power $15 trillion), Hispanic, and households with 3-plus children. SRP is $1.99, Everyday GP 46 percent, and the Promotional The M&M’s Chocolate Cookie Sandwich is up 177 percent year to date. GP is 70 percent. Order today—SLIN 190582. AVANTI M A R C H | A P R I L 2 0 1 8

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Lil’ Drug Store’s Nicotac Brand Nicotine Gum Lil’ Drug Store Products is introducing Nicotac brand nicotine gum as the latest addition to their growing portfolio of health and wellness brands. As of May 1, 2018, Nicotac is shipping exclusively to convenience stores to help the estimated 22 million adult smokers who say they want to quit smoking each year. Lil’ Drug offers Nicotac in two nicotine strengths (2 mg and 4 mg nicotine polarcrilex) and a complete assortment of flavors including fruit, mint and Nicotac brand nicotine cinnamon, the most popular flavors of nicogum is priced 45 percent tine gum. Nicotac is sold in 10-piece packlower than the leading ages at a suggested retail price of $4.99, national brand. approximately 45 percent lower than the leading national brand currently sold in convenience stores. Convenience stores are the logical retail channel for Lil’ Drug to launch Nicotac brand nicotine gum. Although convenience stores sell more cigarettes than any other retail channel, less than 3 percent of Nicotine Replacement Therapy (NRT) products are sold in cstores to help smokers quit. Lil’ Drug aims to make NRT products like Nicotac brand nicotine gum more widely available to cstore shoppers by marketing the brand to over 150,000 convenience stores in the United States.

NEW WONDERFUL PISTACHIOS NO SHELL Sometimes you want a tasty, protein-powered snack without having to crack some shells. Wonderful Pistachios No Shells 2.5 ounce are great at home or on the go. 82

NoDoz Back At C-Stores The #1 recognized brand in alertness aids is back. NoDoz returns to c-stores with two new pack sizes built specifi-

NoDoz returns to c-stores with two new convenient pack sizes.

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cally for convenience shoppers. Give your customers the boost they’re looking for and carry the category leader in brand awareness. NoDoz is now available exclusively from Lil’ Drug Store Products. Learn more at lildrugstore.com/nodoz.

Good2Grow Fortified Waters For Kids Good2Grow is debuting a new line of Fortified Water products available now. Good2Grow Fortified Waters provides a kid-focused offering in the water door, which is dominated by non-kid focused options. Fortified Waters will further expand the water category’s usage and appeal to kids who typically view water as their least desirable beverage option. This new line from Good2Grow comes in a 10 ounce bottle and is available in two delicious flavors: Raspberry Lemonade and Orange Mango. Kids will also love the new, exclusive Good2Grow is debuting a new characters in this line, and parents will line of fortified waters for kids. appreciate that these products contain a good source of Vitamin D and Calcium, while still only being 20 calories and 3g of sugar.

Portable & Poppable Skippy P.B. Bite Minis Makers of the Skippy brand have taken the big taste of real Skippy peanut butter and put it into mini bite-sized snacks with new Skippy P.B. Bites Minis. Portable and poppable, this new snack is packed with peanut buttery goodness. Consumers are looking for protein-rich snack options that are also quick and convenient to meet an on-the-go lifestyle. Skippy P.B. Bites Minis come in two delicious varieties—Graham and Double Skippy P.B. Bites Minis available Peanut Butter—meeting both creamy in Graham and Double and crunchy snacking preferences. In Peanut Butter flavors. line with snacking trends, Skippy P.B. Bites Minis offer over 6 grams of protein per serving, packing this portable snack with a craveable boost of energy to satisfy the snacking continued on page 84

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needs of peanut butter-loving consumers, anywhere, anytime. The manufacturer recommends merchandising P.B. Minis in your alternate snacks section. Packed 10/1.5oz Peggable units in display ready caddy. Retail is $1.99. • Skippy P.B. Bites Minis Double Peanut Butter: McLane UIN 051897; Core-Mark DCMS 454419; UPC 37600810043; SLIN 00234 • Skippy P.B. Bites Minis Graham Cracker: McLane UIN 051907; CoreMark DCMS 454418; UPC 37600810081; SLIN 00235

Offer Superior Quality With Zig-Zag Ultra Thin Paper With over 130 years of paper knowledge and unrivaled craftsmanship, Zig-Zag continues to provide a range of premium quality papers that deliver consistent superior smoking experiences. Zig-Zag papers are

DIAGEO ANNOUNCES SUMMER BREWS Spike your alcohol beverage sales this summer with the latest offerings from the Diageo Beer Company: Smirnoff Ice Margarita 6 pack—Smirnoff Ice is launching a new Margarita flavor, combining the excitement and universal appeal of the #1 mixed cocktail with the leading quality of Smirnoff Ice. People are looking for simple solutions as they shift to more at-home drinking occasions. Smirnoff Ice Margarita comes in 6 pack bottles so consumers can enjoy the refreshing taste of an authentic Margarita without the fuss. With high appeal among 72 percent of consumers, Smirnoff Ice Margarita is sure to make a splash this summer.

made in France using natural flax plant fibers, which provide strength, fineness and a slow burn. They also feature 100 percent Natural Gum Arabic—a thin glue line to provide a perfect seal every time. Derived from the sap of the African acacia tree, the natural properties of gum Arabic provide a consistent seal without impacting the taste of the smoke. Each paper goes through a complex watermarking process that provides a distinctive sign of superior quality—Qualite Superieure. Available in 32 papers per booklet.

Spam Spread Arrives At 7-Eleven Not all spreads are created equal, and nothing proves this better than Spam Spread. New Spam Spread goes great with crackers, Getting the incredible flavor of Spam Classic in bread, appetizers and a spreadable form may seem like magic. When other snacks. you try it with crackers, bread, appetizers and other snacks, it certainly tastes like it. Merchandise the Spam Spread 3 ounce Pop Top Can in your grocery section next to 12 ounce Spam Classic for a brand block of Spam. Retail is $1.39. UPC 037600000024; McLane UIN 052107; Core-Mark DCMS 775981

Enjoy increased sales with Smirnoff Ice Red, Smirnoff Ice Margarita, and the seasonal Guinness Irish Wheat. Smirnoff Ice Red, White & Berry in 6 packs and a 16 ounce Can—Smirnoff Ice is back with the exciting limited edition Red, White & Berry, a blend of cherry, citrus, and blue raspberry flavors. Red, White & Berry was the #1 FMB innovation of last summer. Vibrant packaging and liquid celebrates America’s summer occasions. Red White & Berry 6 packs are available now as an SSI. As of May it will also be available in 16 ounce cans.

Guinness Irish Wheat 6 pack—Guinness Irish Wheat returns as the Guinness seasonal this spring and summer. It’s brewed with Guinness Ale yeast and 100 percent Irish wheat. Guinness Irish Wheat is a full-bodied wheat beer with clean, crisp refreshing taste and notes of zesty citrus—perfect for any summer occasion. 84

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Yowie Surpise With Collectible Animals Yowie Surprise is a 1-ounce premium milk chocolate shell with a capsule that hides one of 26 collectible endangered species animals or Yowie story characters. The Yowie chocolate is foil wrapped with one of six vibrant Yowie character foils designed specifically for strong retail shelf presence and in-store impact. The Yowie mission is to educate chocolate fans by introducing carefully crafted, scientifically accurate Yowie playmates complete with a Yowie information leaflet, profiling the animal, its habitat, food sources, and threats to the animal and its environment. Each animal's conservation status is color-coded and rarity scale is included continued on page 86

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to drive impulse purchasers into longterm collectors. The Rescue Series includes 26 out of the 75 endangered

animal species and characters in the collection, and Yowie proudly supports the Wildlife Conservation Society in their efforts to preserve habits of high-risk species.

Advertiserâ&#x20AC;&#x2122;s Index

Yowie Surprise Rescue Series includes one of 26 collectible endangered species animals.

Altria.....................................35 Anheuser Busch....................10 Aon Risk Services..................20 AT&T .....................................89 Blue Bunny ...........................17 Bug Juice ..............................61 Chobani ................................73 Coca-Cola.......................cover 2 Cookies United......................71 Dean Foods .............................8 Diageo Guinness...................25 Dr Pepper Snapple................37

Foreign Candy.......................65 Fiji/Wonderful ......................79 Gas Monkey ..........................88 Good2Grow...........................86 Hormel..................................50 Kellogg's........................4-5, 44 Kraft......................................83 Kretek .....................57, cover 4 Lifeway Foods.......................77 Living Essentials ...................85 Logic Ecig.........................46-47 Mars Ice Cream .....................28

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Maruchan .............................38 McLane .................................32 Miller .......................34, cover 3 Mondelez..............................19 Morinaga..............................43 National Tobacco...................74 Nestle Ice Cream...................67 Nestle Professional ...............69 Organic Valley.......................80 P&G Acosta .......................6, 55 Pepsi Quaker...................15, 30 Perfetti Van Mele..................41

PWM.....................................54 Reynolds American...............31 Seneca.............................26-27 Shamrock..............................21 Simply Orange ................12-13 Swedish Match .................7, 58 Swisher ............................3, 63 Vixxo .....................................76 Whitewave Foods...................9 Yowie....................................53

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FOA Board Meeting Dates 7-Eleven FOAC

Central Florida FOA

Midwest FOA

Phone: 347-251-1828

Phone: 815-210-2950

May 17, 2018 August 16, 2018 November 8, 2018

CHICAGO DATES (Co-hosted with Alliance of 7-Eleven Franchisees FOA)

Columbia Pacific FOA Phone: 503-998-5941

September 27, 2018—General Meeting MICHIGAN DATES October 4, 2018—General Meeting

May 24, 2018—Board Meeting August 21, 2018—General Members Meeting September 20, 2018—Board Meeting October 25, 2018—Board Meeting

Phone: 847-353-9999 May 31, 2018—Board Meeting July 19, 2018—Board Meeting August 30, 2018—Board Meeting September 27, 2018—Board & General Meeting October 25, 2018—Board Meeting November 29, 2018—Board Meeting December 13, 2018—Board Meeting

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.

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foa events National Coalition Board of Directors Meeting San Juan Marriott Resort San Juan, Puerto Rico May 9-11, 2018

Texas FOA Trade Show

Midwest FOA/Alliance of 7-Eleven Franchisees FOA Trade Show Donald E. Stephens Convention Center Rosemont, Illinois June 19, 2018 Phone: 815-210-2950

South Texas FOA Trade Show & Golf Tournament

(venue to be announced) May 23, 2018 Phone: 214-208-0992

Hyatt Regency Hill Country Resort San Antonio, Texas June 21-22, 2018 Phone: 661-607-4013

Texas FOA Charity Golf Tournament

Midwest FOA Michigan Trade Show

Cowboys Golf Club Grapevine, Texas May 24, 2018 Phone: 817-797-4911

San Diego FOA Charity Golf Tournament Riverwalk Golf Club San Diego, California May 24, 2018 Phone: 619-713-2411

Utah FOA Trade Show & Golf Tournament Airport Hilton Doubletree Hotel Salt Lake City, Utah June 6-7, 2018 Phone: 801-450-4538

Eastern Virginia FOA Golf Tournament Sleepy Hole Golf Course Suffolk, Virginia June 6, 2018 Phone: 757-247-6152

Eastern Virginia FOA Annual Trade Show Hilton Garden Inn Suffolk Riverfront Suffolk, Virginia June 7, 2018 Phone: 757-247-6152

National Coalition 43rd Annual Convention & Trade Show July 23-26, 2018 Trade Show: July 25-26, 2018

Orlando, Florida

Somerset Inn Troy, Michigan June 27, 2018 Phone: 815-210-2950

Midwest FOA/ Alliance of 7-Eleven Franchisees FOA Golf Outing

7-Eleven FOAC Charity Golf Outing

St. Andrews Golf & Country Club West Chicago, Illinois August 22, 2018 Phone: 815-210-2950

St. Andrews Golf Course West Chicago, Illinois June 27, 2018 Phone: 847-353-9999

7-Eleven FOAC Annual Trade Show Odeum Expo Center Villa Park, Illinois June 28, 2018 Phone: 847-353-9999

7-Eleven FOAC Annual Picnic Forest Preserves of Cook County Busse Woods Grove 29 Elk Grove Village, Illinois July 21, 2018 Phone: 847-353-9999

Midwest FOA Michigan Golf Outing Somerset Inn Troy, Michigan August 16, 2018 Phone: 815-210-2950

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Gaylord Palms Resort & Convention Center

7-Eleven FOAC Holiday Trade Show (venue to be announced) November 15, 2018 Phone: 847-353-9999

Columbia Pacific FOA Holiday Party

San Diego FOA Day At The Races

(venue to be announced) December 1, 2018 Phone: 503-998-5941

Del Mar Thoroughbred Club Del Mar, California August 24, 2018 Phone: 619-713-2411

Midwest FOA/ Alliance of 7-Eleven Franchisees FOA

San Francisco/ Monterey Bay FOA Golf Tournament Castlewood Country Club Pleasanton, California September 10, 2018 Phone: 510-693-1492

San Diego FOA Vendor Appreciation Day AleSmith Brewing Company San Diego, California October 4, 2018 Phone: 619-713-2411

Holiday Party (venue to be announced) December 5, 2018 Phone: 815-210-2950

Midwest FOA Michigan Holiday Party Somerset Inn Troy, Michigan December 12, 2018 Phone: 815-210-2950

San Diego FOA Holiday Party San Diego Marriott San Diego, California December 15, 2018 Phone: 619-713-2411