Avanti September/October 2021

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September/October 2021




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Adjusting To The New Normal Labor Shortage, Higher Payrolls, Supply Chain Issues, Vaccination & Mask Mandates... The Time For Teamwork Is Now A Look Around The Corner Drive Your Enterprise ‘WHAT!’ Employee Safety Training Matters



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September/October 2021


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

33 ‘WHAT!’ B y Arnold J. Hauptman, Esq., General Counsel, UFOLINY

35 D rive Your Enterprise

Talk With Other Franchisees On Free Telegram App Page 10 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. 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.


Bits & Pieces......................................16

Join Your Local FOA.......................17


By John Harp, CSP, ARM—Risk Engineering Consultant, Mitsui Sumitomo Insurance Group

Member News............................8


37 Employee Safety Training Matters


B y Arfan “Art” Farooqi, Board Member, Central Florida FOA


41 Latest Franchisee Survey Finds Major Concerns In All Areas Of Our Businesses



29 A Look Around The Corner

13 A 1990 Newspaper Article About The Plight Of 7-Eleven Franchisees Still Rings True

Legislative Update..................................44


B y Jay Singh, NCASEF Chairman


12 NCASEF Petitions The FTC To Investigate Franchising And Protect Franchisees

SEI News.......................................................47


23 The Time For Teamwork Is Now

FOA Meetings Calendar................50 Vendor Focus.....52 Franchisee Calendar................54

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7-Eleven No. 2 On Franchise Times Top 400 List 7-Eleven is No. 2 on the new Franchise Times Top 400, an annual ranking of the largest U.S.-based franchise systems by 2020 global systemwide sales, the publication reported. 7-Eleven, with 72,374 total worldwide units (9,519 in the U.S.), generated $91.8 billion in 2020 sales, as estimated by Franchise Times. McDonald’s (39,198 total locations) “ 7-Eleven genretains the No. 1 erated $91.8 position by just billion in 2020 over $1 billion, sales, as estimateven as its systemwide sales ed by Franchise declined by 6.8 Times.” percent to $93.3 billion one year after cresting the $100 billion mark. KFC (21,057 units) comes in a distant third with nearly $26.3 billion in global sales. The only other convenience store chain in the top 10 is Circle K, at No. 7 with $15.2 billion in systemwide sales and 11,312 global stores. 7-Eleven pushed up systemwide sales by 3.1 percent in 2020 from the year before, according to the article. While the company ranked second in largest sales growth by dollars, up $2.8 billion, it was

first in unit growth, up 2,200 to 72,374. SEI COO Chris Tanco credits the sales increase to 7-Eleven’s designation as “essential” during the pandemic, plus quick work to respond when COVID-19 restrictions began. Work done before the pandemic also paid off last year, Tanco said, citing the expansion of the 7Now Delivery app to hundreds of more stores in 2018. “We grew our delivery sales by 500 percent throughout 2020, and as a consequence we got so bullish about it, we went from 2,000 stores by the end of 2020, close to 4,000 stores delivering today,” he said. Another new initiative is 7-Eleven’s Evolution stores, now numbering eight but with more on the horizon, which serve as laboratories to test different platforms that could then be retrofitted into the store standard. Tanco said sales in the Evolution stores are up to three times higher in some cases. The article states SEI is now focusing on its $21 billion acquisition of Speedway, which brings its North American portfolio to 14,000 stores.

2021 C-Store Sales Could Top Pre-Pandemic Levels Convenience store retailers are bullish about their sales for 2021—74 percent expect year-end in-store sales to be better than 2020, and 67 percent expect continued on page 10

The National Coalition Office

The strength of an independent trade association lies in its ability to promote, protect and advance the best interests of its members, something no single member or advisory group can achieve. The independent trade association can create a better understanding between its members and those with whom it deals. National Coalition offices are located in Universal City, Texas. 8

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702-249-3301 • jays@ncasef.com


347-251-1828 • mcjorg@yahoo.com


818-203-2527 • paullobana@aol.com Rehan Hashmi VICE CHAIRMAN

847-845-8477 • rehan711@yahoo.com


425-438-8381 • ajinderhanda@hotmail.com

Jaspreet Dhillon TREASURER

310-892-2106 • jaspakam@gmail.com Shawn Howard OFFICE ADMINISTRATOR

210-971-9211 • shawnh@ncasef.com


617-423-7250 • ekarp@wkwrlaw.com


262-394-5518 • johnr@jrplanners.com


267-994-4144 • avantimag@ncasef.com

Tricia Kessler ART DIRECTOR

215-500-3204 • design@kesslerdigital.com

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

The Voice of 7-Eleven Franchisees

September/October 2021

©2021 National Coalition of Associations of 7-Eleven Franchisees Avanti Magazine is the registered trademark of The National Coalition of Associations of 7-Eleven Franchisees.

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in-store sales will top sales in 2019, reported NACS Online, citing a NACS retailer member survey conducted in September 2021. Only 11 percent of retailers expect their year-end in-store sales to fall below year-end 2020 sales, and 13 percent say sales will be lower than 2019. Retailers are also optimistic about fuel sales—67 percent say they will be higher in 2021 than in 2020, while 16 percent estimate that they will drop, compared with 2020 sales. Opinions are more divided around 2021 fuels sales compared with those in 2019—36 percent say that sales will surpass totals from 2019, while 39 percent say they will decrease. The optimism related to 2021 sales is led by the return of the morning customer—53 percent of retailers say morning daypart sales increased compared with 2019, and 47 percent say lunch daypart sales increased. The only time period that did not see significant growth in sales compared with 2019 was late-night hours; only 24 percent of retailers say they saw an increase in sales during this period. While retailers are seeing strong sales that have returned to pre-pandemic levels, concerns remain as 75 percent of retailers are concerned about the labor shortage and finding qualified candidates, and 60 percent are concerned about supply chain shortages.

More People Shopping At C-Stores

sumers are shopping for fuel in 2021, up from 68 percent saying so in 2020; and 86 percent of respondents are paying close attention to retailers’ commitment to the safety of their employees. The “Buddy Up: C-Store Shopper Insights” report examines how the pandemic has influenced shopping behavior in the $650 billion fuel and convenience industry. The study combines consumer survey data from more than 15,000 convenience retail consumers across all key U.S. geographic locations and PDI consumer-buying data from 5,500 mid to large-size convenience retail sites across all key U.S. geographic locations from its Insight Cloud solution.

Job Openings Hit Another Record High In July Job openings in the U.S. rose to a record high for the fifth consecutive month in July as demand for workers still outpaced hiring, reported Business Insider. Openings climbed to 10.9 million in July from 10.2 million, according to Job Openings and Labor Turnover Survey, or JOLTS, data published in September. Economists surveyed by Bloomberg expected openings to dip to 10 million. Openings shot higher through the spring as businesses faced unusual difficulty in hiring. The nationwide labor shortage was fueled by factors including enhanced unemployment benefits, school closures, and vi-

C-store shoppers have grown over 4 percent in the past year, according to the “Buddy Up: C-Store Shopper Insights” report by GasBuddy and Pro“ Job openings in the U.S. rose fessional Datasolutions, Inc. (PDI). By comparison, there was5 percent to a record high for the fifth growth in grocery and 6 percent in consecutive month in July dollar stores. The report further reas demand for workers still veals that younger, female shoppers outpaced hiring.” make up a majority of the c-store customer base; 75 percent of con10

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rus fears. As businesses prepared for reopening and a wave of spending, jobless Americans were in no rush to get back to work. Openings rose at a slower pace through the summer as job growth soared. The U.S. added 962,000 jobs in June and another 1.1 million payrolls in July as vaccination and the reversal of lockdown measures boosted the labor market’s recovery. The hiring frenzy continued on page 14

Talk With Other Franchisees On Free Telegram App National Coalition members are using a new app to discuss issues, make announce- ments, post information and send files. It’s called Telegram and will accommodate many more than the 250 group member limit of WhatsApp. We already have more than 400 members on Telegram, and we encourage you to down- load the free app onto your phone or desktop and sign on using the following link: https://t.me/joinchat/QR1k9Efl4QmXqtIFtpaCkQ. There are just a few basic rules: 1. Must be a franchisee and paying member of an FOA affiliated with the National Coalition. 2. Not a member of an FOA? Join one ASAP or become a National Coalition Member at Large. 3. Display your full name and area on your profile so issues can be related to that area. 4. If your full name is not displayed, you will be removed. 5. Posts should be strictly business related. 6. Pro SEI? No problem—we all are, that is why we are franchisees. FOA/National Coalition haters, please stay away. 7. Encourage your fellow franchisees to join. 8. STAY UNITED. LOVE YOU ALL.

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NCASEF NCASEF Petitions The FTC To Investigate Franchising And Protect Franchisees Franchisees in the 7-Eleven system have known for a long time that franchisors don’t always act in their operators’ best interest. That was clear in the recent National Coalition survey, which showed a tremendous lack of trust between franchisees and franchisor. Now, NCASEF, with the support of other franchisee groups, has petitioned the U.S. Federal Trade Commission (FTC) to investigate 7-Eleven and other top chains in the industry. This petition, which we prepared with the help of with Keith Miller of Franchisee Advocacy Consulting, has been endorsed by 10 other independent franchise associations. It asks the FTC to compel 9 major franchise chains to respond to a staggering 115 requests for information in 14 categories, including supply chain, advertising funds and financial performance representations. We are pleased to say the petition has received the attention of members of the political, trade and local news media, including the Dallas Morning News, Yahoo! Finance, Convenience Store News, and The Hill. It is our hope our petition will prompt the FTC to extend federal regulation of franchising beyond the presale financial disclosures companies are already required “It is our hope to make. “This petition proour petition will prompt vides the opportunity for the FTC to take a proactive role the FTC to extend federal reguin assessing the franchise lation of franchising beyond the industry,” said Miller, a Subpresale financial disclosures way franchisee who was also part of the team that companies are already lobbied for fair franchising required to make.” legislation in California in 2016. “We are requesting the FTC look broadly at the imbalance of power in our industry today.” We are not alone in asking the FTC to step up. In April, Nevada Sen. Catherine Cortez Masto released a comprehensive report on franchising, which highlighted problematic areas in the industry and asked for increased Federal Trade 12

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HIGHLIGHTS Commission oversight. In “ THE PETITION ASKS June, Illinois Rep. Jan SchaTHE FTC TO COMPEL kowsky sent a letter to the Government Accountability Office (GAO) requesting 9 MAJOR FRANCHISE a study of inadequacies in the current CHAINS TO RESPOND TO FTC’s Franchise Rule. A STAGGERING 115 RE Thomas Ayres, a senior attorney QUESTS FOR INFORMAwith NCASEF law firm Witmer Karp TION IN 14 CATEGORIES, Warner & Ryan, who co-wrote the FTC petition, said, “Franchisors often engage INCLUDING SUPPLY in predatory behavior after franchisees CHAIN, ADVERTISING sign their contracts, but the FTC FUNDS AND FINANCIAL rarely investigates post-sale PERFORMANCE activities when franchisees are REPRESENTATIONS.” more vulnerable and captive to their franchisors.” It is encouraging that the FTC recently launched antitrust investigations of the technology and pharmaceutical sectors. In addition, former FTC Commissioner Rohit Chopra, who was recently sworn in as director of the U.S. Consumer Financial Protection Bureau, has been outspoken about the need to “stop unfair, deceptive and discriminatory practices that target franchisees and their employees.” He made the point as a keynote speaker at this year’s National Coalition convention and previously on CNBC, saying, “We ultimately want to make sure there is a fair playing field for both the franchisor and the franchisee.” The lack of fairness in franchising was also highlighted in a 2019 report by the Australia Parliamentary Joint Committee on Corporations and Financial Services, which detailed bad behavior by several franchisors—7-Eleven among them. “An important takeaway from the Australian report is that presale disclosure is an insufficient regulatory response to power imbalances, because it does not curb opportunistic and exploitative practices by some franchisors,” said Eric H. Karp, partner of Witmer Karp Warner & Ryan and former chair of the American Bar Association Forum on Franchising. Vimal Patel, a franchise owner of Q Hotels in Louisiana, who has filed suit against hotel franchisor IHG, expressed his support for the NCASEF/Franchisee Advocacy Consulting petition. “It’s time the FTC used its authority to look at the fairness and transparency in the franchise industry.” Attorney Ayres said current business conditions, which continued on next page

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NCASEF have been made worse by the global pandemic, further highlight the need for closer examination of franchising. “The additional strains the pandemic has put on franchisees across all industries has brought into sharper focus the need for further investigation and action.” The petition recommends the FTC send requests for information to these franchise systems: 7-Eleven, Subway, The UPS Store, IHG Hotels and Resorts, Choice Hotels, Experimax/Experimac, Supercuts, Massage Envy, and Dickey’s Barbecue Pit.

A 1990 Newspaper Article About The Plight Of 7-Eleven Franchisees Still Rings True The year was 1990 and Stuart Silverstein, a writer from the Los Angeles Times, took an in-depth look at the issues between 7-Eleven franchisees and the franchisor, then known as Southland. This article was brought to our attention after we published the results of our latest survey. What’s incredible is that this piece could just as easily be published in the paper today; the problems from 31 years ago are still relevant today—in many instances, they’re worse. Much of Silverstein’s article centered on the challenges franchisees faced, many of which were attributed to unfair management practices. He also mentioned crumbling infrastructure due to poor “ WHAT’S INCREDIBLE IS THAT THIS PIECE upkeep, and COULD JUST AS EASILY BE PUBLISHED IN why franchisee THE PAPER TODAY; THE PROBLEMS FROM 31 profitability YEARS AGO ARE STILL RELEVANT TODAY—IN was slipping. These topics MANY INSTANCES, THEY’RE WORSE.” were all included in the National Coalition’s 2021 survey and they remain the top concerns to the vast majority of this year’s survey respondents. Let’s start by looking at the bottom line, Question No. 31 on the survey: “The structure of our contract allows me to make a reasonable profit.” Eightyeight percent of you disagreed with that statement today. In 1990, the LA Times said, “Profits, however, usually are hard-earned by franchisees, who in many cases, run their stores with the help of spouses and children.” Years before 7-Eleven Inc. (SEI) formalized its graduated gross profit split (GGPS), Silverstein exposed the franchisor’s practice of having operators

HIGHLIGHTS pay a portion of their profits in lieu of a traditional royalty fee, writing: “The parent company normally returns half of what its accountants determine to be a store’s gross profits to the franchisee and keeps the rest. In other organizations, franchisees simply pay a fixed percentage of sales to the parent company.” Back then, franchisees in California were suing 7-Eleven, claiming the company “Tops among the prematurely charged important issues today are them interest on invoices a nationwide staffing shortage, before Southland paid the cost of goods/shrinking gross profit bills. Today, franchisees margin, franchisee net income and question whether SEI’s accounting systems are 24-hour operations. Again, the accurate. It’s no wonder article echoed 1990 trust remains a critical issue similar concerns.” in the 7-Eleven franchisee/ franchisor relationship. It should be no surprise that many franchisees have trust issues in a system that still has many of the same concerns all these years later,” said NCASEF Executive Vice-Chairman Michael Jorgensen. “Trust is a key component of any business relationship and contract. Difficult to decipher accounting practices, coupled with our franchisor taking a bigger piece of the pie at a time when our responsibilities and expenses are increasing have left many of us feeling disenfranchised. Add to this picture the labor shortage and you see why more than 80 percent of survey respondents believe that running the stores has negatively impacted their physical and mental health.” The upkeep and maintenance of our stores remain a concern. Sixty percent of 2021 survey respondents said it had been over 10 years since their stores received a major physical plant upgrade (valued at more than $10,000). Back in 1990, crumbling stores were also an issue. Silverstein wrote that franchisees watched their stores become rundown because remodeling money was being funneled to pay off the franchisor’s corporate debts. Recently, SEI has spent $28.3 billion in 39 separate acquisitions, without investing in many continued on page 41

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slowed sharply in August, but the latest JOLTS data shows labor demand was still strong the month prior amid stellar job creation.

Study Finds Pandemic Led To Increase In Retail Crime Organized retail crime and numerous other security concerns evolved in 2020, and most retailers attribute the increase in criminal activity to the pandemic, according to the 2021 Retail Security Survey released by the National Retail Federation. The COVID-19 pandemic impacted the risk environment for retailers on several fronts. While more than two-thirds (69 percent) said the pandemic resulted in an increase in overall risk for their organization, respondents specifically mentioned the impact on workplace violence (61 percent) and organized retail crime (57 percent). Mandated store shutdowns and other shopping restrictions that occurred throughout 2020 had an impact on where fraudulent activity occurred. More than one-third (39 percent) of respondents said they saw the greatest increase in fraud in multichannel sales channels such as buy online pick up in store, up from 19 percent the year before. In contrast, just 28 percent said the greatest increase in fraud came from in-store-only sales, down from 49 percent the year before. The percent of those who pointed to online-only sales fraud remained flat.

Food Prices To Rise Food prices across categories are predicted to rise low- to mid-single digits this year and again next year—adding on to already higher prices in 2020 fueled in part by the pandemic and raising questions about how consumers will react in the long term, reported FoodNavigator-USA. com. According to recent data released by 14

the U.S. Department of Agriculture’s Economic Research Service (ERS), the price of food consumed at home is now expected to increase between 2.5 and 3.5 percent and food consumed away from home is expected to increase 3.4 to 4.5 percent in 2021 over 2020. The agency predicts this trend will continue in the coming year with at-home prices climbing an additional 1.5 to 2.5 percent and away-from-home prices increasing between 3 and 4 percent. This is on top of dramatic increases last year compared to pre-pandemic levels. In 2020, the price of food consumed at home increased 3.5 percent compared to only 0.9 percent in 2019 before the coronavirus outbreak. Last year, foodaway-from-home climbed 3.4 percent, according to the USDA. The brunt of the price increases in 2020 was led by meat with beef and veal climbing 9.6 percent year-over-year, pork up 6.3 percent, and poultry 5.6 percent. This was followed by a 4.4 percent increase in dairy prices and a 4.3 percent increase in eggs, according to ERS. Dramatic increases in the producer price index suggest that meat prices will continue to climb in the future.

Jacksons Food Stores Completes Speedway & 7-Eleven Acquisition Jacksons Food Stores recently completed its acquisition of 62 Speedway and 7-Eleven convenience stores with fuels in California, Arizona and Nevada from SEI, reported Petrol Plaza. The

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stores purchased were among the 293 locations that 7-Eleven is divesting to satisfy an agreement with the Federal Trade Commission (FTC) as part of its recent acquisition of Speedway LLC from Marathon Petroleum Corp. The Meridian, Idaho-based family of Jackson companies own, operate and supply more than 1,340 stores across nine western states. The acquisition is part of the company’s continued focus on growth “ Jacksons Food and expansion Stores recently into additional completed its markets across acquisition of the Western 62 Speedway U.S. and will give Jacksons and 7-Eleven 58 stores in convenience attractive Calstores from SEI.” ifornia market.

Japan 7-Eleven Stores To Add Delivery Service Japan’s top convenience store operator, Seven & i Holdings, will launch delivery services nationwide as early as 2026, reported Nikkei Asia. The company expects to be able to deliver food and dairy products to homes in as little as 30 minutes from its 20,000 7-Eleven stores. It intends to start offering the service in fiscal 2026 and compete with e-commerce giants such as Amazon.com. The move comes amid a slump in Japan’s convenience store market. According to a Nikkei survey, industrywide sales fell 6.1 percent to around 11.8 trillion yen in 2020, marking the first decline since 1981. At the same time, Japan’s e-commerce market grew 22 percent, to around 12.2 trillion yen, partly thanks to the rise of stay-at-home consumption. E-commerce sales surpassed those of convenience chains for the first time in 2020. Seven & i, which will outsource delivery to local providers, has already continued on page 16

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established partnerships with about 10 logistics companies. It has also developed an AI-based logistics platform to optimize routes and coordinate among drivers. This enables its partner companies to deliver Seven & i products with a minimum of cars and drivers while also catering to other customers’ needs. Expectations are that the delivery service will raise each store’s sales.

First In-Person NACS Show In Two Years Attracts Record Crowds

The live and inperson 2021 NACS Show delivered four days of learnings, insights, networking and exploring what’s new and exciting for the convenience and fuel retailing industry. This year’s event took place October 5-8 at McCormick Place in Chicago and attracted 17,273 attendees, Workers left their jobs at a record including 5,039 buyers. The NACS Show pace in August, with bar and restaurant expo featured 1,235 exhibitors from startups employees as well as retail staff quitting to big brands, including a record-breaking in droves, reported CNBC, citing data 388 new exhibitors offering retailers a sneak from the Labor Department. Quits hit a peek at the new products available for connew series high, as 4.3 million workers venience stores, NACS announced. left their jobs. The quits rate rose to 2.9 In addition, the Cool New Products percent, an increase of 242,000 from the Preview Room allowed attendees to previous month, which saw a rate of 2.7 quickly preview 277 of the latest prodpercent, according to the department’s ucts and services available to the conJob Openings and Labor Turnover Survenience store industry. New this year, vey. The rate, which is measured against attendees used the NACS My Show total employment, is the highest in a data Planner app to collect details about the series that goes back to December 2000. products. With each scan, attendees A total of 892,000 workers in the food could store a “personal shopping list” service and accommodation industries of products to check out on the expo left their jobs, while 721,000 retail workfloor within the app. The Preview Room ers departed along with 534,000 in health boasted 11,350 total product scans. care and social assistance. As the convenience retailing indus Quits have been seen historically as try continues to thrive in today’s cona level of confidence from workers who stantly evolving retail environment, the feel they are secure in finding employNACS Show’s 40-plus education sesment elsewhere, though labor dynamics sions, designed by retailers for retailhave changed during COVID-19 crisis. ers, helped attendees solve strategic Workers have left their jobs because of challenges around core business funchealth concerns and childcare issues tions relating to foodservice, techunique to the pandemic’s circumstances. nology, consumer insights, category management, fuels “ Workers left their jobs at a record pace and human resourcin August, with retail and restaurant es/labor. NACS said its 2022 expo will employees quitting in droves.”

Record Number Of Retail Workers Quit Their Jobs

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Dollar Tree, the last of the big dollar store chains to sell items for $1 or less, is adding $1.25 and $1.50 price points in some stores as the company faces rising costs, reported Business Insider. The retailer will also increase the number of items it sells for $3 and $5 through its “Dollar Tree Plus” sections, with the goal of adding the sections at 500 stores or more by 2024. • Swisher recently announced the retirement of John Miller from his position as Chief Executive Officer and President. Neil Kiely, a member of the Board of Directors, has assumed the role of President of Swisher. Kiely most recently served as the Chief Executive Officer/Vice-Chairperson-Board of Directors for Birra Peroni and was previously Chief Transformation Officer at MillerCoors. • A new way to pick-up groceries is now open in Mount Pleasant, South Carolina—OPIE Drive-Thru Grocery allows customers to pick-up their groceries without ever leaving their car, reported WCBD News 2. The 24 hour, 7 days a week, full service drive-thru convenience grocery store allows customers to order ahead, pull-up to the store, and pick their groceries up within minutes. • Swedish Match recently announced that it intends to separate its cigar business via a spin-off to shareholders and to completely exit the manufacturing of combustible tobacco products. The company said it has initiated preparations for a separation and a subsequent listing on a major U.S. securities exchange. The separation is expected to be completed during the second half of 2022, at the earliest. • A Dunkin’ doughnut shop in Colorado recently closed its doors for several weeks because it couldn’t find enough workers, reported The Gazette. The location normally operates with 15 employees and had just three when it closed. • Supply chain problems will likely persist at least through next spring, making it difficult to find hot toys and gifts this holiday season, as well as basic staples like coffee and footwear, reported Axios. Stores of all sizes and specialties are already trying to hoard products in warehouses—from turkeys, stuffing and cranberry sauce to video game consoles. • An Australian privacy commission said 7-Eleven Australia breached customer privacy by gathering facial imagery data without concontinued on page 34

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take place October 1-4 in Las Vegas at the Las Vegas Convention Center.

SEI Integrating Speedway HQ Fewer than 35 people have been laid off at the Speedway headquarters in Enon, Ohio as SEI continues integrating the Speedway assets it acquired from Marathon Petroleum, reported the Springfield News-Sun. The $21 billion acquisition closed in May. SEI representatives told the newspaper that as a result, decisions had been made to reduce staff in some areas, which included consolidating duplicate roles and aligning responsibilities. The exact number of people laid off has not been released by the company, nor the time period in which the elimination of certain roles have occurred, according to the article. SEI said that in the last several months the company has made significant prog-

ress toward fully combining Speedway and 7-Eleven. That includes the designing of an organizational structure that will better position “the combined company for success in the near-term and for many years to come.”

“ The FTC plans to deter ‘unlawful’ mergers in the oil and gas industry that may harm consumers at the gasoline pump.”

FTC To Investigate ‘Unlawful’ Oil Industry Mergers

es through collusive practices, and I will direct our staff to investigate any signs of this type of conduct.” Khan also said she also was concerned that the FTC’s approach to merger reviews in recent years had “enabled” significant consolidation in the industry and created “conditions ripe for price coordination and other collusive practices.” To tackle the issue, Khan said the FTC would “identify additional legal theories” to challenge mergers in which dominant players in the industry were buying up family-run businesses. She said the commission would also study its policies that

The Federal Trade Commission plans to crack down on practices that may harm consumers at the gasoline pump and seek to deter “unlawful” mergers in the oil and gas industry, reported Reuters. In a letter to the White House, FTC Chair Lina Khan promised to start an investigation of abuses in the “franchise market” for retail fuel stations, among other steps. Khan informed the White House that she is “especially interested in ways that large national chains may ‘restore’ higher pric-

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require divestitures during mergers of gas stations in overlapping markets to ensure that was not encouraging further consolidation and anticompetitive behavior.

Wawa Adding Self-Checkouts Kiosks Wawa is adding self-checkout kiosks to its convenience stores that let customers buy coffee and hoagies without the help of a cashier, reported the Philadelphia Inquirer. The company has installed the machines in 61 stores and continues to roll them out in more locations. Wawa said all new stores will open with self-checkout as an option. The company piloted self-checkout in a few dozen locations and found that the kiosks moved customers through stores faster. It also allowed Wawa to offer a more socially distanced checkout option during the pandemic.

Couche-Tard’s Net Earnings Drop For its first quarter of fiscal 2022, Circle K parent company Alimentation Couche-Tard Inc. announced adjusted net earnings of $758.0 million, a decrease of $37.0 million, or 4.7 percent, driven by lower road transportation fuel margins in the United States and higher operating expenses. Total merchandise and service revenues were $4.1 billion, an increase of 5.4 percent. Same-store merchandise revenues decreased 0.2 percent in the United States and 9.6 percent in Canada, and increased 5.9 percent in Europe and other regions. On a 2-year basis, same-store 18

merchandise revenues increased at a compound “ Since reaching $34 in March of annual growth rate of 2020, average shopping spending 3.7 percent in the United States, 4.9 percent in Euhas remained elevated at or above rope, and 4.2 percent in that amount through July 2021.” Canada, the company said. Merchandise and service gross margin amount spent per shopping occasion has decreased 0.1 percent in the United been between 13 percent and 29 percent States to 34.2 percent, and 2.2 percent higher than the same month in the priin Europe and other regions to 38.4 or year. Those new spending levels have percent, which was impacted by the held relatively steady since March 2021. integration of Circle K Hong Kong. Grocery and drug stores, warehouse Gross margin in Canada increased 1.2 clubs, hardware and farm stores, and percent to 32.3 percent, due to favormass merchants have enjoyed the stronable changes in product mix. Samegest growth in spending per-shopping store road transportation fuel volume occasion since the start of the pandemic, increased 11.8 percent in the United across the combined in-store and onStates, 6.3 percent in Europe and other line retail landscape. The amount spent regions, and 10.4 percent in Canada, due per shopping occasion through July of to higher fuel demand compared to the this year at each channel averaged at corresponding quarter. least 20 percent higher than 2019 lev-

Pandemic Lifted Average Retail Spending The COVID-19 pandemic has led to an increase in the average amount U.S. consumers spend on each shopping occasion, whether it is a trip to a physical store or a visit to an online shopping site. Since reaching $34 in March of 2020, average shopping occasion spending has remained elevated at or above that amount through July 2021, according to The NPD Group. This increase is partially due to a general shift toward online purchasing, where average selling prices (ASPs) and the amount spent on each transaction already tended to be higher. However, the number of shopping occasions per week still falls short of 2019 levels, indicating that the sales lift is primarily caused by an increase in stock-up purchasing behavior, as consumers buy more on each occasion. In each of the 12 months since March 2020, the average

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els. Warehouse clubs, and hardware and farm stores are two channels that experienced an increase in combined in-store and online shopping visits, but their overall gains still pale in comparison to pure-play online retailers which have increased shopping visits 49 percent compared to 2019.

Attorneys General Threaten Lawsuit Over Vaccine Mandates Twenty-four attorneys general recently sent a letter to the White House warning of impending legal action if a proposed COVID-19 vaccine requirement for as many as 100 million Americans goes into effect, reported Fox News. The letter is the latest GOP opposition to sweeping new federal vaccine requirements for private-sector employees, health care workers and federal contractors announced by Biden in early September. The requirement, to be enacted through continued on page 21

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a rule from the Occupational Safety and Health Administration OSHA), is part of an all-out effort to curb the surging COVID-19 delta variant. The OSHA rule, which covers nearly two-thirds of the private sector workforce, would last six months, after which it must be replaced by a permanent measure. Employers that don’t comply could face penalties of up to $13,600 per violation. Once it’s out, the rule would take effect in 29 states where OSHA has jurisdiction. Other states like California and North Carolina that have their own federally approved workplace safety agencies would have up to 30 days to adopt equivalent measures. The letter was signed by attorneys general in Alabama, Alaska, Arizona, Arkansas, Florida, Georgia, Indiana, Kansas, Kentucky, Louisiana, Mississippi, Missouri, Montana, Nebraska, New Hampshire, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Texas, Utah, West Virginia and Wyoming.

U.S. labor market, the article states. Fewer Americans are seeking jobless claims just as openings have hit a record in the reopening economy. Amazon is hiring workers to help run 100 logistics facilities launched in September in the United States, on top of more than 250 that opened earlier this year. Some workers will aid in Amazon’s long-in-the-works effort to roll out one-day delivery for Prime loyalty club members, the company said.

Dollar General Goes On A Hiring Spree

Dollar General has added 50,000 new employees since mid-July using a slew of incentives, including sign-on bonuses for truck drivers and referral bonuses for supply chain employees, reported Progressive Grocer. But the retailer is not done with its latest hiring spree yet and is looking to hire additional employees for positions currently available in stores, distribution centers, the DG Private Fleet and Store Support Center. Dollar General is currently of Amazon has increased its average fering a $5,000 sign-on bonus to drivers starting wage in the United States to more with an active Commercial Driver’s License (CDL) hired now through January than $18 an hour and plans to hire another 125,000 warehouse and transportation 28 to be paid within the employees’ first workers, reported Reuters. The online six months of service. The company is retailer has raised pay from an average of also offering truck drivers robust bonus around $17 since May. In some locations, opportunities, including referral, performance and retention bonuses. the company is giving signing bonuses of Career opportunities at Dollar Gen$3,000, or triple what the company offered eral’s 27 traditional (dry) and DG Fresh four months ago. The fatter paycheck distribution centers are also currently shows how big employers are desperate available in general warehouse, human to draw workers in an increasingly tight resources, inventory control, maintenance, training “ Amazon has increased its average starting and administration wage to more than $18 an hour and plans areas. Additionally, to hire another 125,000 workers.” current Dollar General supply chain

Amazon Increases Average Starting Pay To $18

employees may participate in an internal job referral program, earning unlimited bonuses for each successful candidate referred. The company offers eligible employees 401k savings and retirement plans, and competitive health and wellness benefits including day-one telemedicine eligibility with no co-pay. Other benefits include tuition reimbursement, paid parental leave and adoption assistance to eligible employees, and the Employee Assistance Foundation. Dollar General has more than 17,600 stores in 46 states.

Three Percent Of Violent Crimes Occur At C-Stores C-stores accounted for roughly 3 percent of violent crimes overall in 2020 and gas stations accounted for about 2 percent, reported CSP Daily News, citing new FBI statistics. Out of a total of 675,715 violent crimes represented by National Incident-Based Reporting System (NIBRS) data, 20,108 incidents occurred at c-stores in 2020 and 11,795 occurred at gas station. These statistics make c-stores and gas stations the fourth and seventh most common locations for violent crime, respectively. Restaurants are the eight most common locations, the article states. Of the violent crimes that the FBI covers in the report, 157 or 2 percent of the 10,440 total crimes at c-stores were homicides; 119 or 1 percent of the total crimes at gas stations were homicides. The FBI reported 137,556 total robberies, 13,721 or 10 percent were at c-stores, while 7,006 or 5 percent were at gas stations.

Retail Fraud Up From Pre-Pandemic Period The cost and volume of retail and e-commerce fraud has risen significantly continued on page 42

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The Time For Teamwork Is Now BY JAY SINGH | C H A I R M A N , N C A S E F ; P R E S I D E N T , S O U T H T E X A S F O A

If there was ever a time when SEI and franchisees had to team up as true partners, now is it. We’re facing many external problems—labor and supply chain issues being at the top—and it is becoming increasingly urgent that SEI sit down with franchisees to develop viable solutions that will benefit all parties. This includes working together on new programs and promotions and system upgrades, and how they roll out. There’s no question that the pandemic has changed the convenience store industry, perhaps permanently, and we must adapt to our new reality. It is no longer “business as usual” for us as we find ourselves competing with the likes of Walmart, Target and Amazon for workers while trying to keep our shelves fully stocked, our stores clean, and our customers happy. Supply chain problems have been plaguing us for over a year now and will continue to do so into the first half of next year, according to recent news reports. Many of our vendors are struggling to get the raw materials they need to make their products and have reduced the number of SKUs they offer to only a few. Our vendors are also having trouble finding truck drivers to deliver their products to our stores. At the heart of all these problems is the labor shortage. The general consensus amongst employers was that people would begin to apply for work en masse once the $300 weekly unemployment supplement ex-

pired in September. We are now a couple of months past that deadline and the situation has not improved. The news these days is full of stories telling us that the unemployed had plenty of time during the pandemic to evaluate their priorities and think about what they truly want in a job. Regrettably for the c-store and retail sectors, most people want higher pay, benefits like heath insurance, paid time off and a retirement plan, and a set work schedule that doesn’t change weekly. And forget about finding anyone willing to work the night shift.

Although our franchisor has been trying to help us find suitable employees through its Hire Right program and partnership with Indeed.com, little has been done to help us attract and retain reliable workers. By the looks of it, many of us will have no choice but to increase our starting compensation to $15 per hour. That is why it is critical for SEI to sit down with franchisee leadership and hammer out a plan that “ It is no longer ‘business as usual’ would allow us to deal with higher payrolls. SEI for us as we find ourselves competcould give us a bigger cut ing for workers while trying to keep of the gasoline sales, or our shelves fully stocked, our stores we could adjust the gross clean, and our customers happy.” profit split, or make the

“We’re facing many external problems—labor and supply chain issues being at the top—and it is becoming increasingly urgent that SEI sit down with franchisees to develop viable solutions.” solution a combination of both. Perhaps part of the solution lies in lobbying Congress for universal healthcare and subsidized daycare so it takes the burden off employers with limited resources to offer these benefits. Whatever the case, a sit-down with our franchisor is warranted. As it stands, if this labor situation continues much longer—unless SEI plans to deploy robots or self-checkout in our stores—it may reach the point where the company has to seriously reconsider its 24/7 operation. I’m sure our franchisor would not welcome this, as 7-Eleven’s reputation was built on being open around the clock. However, the longer we wait to solve the labor problem, the further behind we’ll fall to our competitors in hiring and keeping dependable employees. As we deal with the issues brought upon us by the pandemic, it certainly doesn’t help matters when SEI decides to roll out a new and not fully tested programs into our stores, like the ASI 2 accounting system. continued on page 24

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The Time For Teamwork Is Now continued from page 23

Some of ASI 2’s features were made with little input from franchisees and accounting professionals with retail accounting expertise, and as a result caused big problems in many stores. Although SEI did not seek collaboration with franchisee leadership on this endeavor, we are still very willing to help to improve it. The point is franchisees want to participate in developing solutions. We can provide insight from the front lines because we are dealing directly with

“ Although our franchisor has been trying to help us find suitable employees through its Hire Right program and partnership with Indeed. com, little has been done to help us attract and retain reliable workers.”


“ We know what needs to be improved, and within the NCASEF there is a brain trust of franchisees with expertise in many fields who can provide valuable input.” these issues, with the labor shortage, with delivery issues, with a buggy accounting system, and poorly thoughtout programs. We know what needs to be improved, and within the NCASEF there is a brain trust of franchisees with expertise in many fields who can provide valuable input. Analyzing data on a computer screen at corporate will only get you so far. Input from soldiers on the front lines will take you the rest of the way.

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7-Eleven is the top convenience store chain in the world. Most recently it placed #2 on the Franchise Times Top 400 list, which ranks the largest U.S.-based franchise systems based on global sales. At the end of the day, we all have the same goal—to make sure our stores and our brand prosper. JAY SINGH CAN BE REACHED AT

702-249-3301 or jays@ncasef.com

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A Look Around The Corner BY ER I C H . K A R P, E SQ . | G E N E R A L C O U N S E L T O N C A S E F

For several years, we have been observing that the investor community does not respect the earnings of the publicly held parent company of your franchisor. For a specific example, we can cite the fact that for the 12 months ended October 7, 2021, the stock of the parent company declined in value by about 2.5 percent while the S&P 500 rose approximately 30 percent. We see that as one of the main drivers for the opportunistic behavior of 7-Eleven, Inc. given the materiality of its cash flow to the parent company. It therefore comes as little surprise that ValueAct Capital, a prominent activist investor firm, was reported in May to have amassed a $4.4 billion stake in Seven & i, amounting to about 4.4 percent of the company. You can read about ValueAct here: https://valueact.com. According to Bloomberg Law, ranked by market share, Seven & i is the 5th largest company to be targeted by activist shareholders. In a letter to its shareholders as reported in the financial media, ValueAct argued that management should focus much more of its attention on its core convenience store business, which it characterized as “high return” for shareholders. ValueAct argued that the company could be worth more than double its current market capitalization by making changes which might include spinning out the convenience store

business into a separate company. While we have not seen the letter, none of the descriptions of it in the media indicate that it has any reference to the franchisees of 7-Eleven, and in particular their financial interests and concerns. In what some will undoubtedly see as a related development, on July 1, 2021, Seven & i issued a 64-slide Medium Term Management Plan 2021-2025, which is publicly available in the Investor Relations section of the company’s website. This is a

blueprint for where management intends to take the company and it is hardly coincidental that many of its goals respond to the points raised by ValueAct. Here are some specific examples. • The number one goal of the Plan is to concentrate management resources with the U.S.-Japan convenience store business as a pillar of growth. This is a signal that the company intends to devote the lion’s share of its attention to the convenience store business as a pathway to wealth creation for the company’s shareholders. The company is signaling that there is going to be a more formal alliance between U.S.based and Japan-based “ The number one goal of the plan is to convenience store management. concentrate management resources • The financial metrics with the U.S.-Japan convenience store in the Plan are designed to communicate to the business as a pillar of growth.”

“ In a letter to Seven & i’s shareholders, ValueAct argued that management should focus much more of its attention on its core convenience store business, which it characterized as ‘high return’ for shareholders.” world that the company plans to grow materially, calling for a return on equity of 10 percent and an earnings per share growth rate of 15 percent or more. • The Plan calls for “business structural reform” by 2024, which includes “dealing with unprofitable stores” without specifying whether they intend to close them or invest capital in refurbishment and renovation. Seven & i has demonstrated that it is willing to spend tens of billions of dollars on acquisitions particularly focused on the gasoline segment but leave all too many franchised stores languishing in dire need of renovation, refurbishment, and improvement. • The group’s prior- “ The group’s ity strategy includes priority strat“strengthening relationship with fran- egy includes chisees” without one ‘strengthening word of how it will go relationship with about doing that. We franchisees’ have been representing franchisee associ- without one word ations throughout the of how it will go United States for more about doing that.” than three decades. We have never seen, nor have we ever been informed about, less collaborative or a more contentious relationship between the company and its franchisees. It is indeed alarming that this off-balance sheet liability of the company receives so little attention continued on page 30

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A Look Around The Corner generally, and specifically in the Plan. • Seven & i sees the United States convenience stores to be the main driver of growth in the convenience store group, aided by the recent acquisition and integration of the Speedway stores. This is seen as a way to increased shareholder value as a global brand. More specifically, the goal is that SEI, which currently accounts for 31 percent of the convenience store group’s cash flow, to generate 50 percent by 2026.

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• Goals for the U.S. network of stores include raising the store count to 15,000, increasing fresh food sales to 20 percent of revenue and raising delivery sales to 3 percent of total merchandise sales. As you know, delivery from U.S. stores is highly problematic for franchisees because the franchise agreement purports to give SEI unfettered discretion over how to divide the revenue and gross profit from that segment. • In order to expand delivery, the Plan is to drive the number of 7NOW Members to 55 million by 2025. Seven & i states that order-to-time delivery at 31 minutes is the fastest in the industry and that average “ More specifically, the goal is that SEI, spending per customwhich currently accounts for 31 percent of er is $14.50, about 1.7 the convenience store group’s cash flow, times the amount of in-store sales. There to generate 50 percent by 2026.” is no analysis of how


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“ Goals for the U.S. network of stores include raising the store count to 15,000, increasing fresh food sales to 20 percent of revenue and raising delivery sales to 3 percent of total merchandise sales.” these changes will affect franchisees. • Food Focused Growth is presented as another initiative based on collaboration with Warabeya dating to 2017 for 650 stores in the Dallas region. The aim is to build a highly efficient value chain involving a collaboration between SEI supply chain management, DHL and Warabeya. The plan involves a CDC commissary plant in Stafford, VA to supply approximately 1,300 stores and then to expand from there. How will this afcontinued on next page

A Look Around The Corner fect gross margin at the store level? The Plan does not say. • SEI will accelerate its goal of installing 250 electrical vehicle charging stations by 2027 to 500 stations by 2022, concentrating on California, Florida, Texas and Colorado. There is no indication of how the stores in these states will be chosen and it is not clear that this modest investment in electrical charging stations will meet consumer demands. General Motors touts its Path to an All Electric Future, predicting that it will have 30 new electrical vehicles on the road by 2025. https://www. gm.com/electric-vehicles.html • Another initiative is to roll out proprietary beverages, alcoholic beverages, in store cooking of croissants and cookies, and the Laredo Taco restaurant format to new and existing stores, including Speedway. The plan does not include any details

“ Seven & i is projecting that systemwide merchandise gross margin for calendar year 2021 will be a disappointing 33.9 percent. But it is also projecting that SEI’s operating income for 2021 will be up nearly 60 percent year-over-year.” regarding the number of stores or how much capital will be deployed. There is also no analysis about how these products will affect franchisee profitability. With the acquisition of the Speedway stores, 7-Eleven is a remarkably different company than it was a year ago. At present, about 62 percent of all stores have gasoline and about 45 percent are company owned. Seven & i is projecting that systemwide merchandise gross margin for calendar year 2021 will be a disappointing 33.9 percent. But it is also projecting that SEI’s operating income for 2021will be up nearly 60 percent year-over-year.

Retail fuel margin (33.06 cents per gallon for the six months ended June 30, 2021) remains well above pre-pandemic levels (21.07 cents per gallon for the six months ended June 30, 2019). If franchisees feel the ground shifting underneath them, it is not their imagination. At times like these, an activist, truth-telling, independent franchisee association that seeks to hold its franchisor accountable for its behavior is essential. ERIC KARP CAN BE REACHED AT

617-423-7250 or ekarp@wkwrlaw.com

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‘WHAT!’ AR N O LD J. H AU P T MAN , ES Q . | G E N E R A L C O U N S E L , U F O L I N Y

out of the system before you go broke, I am stores competing with each other, leaving litasked, “How long after a good will agreement tle opportunity to make a livable profit. This is signed can I expect to begin my retirement?” has been a long-time problem but has gotten Or for you younger people out there, “How worse over the last several years. In some arlong will it be before I can get out of this mess eas, stores are being built so close that a cusand maybe get a real paying job or a more lutomer has to figure out which store, a half mile apart, is more concrative business?” The answer, again in my experience, is generally nine venient to get to. It boggles months to a year. “WHAT! the mind to think how this I want out now!” Too bad. problem will be exacerbated “So what caused the because of the Speedway plummeting of the good purchase. For sure, it won’t value of my store?” A whole help. bunch of things that came 3. The 2019 Store together in a perfect storm. Agreement, simply They are: stated, stinks. The agree 1. Unless you have a ment places too many “ The dreams and plans mega volume store, or you costs on the shoulders of you may have had for have several decent stores, the franchisee. Insurance, there is little ability to earn a payroll preparation, adda well-deserved midreasonable living from your ed maintenance fees, and dle-class retirement store, even if you work 60a renewal fee of $50,000 or simply a change of 80+ hours a week and are are only a few of the new careers has evaporated, added burdens placed on getting free help from your kids. This is a 24/7 business the shoulders of the franand that is a shame.” with staffing being almost chisees. Least, but not last, impossible these days, resulting in franchi- is the onerous 7-Eleven charge that can be sees working the graveyard shift. Why would as high as 56 or 57 percent. Even lower-volanyone in their right mind invest somewhere ume stores paying 50 percent cannot survive around a half million dollars or more for a paying that percentage of its gross profit to return that is less or little more than can be 7-Eleven. As operating costs paid by the franearned in a decent job and without the prob- chisee increase, 7-Eleven’s share of gross profit lems of operating a business? The franchise is not diminished. Even worse, when the open fees are too high and are having the dual effect account falls below minimum, additional inof limiting the number of prospective buyers vestment, which you do not have, is demandand reducing the amount of money available ed. This is unfair and an impediment to the from a buyer for the good will sale of your store. of your store. Most franchises 4. I believe most potential good will pur“ Of course, the first question is, do not require a renewal fee, chasers start their search by going online to ‘What can I get for my store?’ but only a relatively small the 7-Eleven site and viewing a list of stores The answer I give is almost always transfer fee which makes lo- for sale, including corporate stores. I cannot prove it, but my gut tells me that SEI’s reps cations more attractive. met with a resounding, ‘WHAT!’” 2. There are too many continued on page 34 “WHAT!” It’s a weird title for an Avanti article, but that is what I hear several times from franchisees that call me for advice on the good will sale of their stores. With over 40 years of experience representing franchisees at the national level and in the New York areas covered by UFOLINY, I think I am qualified to render that advice. Of course, the first question is, “What can I get for my store?” The answer I give is almost always met with a resounding, “WHAT!” There is no precise answer to that question, but after representing dozens of franchisees selling the good will of their stores, I can render a pretty good and educated guess. After giving the franchisee that guess, the response inevitably is, “I could have gotten three times that amount seven or eight years ago.” That is correct, but not anymore. The dreams and plans you may have had for a well-deserved middle-class retirement or simply a change of careers has evaporated, and that is a shame. Some franchisees have busted their butts 20, 30, 40 years or more with the reasonable expectation that there would be some sort of reward for their efforts. Again, not anymore, and only some of the reasons, in my view, are stated below. Sometimes, when I go back and look at contracts for good will sales that I drew not that many years ago, I am literally shocked as to the severe diminishing value of 7-Eleven stores in today’s market. In the olden days, the good will proceeds was generally more than the franchise fee. Today, the opposite is true. When you finally decide that you must get

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‘WHAT!’ continued from page 33 are pushing underperforming “ There are too many stores competing corporate stores on unsophistiwith each other, leaving little opportunity cated and inexperienced potential to make a livable profit. This has been a buyers who see only an impressive brightly lit store with cars in the long-time problem but has gotten worse parking lot. Many of these stores over the last several years.” are corporate because franchisees just walked away from them and should be closed—not refranchised several times. That leaves your store at the bottom of the list. Some stores languish on the list for years and are often just removed in disgust. If you are an old timer and in the system prior to March 31, 1991, then there is one saving grace and that is the Long Term Tenure Rebate program. That is 30 years ago, but you would be surprised at the number of franchisees who are eligible for this rebate, which is equal to 50 percent of the franchise fee being charged to the buyer. For you newbies, there is nothing that 7-Eleven will reward you with for promoting the brand for many years. This program, in my memory, is the last time 7-Eleven significantly recognized the value of its franchisees to its brand. “WHAT,” you ask, “do I do now if I want out of the system before I go broke and there are no buyers for my stores?” The answer is a tough one and your only option might be to give the keys to 7-Eleven and start a new career or start retirement and think of your future rather than your past. I am sorry that this article is not upbeat, but the system for franchisees has just deteriorated so much (especially with the 2019 Store Agreement) that being optimistic ARNOLD J. HAUPTMAN is getting to be very hard. In any event, CAN BE REACHED AT ajhauptman@aol.com or 516 541-7200 I wish you all good luck.

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sent, reported Entrepreneur Magazine. The Information Commissioner’s Office said the data was collected illegally from June 2020 to August 2021 using camera-enabled tablets in 700 stores when customers completed voluntary surveys about their in-store experience. • Alimentation CoucheTard Inc. recently announced it has acquired convenience and fuel retail sites from ARS Fresno LLC that include 35 high quality locations currently operated under the Porter’s brand and located predominately in Oregon and Western Washington. • Bank of America is now paying its U.S. workforce at least $21 an hour, or nearly three times the federal minimum wage of $7.25, reported CBS News. The pay hike follows BofA’s May pledge to pay its workers a minimum hourly wage of $25 by 2025. The bank is also requiring its U.S. vendors pay their workers who are dedicated to the bank’s business at least $15 an hour. • Circle K recently announced that it is introducing fully frictionless technology at existing stores in Arizona. By adding this seamless checkout technology, the company said it is looking to enhance the shopping experience for both customers and team members. • Two new Whole continued from page 38

Avanti Is Your Magazine

Avanti Magazine was created in 1981 by franchisees, for franchisees. It represents your voice within the 7-Eleven universe and requires your participation to remain relevant to the ideas, information, and knowledge floating about the franchisee community. You can contribute to the success of Avanti Magazine by submitting any of the following: > Articles on any 7-Eleven topic that may be of interest to other franchisees. > Your FOA events and Board meeting calendars. > FOA event photos with a short description (who, what, where, when, and why). > Store or community event photos with captions. > Any combination of the above. Please send your submissions to avantimag@ncasef.com.

As former National Coalition Chairman Bill Schuessler famously said,

“None of us is as great as all of us together, so let’s stay tightly knit together.” 34

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Every day I have an 11.5-mile commute claiming, “CASH ONLY. Credit card system won’t have a boss to report to, or a routine from my home to my store. It is a drive so DOWN.” I have to drop everything and get workload that never changes. Most of all, they routine for me that sometimes I arrive at my to work contacting the 7-Eleven helpdesk to want to have the ability to drive their lives to the destination of their choice. store and cannot recall anything about the correct the issue. drive to work. I noticed nothing about my Recently, there was a law enforcement of- This made me realize that things aren’t that bad. The daily operasurroundings. I did not see the egrets flocked ficer waiting for my arrival to review the in the wetlands on the side of the highway, or night shift’s security camera footage tional challenges become the new billboard advertising a young injury for a possible crime outside my store. smaller the further I lawyers’ firm. The highway from my home is Needless to say, there is more deget from the ‘pity para beautiful course that takes me from South mand for, than supply of, my time. ty’ in my mind. When Tampa past downtown high-rises, through With all the endless daily chalI choose to savor the Historic Ybor City with its classic four-story lenges I am presented with, it would challenges and meet brick buildings, once home to the famous be easy to allow all these things to them head-on, I lay my Cuesta Ray cigar factory and Hav-A-Tampa distract me from the goal of makhead down at night and tobacco Company. No folks, sometimes I no- ing a living and providing a decent life for my family. If I allowed these tice none of it. “ As a franchisee, I need to That’s because I am too lost in my events to distract me from the repractice driving my store to the thoughts and plans for the day ahead, and I ality of me being in control of my am so busy thinking about the many chal- store, and navigating through these promised land of High ROI.” lenges my store faces in these uncertain times. daily obstacles, I would be lost and feel a sense of accomplishment and pride. Did the night shift fill my dairy case and ro- frustrated. As a franchisee, I need to practice driving tate the dates on the milk gallons? How many I am willing to share a secret with you. items was I short on my CDC delivery again? Many years ago, I was getting close to being my store to the promised land of High ROI Did the gas driver leave me the proper paper- burnt out and ready to leave the c-store busi- (Return on Investment). This is a place where work for the delivery to ness to go back to most businesspeople are trying to get. Howreconcile the daily tank “ If I allowed these events being an employ- ever, due to all the distractions along the way, inventory? What about ee. I thought the it is easy to be misdirected and get lost in the to distract me from the the health of my staff? lure of having a set minutia of the daily operations and challengHow do I convince the reality of me being in schedule, a regular es. Sometimes, being a part of such a powerful few vaccine holdouts to control of my store, and paycheck, and the brand, opportunity forces us to look in a difget the jab? These are of a two- ferent direction. But you must remember to be navigating through these dream just some of the quesweek, worry-free in the mindset to push your ROI to the place paid vacation that makes you love the challenges. This is what tions I contemplate on daily obstacles, I would would be awesome. driving to success is all about. Just remember my commute from my be lost and frustrated.” It sounded like a you have the power and control to take it to the home to my store. next level of sales and gross profit. Of course, when I arrive at my store there dream come true. are always new unknown challenges present However, as I spoke with my friends, I use the 80/20 rule to manage my daithat require my attention. Some days I have to many whom are IT professionals and work ly store routine. The rule states that you chase a critical supply item like hot dog buns for large firms whose names are posted at the should spend 80 percent of your time on because the CDC was unable to deliver any tops of tall buildings, I realized that they too the top 20 percent of things that make for the last five days, and we used the last of have a dream—they want the freedom to cre- you money and spend 20 percent of the our stock a few minutes ago. Other days there ate an enterprise that has unlimited potential remaining time on the 80 percent of tasks is a sign posted by the overwhelmed staff pro- to create wealth. They yearn for the time they continued on page 36 S E P T E M B E R | O C T O B E R 2 0 2 1 AVANTI


DRIVE YOUR ENTERPRISE that provide the least value to your bottom-line profit. For example, things in my top 20 percent that I dedicate most of my time to are: 1. Increasing total Gross Profit dollars. • Increase sales of High Margin categories. • Find ways to reduce costs of goods. • Reduce waste and write-off management. • Sourcing products to increase Margin or restock due to supply chain challenges. 2. Proper staff engagement and training. • Assist and train the staff to deal with the many store challenges. Support their work, and deal with their mental and emotional needs. • Manage the daily shift duty staff assignments. • Try to teach staff a new task to keep the job

“ The 80/20 rule states that you should spend 80 percent of your time on the top 20 percent of things that make you money and spend 20 percent of the remaining time on the 80 percent of tasks that provide the least value to your bottom-line profit.”


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“ You must remember to be in the mindset to push your ROI to the place that makes you love the challenges. This is what driving to success is all about.” engagement high. 3. Accurate accounting of all revenue and expenses. 4. Operational excellence and customer satisfaction as promoted by the 7-Eleven system. 5. In my opinion, the MOST important: I work on MY skills to be a better executive-level manager and franchisee. There are many distractions that may keep me from achieving my productivity goals; the many voices all around make focusing very difficult. Here are just a few of the items I put in the 80 percent that I spend the least time on. 1) Anything that does not involve increasing revenue, reducing costs, and improving productivity. 2) Staff and customer interpersonal drama. 3) Back office/desk re-organizing and paperwork filing. 4) Excessive email and digital dependence. 5) Things outside my control, like politics, weather, etc. When we demand more from ourselves, we can be surprised as to the returns we will achieve. Our nation has always been a “land of opportunity;” let’s all learn to take advantage

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of that truth and become better at using the tools available to us to grow and achieve the goals we set for ourselves. Remaining cognizant of the beauty of my daily commute requires a focus and appreciation of the gift I have of such interesting views; the same way I have to appreciate the variety of challenges I choose to face daily at my store. The journey is not easy, and the rewards are personal and have uniqueness that give my life flavor. My advice to all who have made it this far is to learn the skill of driving your store and your life to the destination of your choice. For some that may be the freedom of time, for others that maybe the freedom of increasing your income. For me it is a choice to see the beauty of the world as I commute to work daily, with this renewed appreciation that makes me happy to arrive at my store … and stay on hold for 35 minutes with the 7-Eleven helpdesk for the fifth time this month. ARFAN “ART” FAROOQI

CAN BE REACHED AT 813-786-1895 or



Labor shortages, competitive wages, and employee expectations are disrupting the c-store world. These challenges have created a lack of qualified and motivated people and could be resulting in excessive work hours for existing staff and questionable hiring decisions. The short-term solution is to hire almost anyone willing to work. Without proper diligence in the interviewing and training process, this short-term solution could result in high costs and problems for your safety culture. The long-term solution is to remain selective and hire and train the best person you can. Until self-checkout becomes more viable or relevant, you remain in a people business, with your employees presenting the face of your brand. Why Train? Employee turnover and inadequate training directly affect your bottom line and can be a struggle for c-stores. Effective management of your people with quality training leads to a more successful employee that is safer, more likely to stay, and is more comfortable with customers, resulting in improved sales, and lower costs. Training is one of the most important tools in helping an employee succeed and promotes incident and injury prevention. The objective of safety training is to help your employees make safe decisions in the store. For example, “Should I lift two cases

“ OSHA has safety training requirements enforceable by law and without compliance, can levy fines to ensure employees are aware of the hazards they may face.”

of water at once because it’s faster?” or “Someone steals a 12-pack of beer and runs out the door—should I follow them to get the license plate or confront them?” This type of decision-making is common for your employees and through quality training and empathy for your staff, a safe outcome will occur more often. Something else to consider is that you want your employees to make good decisions in your absence. Quality training will influence this behavior. There are legal requirements for safety training, too. OSHA has safety training requirements enforceable by law and without compliance, can levy fines to ensure employees are aware of the hazards they may face. Common OSHA required topics include: • Hazard Communication—Safe use of chemicals and how to use a Safety Data Sheet. • Fire and Evacuation—Your employee must know what to do in a fire or other emergency. • Walking and Working Surfaces—Show employees how to identify and correct slip, trip, and fall hazards (ladders and step stools should be covered, too). • Medical and First Aid—What to do when first aid or medical care is needed, and use of the first aid kit. • General Duty Clause—Information to help employees understand what is needed to “keep the workplace free of recognizable hazards.” This includes utility knives, lifting, and crime/assault prevention.

“ Effective management of your people with quality training leads to a more successful employee that is safer, more likely to stay, and is more comfortable with customers.”

When Should Training Be Done? New employees should be trained their first day following any SEI guidelines for the Computer Based Training (CBT) orienta-

tion. Although an employee may have prior retail experience, your brand may be different and they must understand your operation and expectations for safety. Refresher training is also important, as an employee cannot recall everything covered those first few days. Reminder training also should be completed after a near miss, incident, or injury. If an employee cuts their hand opening a case of hot dogs, it’s time for a reminder for all the employees. If an employee is threatened by a shoplifter or assailant, there should be a reminder to the staff on procedures regardless if an injury occurs. The outcome of an incident or near-injury should not dictate the need for refresher training. Who Should Do The Training? The CBT program provides most of the necessary safety training orientation for a new hire, but watching and interacting with a computer program provides information that is only partially retained. It’s critical that you or the manager actively engage the employee before and after the CBT. As Management, you are in the best position to know the employee’s comprehension and further understand their strengths and weaknesses, and to verbalize your safety expectations. How To Make Training Effective Training involves many methods with CBT now prevalent. Considering that people continued on page 38

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have different learning styles, this method alone with interactive quizzes might result in 20 percent recall or retention. This is not adequate for important safety and customer service learning. Effective learning requires a simple method: Tell, Show, Do, Practice, and Review. This means certain steps must be in place to assure your employee effectively retains the key information after the initial orientation. And it’s important to recognize that not all employees will learn the same way. A younger employee will likely respond to CBT supplemented with interaction, quizzes, games, etc., in short segments. An older employee may need more verbal interaction and all employees need real-life examples. Consider that Millennials (born between 1980-1995) may not be the most current applicant but they will progressively become the dominant demographic. This group tends to be less loyal and has high expectations for a balanced work-life. This group, in particular, will frequently give a “bad boss” as a reason for leaving, and by definition, a bad boss can be: leadership lacking empathy, concern, and absence of active listening. These factors impact your safety results. Steps To Training Success 1. Combine verbal with online training. 2. Explain and then demonstrate the job procedures. 3. Have the employee demonstrate they understand. 4. Praise for what is done correctly. 5. Correct the technique if necessary. 6. Follow-up and repeat if needed. 7. Encourage the employee to share their expertise. A training example—how to restock a bag in a box (BIB): • Describe how to prepare for lifting by checking for a clear path. • How to disconnect the empty BIB and place it in a safe place for disposal. • Explain why 5g. boxes should be placed 38

“ Effective learning requires a simple method: Tell, Show, Do, Practice, and Review.” between the shoulders/ knees. • Show how to bend the knees and use proper lifting technique. • When to ask for help. This may seem time-consuming and complicating a simple job, but one cannot assume an employee will understand how to safely handle a basic task that can result in a serious back injury. Summary New employees will bring their habits or traits with them, and these cannot be changed by simply watching a computer program or seeing a poster. With a tell, show, do, practice, and review approach, behaviors and techniques can be altered with follow-up and reinforcement. Consider that non-verbal learning also occurs. If an employee observes another employee or manager correctly lifting a BIB or a single case of drinks instead of two at once, the desired behavior will occur more often. Quality, empathetic, and ongoing safety training can also improve employee retention that results in lower costs and reduced chances of injury. Training provides the necessary information, but embedding the material into daily activities, whether it’s responding to an assault or stocking drinks in the vault, requires a steady stream of feedback and reminders, verbal and non-verbal. And consider, in addition to owner, CEO, Human Resources Manager, and more, you are the most important teacher. For free training resources, contact your insurance company or broker/agent.

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jharp@msigusa.com or 908-604-2951

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Foods stores in California and in Washington, D.C. will be the first to deploy Amazon’s Just Walk Out technology when they open next year, reported CNBC. Neither location will have staffed checkout lines, opting instead for self-checkout kiosks to complement the Just Walk Out lanes, while offering traditional checkout with employees only at the customer service desk. • Walmart plans to hire about 150,000 new U.S. store workers, most of them permanent and full-time, in preparation for the busy holiday season, reported Reuters. The retailer also plans to offer extra hours to many of its store workers during the period, after rival Target also said it would provide more work hours for its retail employees amid a labor shortage in the country. • Since the beginning of 2020, Target has gained more than $2 billion in U.S. grocery market share and more than doubled the rapid growth of its peers in the space, a momentum that resulted from a series of key investments such as the expansion of its omnichannel capabilities, the launch of new private brands and revamping the look of its grocery departments, reported Winsight Grocery Business. • A $9 million settlement has been reached in a Wawa data breach class action lawsuit, resolving claims surrounding a 2019 security incident that may have compromised consumers’ payment card information, reported TopClassAction.com. Also as part of the settlement, the company has agreed to make certain security changes and enhancements worth approximately $35 million. • A shortage of small plastic bottles has forced c-store chain Kwik Trip to curtail production of some flavored milk and cappuccino creamer for its 780 stores, reported the Milwaukee Journal Sentinel. The La Crosse, Wisconsin-based company, which ships roughly 105,000 gallons of milk a day, has its own dairy processing plants and is one of the largest milk producers in the Upper Midwest. • Remote ordering and off-site dining now represent the bulk of the restaurant industry’s orders, with 67 percent of average restaurant sales generated by orders placed digitally or by phone for off-premises dining, according to the “Restaurant Readiness Index,” a PYMNTS and Paytronix collaboration. • People in twenty-four states—including California, Florida and Louisiana—most frequently purcontinued from page 42

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of their existing franchised stores. chisees are unhappy. The company is making money selling gasoline, but franchisees are Question No. 8 in the survey asked franchitelling us they are not making a reasonable profit because sees whether they agreed with this statement: “My job as of the nature of our contract.” a franchisee is simpler than it was 5 years ago.” Almost 88 percent of respondents disagreed with this statement. The We issued a press release detailing some areas of particular concern to you, highlighting such points as: National Coalition survey also asked franchisees to rank the most important issues facing their business. Tops were a • Sixty-eight percent of the franchisees who responded nationwide staffing shortage, cost of goods/shrinking gross to the survey indicated they signed the 2019 Franchise profit margin, franchisee net income and 24-hour operations. Agreement, yet only 17 percent said they are in a better Again, the 1990 LA Times article echoed similar confinancial position now than they were under the previous cerns. A few key statements from the article: contract. • “Many franchisees go years without a • More than 90 percent of franchisees said they “Sixty-eight pervacation, unable to afford the salary of a would not enter the system again. cent of the franchisees manager who could take over for them.” • Another 90 percent said your job is more who responded to the survey • “Those who stay in business have limdifficult today than it was five years ago. indicated they signed the 2019 ited leeway in running their businesses.” We also asked franchisees if they agree Franchise Agreement, yet only 17 • “Many say they are working 60 hours with the statement, “The effect of runpercent said they are in a better a week or more and cutting their staffs ning my 7-Eleven business has negatively financial position now than because of tougher business condiimpacted my physical health, mental health, they were under the previtions.” and/or family well-being.” ous contract.” • “[the brand’s] accounting and bookkeep An overwhelming 80 percent of you ing system is error-prone.” agreed with that statement. We want SEI’s executives to understand the personal harm many of you The LA Times interviewed a Sacramento-area are feeling from being a franchisee, as well as the fact that 83 franchisee named Ross Pacini, who was president of the percent of you disagreed with the statement: “Headquarters Northern California 7-Eleven Owners Association and had in Dallas responds appropriately to the needs of 7-Eleven been in the system since the 1970s. His comments still ring franchisees.” true: “You work your butt off, and you risk a lot…You make your money one penny at a time.” The lack of trust between franchisees and SEI is a startling concern for all of us: In response, Jorgensen said, “We are struggling to keep our heads above water in the current environment. Every • Only 10 percent agreed with the statement, “7-Eleven day there it seems there is a new challenge, but if that 1990 trusts its franchisees.” article tells us anything, it is that history repeats itself.” • Only 25 percent said, “I trust 7-Eleven.” • Only 5 percent said, “I trust the accuracy of 7-Eleven’s retail accounting system.” When asked if you think 7-Eleven “ WHEN ASKED IF IT executives are honest and ethical, 74 per 7-Eleven franchisees have been facing unprecedented WERE POSSIBLE TO cent of you disagreed. For comparison, challenges during the last 18 months—not only because of when we asked you that same question in the pandemic, but also because the onerous terms of the SELL YOUR STORE 2018, 64 percent disagreed. That indicates 2019 Franchise Agreement have been felt by so many in AND SALVAGE YOUR the lack of trust has grown in three years. that time. So, it comes as little surprise that the results of INITIAL INVESTour most recent survey indicate how many franchisees are “Trust is a real issue in part because MENT, 70 PERCENT unhappy and feeling harm to their personal well-being. The SEI accepts money from its vendor survey tallied results from 598 National Coalition members partners while telling us we won’t reOF YOU INDICATED representing 1,118 stores across the country. ceive the lowest cost of goods from the YOU WOULD SELL.” supply chain they control,” said NCASEF “The results of this survey are alarming,” said NCASEF continued on page 42 Chairman Jay Singh. “The overall sentiment is that fran-

Latest Franchisee Survey Finds Major Concerns In All Areas Of Our Businesses

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since last year, according to the 12th annual LexisNexis Risk Solutions True Cost of Fraud Study. The report reveals that every $1 of fraud costs U.S. retail and e-commerce merchants $3.60 compared to $3.13 prior to the pandemic. This is a 15 percent increase from a pre-pandemic survey and a 7.1 percent increase since the 2020 survey conducted during the pandemic. The cost of fraud in Canada is up 5.2 percent since 2020, now at $3.02. The mobile channel plays a key role in this increase in both countries, as more consumers turned to their devices to shop during the pandemic. Other key findings from the report include: • Fraud Volumes Soar: The overall volume of fraud attacks has grown beyond pre- and early pandemic periods, with businesses offering online/mobile transactions experiencing the largest year-overyear increase. U.S. ecommerce merchants have been hit particularly hard with merchants reporting a 140 percent increase in attacks since 2020 and their counterparts in Canada reporting a 52 percent increase. Successful attacks rose 52 percent and 45 percent in those markets respectively. • Struggles with Identity Verification: Identity verification remains a top challenge for merchants and represents a larger share of fraud losses compared to previous years. A recent LexisNexis Cy-

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bercrime Report revealed that synthetic identities and other account-related fraud frequently match to breached digital identity data such as email addresses and phone numbers. Merchants struggle to verify digital identity data and balance fraud detection with an exceptional customer experience.

Walgreens To Raise Wages To $15 Drugstore chain Walgreens Boots Alliance will raise its wages for hourly workers in phases, with the goal of reaching $15 per hour by November 2022, reported CNBC. Initial pay hikes began in October. Its previous starting wage was $10 per hour, but the company said around half of its 190,000 hourly workers earn at least $15 an hour. The move comes as retailers compete for workers in a tight labor market. Walgreens said it will cost $450 million over the next three years to increase its pay. About a third of those costs will be incurred in fiscal 2022. The drugstore chain said it expects it will be able to offset the impact of the investment in the normal course of its business. The company has added 25,000 full-time and part-time workers during the course of the pandemic. continued from page 41

Executive Vice Chairman Michael Jorgensen, a Tampa-area franchisee. “When we raised this issue with FTC Commissioner Rohit Chopra at our recent convention, he said the commission was aware of the practice.” Since 2006, SEI has spent $28.3 billion in 39 separate acquisitions, yet only 40 percent of you said your store has received a physical plant upgrade totaling more than $10,000 in that same time frame. When asked if it were possible to sell your store and salvage your initial investment, 70 percent of you indicated you would sell. At the same time, 80 percent of you said the equity in your store and its value are lower today than they were two years ago. The National Coalition is sharing the results of our 2021 survey with the FTC to support Chopra’s efforts to “safeguard operators of franchised businesses from abusive practices by franchisors.”

chase gasoline between 5-6 p.m., according to a new study by GasBuddy. Another 23 states—like Alabama, Arizona and Oregon—purchased fuel most frequently between 4-5 p.m. Across the U.S., Friday is the most popular day to fill up, with 15.9 percent of weekly sales. • Coca-Cola recently announced a partnership with shared electric vehicles provider Lime to reward people who are committed to recycling. To celebrate the nationwide availability of Coca-Cola Sip Sized bottles made from 100 percent recycled plastic material (rPET), the companies are offering more than 40,000 free bike or e-scooter rides to people who purchase and pledge to recycle their 13.2oz, 100 percent rPET Coca-Cola bottles. • Retailers are seeing the benefits of paying for college, reported CNBC. Companies like Walmart, Amazon, Chipotle, Target and Starbucks have recognized that offering subsidized higher education to employees helps drive recruitment, increase retention and foster a loyal workforce. • Target recently announced that it will pay an extra $2 an hour to employees who work peak days during the holiday season, such as on Saturdays and Sundays in the final weeks before Christmas. • Supermarket chain Kroger recently held a nationwide employment event with the goal of hiring 20,000 seasonal workers for retail, e-commerce, manufacturing, supply chain, merchandising, logistics, corporate, and pharmacy and healthcare positions. • Walgreens will close five more San Francisco stores because of ongoing organized retail crime, reported SFGate.com. The company said retail theft across its San Francisco stores has continued to increase in the past few months to five times its chain average. Walgreens has closed at least 10 stores in the city since the beginning of 2019. • The cannabis edibles market is expected to surpass $10 billion in annual sales by 2025, according to market research firm Brightfield Group. This is one of the fastest-growing product types, consistently capturing the third-largest share-of-shelf of all cannabis product types. • An unmanned 24-hour convenience store recently opened in Toronto, reported the Daily Hive. To gain access to the Aisle 24 store, customers must download an app and register for an account. Then they can shop for what they need and use the self-serve check out continued on page 45


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Legislative Update Florida Raises Minimum Wage

Minimum wage workers across Florida received a pay hike on September 30, when the state raised its minimum wage from $8.65 per hour to $10 per hour, reported ClickOrlando.com. The pay increase comes nearly a year after 61 percent of Florida voters passed Amendment 2 in the November 2020 general election. Amendment 2 pro“ FLORIDA RAISED vided for the state minimum wage to rise over the next several years until it ITS STATE eventually reaches $15 per hour, which MINIMUM WAGE was a change to Section 24 of Article FROM $8.65 PER X in the Florida Constitution. The pay HOUR TO $10 PER increase schedule is as follows: $11 on September 30, 2022; $12 on September HOUR ON SEP30, 2023; $13 on September 30, 2024; TEMBER 30.” $14 on September 30, 2025; and $15 on September 30, 2026.

ly increase the federal excise tax (FET) on tobacco and nicotine products, reported NACS Online. This language is from a bill that was introduced earlier in this Congress—the Tobacco Tax Equity Act. As written, the legislation doubles the federal excise tax on cigarettes and applies tax parity to all other tobacco products. NACS said it opposes an increase of this magnitude because it will push current users to the illicit market where products are unregulated, and age isn’t verified, which undermines the responsible efforts of convenience retailers. Additionally, within the reconciliation package, NACS said it is concerned about the cumulative effect that the various tax increases will have on the convenience industry. Given that most convenience stores operate as pass-through entities, the proposed increase in the top individual rates constitutes a significant tax increase on small businesses. NACS said it led a letter to House leadership and members of the Ways & Means Committee opposing the increase in the FET for these reasons.

NY Increases Minimum Wage For Upstate Workers

Tough Plastic Bag Ban Introduced In Berkeley, CA

Upstate New York minimum wage workers will see an income boost starting January 1, reported the Times Union. The state Department of Labor recently announced that the minimum wage north of Westchester will rise to $13.20 an hour, up 70 cents from $12.50 an hour. The state will also push the minimum wage for workers in Westchester and Long Island from $14 an hour to $15 an hour as part of a scheduled increase. The state mandated a gradual phase-in of a $15 minimum wage as part of a state budget plan in 2016. The state Department of Labor is required to update the minimum wage each year until every worker makes at least $15 an hour. The increase is happening after a report (which is required by statute) that was done by the state’s Division of the Budget found evidence of pressure for wages to rise in the midst of a pandemic-driven labor shortage. The State Labor commissioner said many companies that employ low-wage workers are already raising their wages or offering incentives in an effort to find enough workers.

NACS Opposes Federal Tobacco Tax Increase

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A Berkeley, California council member wants to dramatically expand local restrictions on plastic bags, with a new proposed ordinance that would almost entirely banish the containers from stores and restaurants, reported Berkeleyside.org. The legislation would outlaw the thick, reusable plastic grocery and takeout bags that many businesses have switched to using since Alameda County’s ban on flimsier single-use bags took effect in 2013, and it would broadly prohibit stores from providing the plastic “pre-checkout” bags typically used for produce or bulk items. While the ordinance would allow the use of paper bags instead of plastic ones, it also requires that by 2023 all paper bags be made entirely from recycled materials. The measure would apply to grocery stores, convenience stores, restaurants, food trucks and vendors at permitted events such as farmers markets; customers would have to pay 10 cents apiece for paper bags if they don’t bring their own. The proposal is in the early stages of what is likely to be a months-long legislative process, the article states.

Federal Excise Tax Increase Would Harm Economy, Says NATO

The large federal excise tax increases on tobacco proposed in the Congressional reconciliation budget bill would have a significant negative economic impact not only on retail stores, distribcontinued on next page

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to pay for their items • As curbside pickup matures, grocery stores are set to experiment with adding drive-thru lanes to speed up the process, reported Modern Retail. Amazon is adding a drive-thru lane to one of its under-construction Amazon Fresh locations in Florida., and grocery chain Hy-Vee announced its intention to open drive-thru lanes previously reserved for pharmaceuticals to grocery orders. • El Pollo Loco recently became the first quick-service restaurant to test drone delivery in the U.S., reported the Franchise Times. The “LA Mex” brand tested the capabilities in 10 Southern California locations. It partnered with drone operator Flytrex, which also helped 7-Eleven with its own drone test. • DoorDash announced it is now offering beer, wine, and spirits delivery via the DoorDash Marketplace, across 20 states and the District of Columbia, as well as in Canada and Australia, reaching over 100 million customers worldwide. • The governors of Illinois, Indiana, Michigan, Minnesota and Wisconsin are joining forces to build a new network for charging electric vehicles, reported NPR. The bipartisan plan, called REV Midwest—the Regional Electric Vehicle Midwest Coalition—promises to make it easier to find charging stations, which could boost adoption of electric vehicles if it eases drivers’ concerns about the range of their batteries. • Casey’s General Stores recently announced an agreement to acquire 40 Pilot convenience stores from Pilot Corporation in an all-cash transaction for $220 million. The 40 Pilot stores will extend Casey’s presence in Tennessee and Kentucky with well-established locations primarily in the Knoxville, Tennessee market. • Sam’s Club increased its minimum hourly wage to $15 from $11 on September 25, a move that comes as the Walmartowned warehouse club competes with other retailers and restaurants for workers in a tight labor market, reported CNBC. • The FDA is asking food manufacturers and restaurants to cut the salt in their products over the coming two and half years, hoping to reduce Americans’ overall sodium intake by 12 percent, reported NBC News. The sweeping recommendation is expected to cover a wide variety of foods—from chain restaurant meals to processed food on grocery store shelves. • continued on page 46

Legislative Update utors, and their employees, but also on states, cities and the local communities, the National Association of Tobacco Outlets (NATO) revealed in a new report. These impacts would occur because the legislation would double the federal cigarette tax, a 100 percent increase from $1.01 per pack to $2.02 per pack, while increasing the tax rates on other tobacco products by up to 2,000 percent. Such drastic increases in federal excise tax rates will reduce sales, lead to employee terminations, cause lost wage income, decrease state and local excise and sales tax collections, and reduce annual Master Settlement Agreement payments to all U.S. states and territories (including the four separately settling states), NATO said. According to market data, cigarette and other tobacco product sales account for more than one-third of in-store sales at the nation’s convenience stores and upwards of 90 percent of sales at tobacco outlet stores. In addition, some “ THE LARGE FEDERAL EXCISE TAX IN3.8 million employees nationwide CREASES ON TOBACCO PROPOSED IN THE work at stores that sell tobacco products. State and local excise CONGRESSIONAL RECONCILIATION BUDGET taxes and sales taxes collected on BILL WOULD HAVE A SIGNIFICANT NEGATIVE these products are also critical ECONOMIC IMPACT, ACCORDING TO NATO.” revenue sources to state and localities across the nation.

Virginia County Board Passes Plastic Shopping Bag Tax

The Fairfax County Board of Supervisors in Virginia recently voted to approve a 5-cent tax on plastic bags at grocery stores, convenience stores and drugstores, reported Inside Nova. The tax will go into effect January 1, 2022. The Virginia General Assembly approved legislation in 2020 allowing localities to impose a 5-cent tax on disposable plastic bags, with some exceptions. The state code requires retailers to collect the tax proceeds in a similar manner to sales and meals taxes. Through December 31, 2022, retailers can keep 2 cents from the tax collected on each bag, with the retailers’ share dropping to 1 cent starting January 1, 2023. The Virginia Department of Taxation created a fiscal impact statement with the legislation that said the tax could generate between $20.8 million and $24.9 million in revenue statewide based on similar taxes in Montgomery County, Md., and Washington, D.C.

Styrofoam Ban Proposed In Florida

Styrofoam may be on its way out of Florida stores, reported WTLV First Coast News. The state’s agricultural commissioner recently announced that a rule to ditch polystyrene in the sunshine state is in the works. The ordinance, which is still in the draft form, stipulates that Florida grocery stores, markets, and convenience stores would not be able to sell or distribute food in containers made of polystyrene, such as styrofoam. The new rule, to be phased in over five years, would not apply to restaurants because they do not fall under the agriculture commissioner’s purview. continued on page 46 S E P T E M B E R | O C T O B E R 2 0 2 1 AVANTI


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Legislative Update Washington’s Single-Use Plastic Bag Ban Kicks In

Washington state’s ban on single-use plastic bags went into effect on September 30, reported The “ WASHINGTON’S NEW Seattle Times. Under the new rules certain carryout STATE PLASTIC BAG bags will be permitted, such as large paper bags and BAN OVERRIDES thick reusable plastic bags, but will cost customers LOCAL LAWS TO an 8-cent fee per bag. The bags must be made with CREATE CONSISTENT a certain amount f recycled content, and green or brown compostable bags are also allowed for use. POLICY AND FEES.” The Washington Legislature passed the statewide ban during the 2020 legislative session, but its implementation was delayed due to the pandemic. Local bans are already in place in cities in Washington, including Seattle, Olympia, Tacoma and Edmonds. However, the new state requirements will override local laws, to create consistent policy and fees across the state. All retail, grocery and convenience stores as well as restaurants, temporary stores or events where food or goods are sold are banned from using single-use plastic bags. There are exceptions for consumer bulk items, produce, frozen food, meat, flowers and potted plants, prepared food or bakery items and prescription drugs. The Department of Ecology said it has a reporting form that any person can submit to report a business. The department said it intends to seek voluntary compliance, though businesses that repeatedly violate the rule may face a $250 fine.

Get On The Avanti Mailing List! Are you a franchisee and would like to receive your own copy of Avanti—The Voice of 7-Eleven Franchisees? You can get on our mailing list by sending a request to avantimag@ncasef.com with your name

and store address, and we’ll be sure

to include you in future mailings.

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The U.S. Postal Service is planning to hire 100,000 employees in 2021, looking to fill vacancies that have contributed to logjams in the mailing agency’s network and widespread delivery delays, reported Government Executive. The hiring campaign started in January of 2021 and will continue into January of 2022. • Ford Motor and its autonomous driving affiliate, Argo AI, have teamed up with Walmart to begin testing the home delivery of groceries and other items by self-driving cars in three cities this year, reported the New York Times. The service will start in Miami, Washington and Austin, Texas, and will be limited to specific areas but is intended to expand over time. • PepsiCo plans to release new plant-based snacks and drinks made through its joint venture with Beyond Meat by early 2022, reported CNBC. Pepsi and Beyond announced the joint venture, called The PLANeT Partnership, in January. The partnership gives Beyond a chance to leverage Pepsi’s production and marketing expertise for new products, and Pepsi can deepen its investment in plant-based categories. • Supermarket chain Hy-Vee recently announced that it has partnered with Simbe Robotics to roll out its inventory management robot, Tally, to stores across Iowa, Nebraska and Missouri. Tally autonomously scans tens of thousands of products to ensure products are in stock and in the correct location, and can reduce outof-stocks by up to 30 percent. • Kroger Co. has joined with Instacart Inc. to deliver food and household staples in as little as 30 minutes, bringing the supermarket giant further into a crowded grocery-delivery business, reported the Wall Street Journal. Kroger tested accelerated delivery two years ago but realized such a service was difficult to maintain and expand using only Kroger employees. • Plans are underway for Michigan to construct a first in the nation segment of road that will charge electric vehicles while they’re driving, reported the Associated Press. The one mile stretch of state roadway will allow public transportation and private vehicles to charge while traveling as a part of the Inductive Vehicle Charging Pilot. • Walmart is testing a new service called Walmart Text to Shop that allows customers to voice-text their shopping lists directly to the retailer, reported Winsight Grocery Business. Walmart continued on page 50


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of opening stores and paying franchisee The first 7-Eleven store in India fees. In 2019, Future Retail—India’s secopened on October 9 in Mumbai, India’s ond-largest retailer with more than 1,700 largest city and the country’s economic stores—said it would set up 7-Eleven stores powerhouse, SEI announced in a press refrom scratch and convert some of its existlease. Opened by 7-India Convenience Reing operations into the U.S. brand. The unit tail Limited, a wholly owned subsidiary of formed to run the 7-Eleven stores in India Reliance Retail Ventures Limited (RRVL), had reported a loss of 173 million rupees this store offers residents and tourists without opening any stores, Future Retail’s 7-Eleven’s unique style of convenience, sigannual report showed. nature food and drinks, as well as products and delicacies especially created to appeal BRINGING THE HEAT WITH to the local market. A number of 7-Eleven THE ONE SLICE CHALLENGE stores are anticipated to open later this year In October 7-Eleven dared all fans of in the Greater Mumbai cluster. pizza, spicy food and social me The store is located on the dia to participate in its One first floor of the Atul Blue For“A number of Slice Challenge: eat one slice tuna apartments on Military 7-Eleven stores are of any 7‑Eleven pizza, top it Road in the vibrant Marol anticipated to open later with 7‑Eleven’s proprietary neighborhood of the Andthis year in Mumbai, 11-Pepper Sauce, a 2 oz heri East suburb in Mumbag of Paqui Haunted Ghost India.” bai. Andheri is home to the Pepper chips and wash it down city’s international airport, with a can of Liquid Death Mounmultiple rail stations and India’s Bollywood entertainment hub. SEI said the tain Water. Customers were able to get 7–Eleven brand’s entry into the country will their hands on everything they needed to modernize the small-retail environment and try the One Slice Challenge at participating bring greater convenience to shoppers. The 7‑Eleven stores for just $3 with 7Rewards. two-story 1,700-square-foot Mumbai store To make it extra spicy 7‑Eleven asked fans to post their reactions to the challenge (aka will have a café. SEI said it recently terminated a mas- eating, drinking and sweating) on social ter franchise agreement with a subsidiary media in true “pics or it didn’t happen” of Future Retail Ltd, and on October 7 announced it had signed a master franchise agreement with Reliance Retail Ventures Ltd. to support the company’s first entry into India. According to a Reuters report, Future Retail said it had mutually terminated an agreement with 7-Eleven as the companies were not able to meet targets

fashion. The reward for finishing what could be the hottest slice of pizza on planet earth was a chance to be featured on 7‑Eleven social channels.

NEW CONCEPT STORE UNVEILED IN FLORIDA The Chaudhary Petroleum Group (CPG), a 7-Eleven Portfolio Partner, recently announced the opening of a new concept 7-Eleven franchise store in Westlake, Florida, the city’s first new retail development since incorporating in 2016. Customers were allowed in for the first time on Friday, September 3 while the new owners, along with a team from 7-Eleven’s corporate office and representatives from the city held a grand opening event and ribbon-cutting ceremony to mark the new beginning. The convenience store/gas station/car wash was developed by Chaudhary Petroleum Group in cooperation with 7-Eleven as a new concept in Florida. Those unique features include a restaurant, Wine Cellar, nitro cold-brew and iced tea bar, among others. The store was designed with a classy wood-grain texture on the exterior, bright, colorful light designs on the ceiling and high-definition video screens in high-traffic areas. The most unique part of the new store is the Fusion Fresh restaurant, which offers a made-to-order menu served throughout the day. Breakfast items include hot oatmeal bowls with fresh fruit, and breakfast sandwiches, quesadillas and burritos made with real eggs, bacon and sausage. Lunch and dinner items include fresh chicken dishes, hamburgers and continued on page 48

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sandwiches. Patrons can order directly from a digital pad at the counter and have the option of eating outside on a landscaped patio or taking their food to go.

7-ELEVEN OPEN FOR BUSINESS IN CAMBODIA Cambodia’s first 7-Eleven store opened on August 30, in Phnom Penh, the bustling capital city of the Southeast Asian country, SEI announced. CP ALL Cambodia Co., Ltd. holds a master franchise agreement with 7-Eleven, Inc. and is solely authorized to develop and operate stores in Cambodia. CP ALL Cambodia Co., Ltd. is a subsidiary of CP All Public Company Limited, which operates more than 12,000 7-Eleven stores in Thailand and is the largest 7-Eleven licensee. Open 24 hours a day, seven days a week, the new store carries over 2,000 products, ones typically found at 7-Eleven stores such as Slurpee semi-frozen drinks, award-winning value-priced 7–Select private brand snacks, and local fresh food items, including some unique to the Cambodian market.

7-ELEVEN EXPANDS INTO ISRAEL SEI recently announced that it has signed a master franchise agreement with Electra Consumer Products Ltd. to develop and operate 7–Eleven stores in Israel. Electra is a subsidiary of ELCO LTD., a leading Israeli company with a multi-faceted portfolio of business interests. The first 7–Eleven convenience stores in Israel are expected to open in 2022. SEI said it will support Electra Consumer Products to implement and localize the brand’s unique retail business model. The expansion marks the 7‑Eleven brand’s first


entry into Israel and will be the 19th country in which 7‑Eleven stores will operate. Other countries and regions with a 7‑Eleven presence include the United States, Canada, Mexico, Japan, India, Thailand, South Korea, Taiwan, China, the Philippines, Singapore, Malaysia, Viet Nam, Cambodia, Australia, Norway, Sweden and Denmark.

video, bandmates Morgan, Brooke, and Fiona rock signature black leather jackets with a cheesy style twist. As an ode to the song’s original Instagram video, the video was shot at their hometown Doylestown 7‑Eleven store, with local customers and the band’s personal friends and family appearing as extras. The video also celebrates the return of 7‑Eleven’s new and improved nacho cheese, which brings back the traditional style and classic taste by popular demand, the company said in a press release.

PROJECT A-GAME DONATES HIGH SCHOOL GIRL BAND SINGS THE PRAISES OF TO POLICE YOUTH 7‑ELEVEN’S SPORTS OUTREACH NACHOS PROGRAM “Project A-Game Froggy, the teen The Colorado Springs age riot grrrl punk Police Department redonated a $711 grant to rock band out of the Colorado Springs Police cently brought out their Doylestown, PennsylSWAT van to distribute Department’s PLAY vania, recently caught sports balls to local youth COS program.” the attention of 7‑Elevas part of 7-Eleven’s Project en with the release of their song and smartphone-shot music video, “7‑Eleven Nachos,” in January of this year. To applaud Froggy’s creativity and honor their extreme love of nachos, 7‑Eleven and Froggy worked together to produce a professional music video of the song—all on SEI’s dime. The “7‑Eleven Nachos” video officially dropped across 7‑Eleven’s Instagram, YouTube, Twitter, Facebook, and TikTok channels in mid-September. In the music

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A-Game, reported KRDO. com. Project A-Game donated a $711 grant to the Colorado Springs Police Department’s PLAY COS program, which supplies officers with sports equipment to give out to kids and teens during their shifts. Through this initiative, the police department wants kids to know officers are focusing on protecting them and the community, the article states. Within the last few months, PLAY COS gave away more than 550 sports balls to kids across Colorado Springs.

LAREDO TACO COMPANY LAUNCHES VIDEO SERIES SEI’s Laredo Taco Company recently launched a new six-part video series “Made Right Here Road Trip,” with host continued on next page

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Mando Rayo from United Tacos of America on its website, and social media channels (Facebook, Instagram, Twitter, YouTube, and TikTok). To celebrate Hispanic Heritage Month, the new series trailer was released on September 30, and the first episode featuring the birthplace of Laredo Taco Company was released on October 5th, to celebrate National Taco Day. In the videos, Rayo takes viewers on a Texas-sized taco-tour, taste-testing his way through his personal Laredo Taco Company favorites in cities across the Lone Star State. Rayo teams up with local city advocates and personalities to discuss the Hispanic culture influences and heritage, including local businesses, food, music, and art, while showcasing the rich history between Texas and Mexico. Laredo Taco Company released a new episode every “Taco Tuesday” throughout the month of October and into November.

SEI LOOKS TO DRAFT SUPERFAN INFLUENCERS SEI recently announced that it is drafting three social media-savvy customers to join its squad of football superfans and show their followers—and the world—how 7‑Eleven helps fuel their fandom. Led by Dallas Cowboys quarterback Dak Prescott, pro football wide receiver JuJu Smith-Schuster, and sportscaster Erin Andrews (each with a social media fan base in the millions),

the 7‑Eleven Superfan Influencer Team will “Take It To Eleven” all season long as they cheer on their favorite teams. To be considered for the team, customers were instructed to head to Instagram, TikTok, or Twitter and share a creative, cool, or fun image or video (or several) that shows how 7‑Eleven takes game day to ELEVEN. Submissions closed October 15. After the team is selected, SEI said it will kick things off with an intensive two-day influencer training camp for superfans to learn how to build their own fan base and create social posts that score big in likes and follows. Once they’ve gone through training, the superfan squad will continue in their roles as 7‑Eleven Superfan influencers through 2022. Each superfan will also receive an $11,000 signing bonus and additional spending money to try the latest and greatest 7‑Eleven products. Separate from entering the social contest, SEI said customers who may not be expert content creators can still win a spot on the 7‑Eleven Superfan Influencer team through the Fuel Your Fandom Sweepstakes. Through the end of the year, customers can scan the 7‑Eleven app when they buy select items in-store or for delivery to earn entries into the contest.

SCARY GOOD HALLOWEEN PIZZA DEALS Participating 7-Eleven stores nationwide offered a special pizza promotion on October 30 and 31 to celebrate Halloween: • BOGO $1 Large Pizza—In-Store: 7Rewards loyalty members were invited to pick up any large hot or ready-to-bake pizza—from 7-Meat to Cheese to Pepperoni— and get a second large pizza for just $1.

• $3 Large Pizza via 7NOW Delivery— Customers could order their favorite large hot or ready-to-bake pizza through the 7NOW delivery app for $3 only. The 7-Meat Pizza is covered in sausage, beef crumbles, smoky bacon, and more, while the Cheese Pizza has 100 percent real mozzarella piled on top vine-ripened California tomatoes. The classic Pepperoni has all the same cheesy and gooey goodness, plus thick-cut pepperoni. Hungry trick-or-treaters also enjoyed a special Halloween donut drizzled with bright orange icing and garnished with spooky sprinkles.

KOREA SEVEN DEPLOYS AUTONOMOUS DELIVERY ROBOTS Korea Seven, the South Korean operator of 7-Eleven, has teamed up with Neubility, a domestic autonomous robot startup, to adopt and commercialize short-range delivery services using autonomous robots equipped with multiple cameras and sensors, reported Aju Business Daily. When commercialized, the robots could help store owners save operating costs. Korea Seven said it plans to commercialize the autonomous robot, called Neubie, in Seoul and its surrounding cities by the end of 2021. The robots continued on page 50

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operate using its cameras, which only cost one-tenth of a light detection and ranging (LiDAR) device. According to the article, Neubie robots can easily carry out delivery missions even in complex urban areas regardless of weather conditions. For instance, it is difficult for autonomous robots to operate in Seoul’s southern district of Gangnam filled with skyscrapers. Their GPS-based self-driving system may not work properly because satellite signals are blocked by the tall buildings. However, Neubie robots can navigate through these areas using cameras and sensors.

FOA Board Meetings FOA Of Chicagoland Please Note: All meetings will be virtual until further notice. Phone: 847-343-7777 December 9, 2021—Board Meeting

Southern California FOA Phone: 818-357-5985 November 24, 2021—Board of Directors & Members Meeting

Midwest FOA

South Texas FOA

Webinar Wednesdays Phone: 847-971-9457 November 3, 2021 November 17, 2021 December 1, 2021 December 15, 2021

Phone: 702-249-3301 November 10, 2021—Board & General Meeting December 8, 2021—Board Meeting

is also planning to launch Luminate, a system created with dunnhumby that will give the company’s suppliers access to real-time data to monitor the performance of products and promotions, while also letting them do customer surveys. • As Philadelphia’s ban on single-use plastic bags went into effect for all retailers on October 1, Wawa launched its Skip the Bag for Good Initiative and gave away 1,000 free reusable bags, with a purchase, in all of its 42 Philadelphia stores. • Target-owned delivery company Shipt has expanded its reach with retail partners, including Bed Bath & Beyond and CVS Health, adding service from almost 1,000 more stores and making delivery available to about 2 million more U.S. households, reported the Star Tribune. Atlanta, Los Angeles, Seattle and Charlotte, N.C., are among the markets seeing the most noticeable impact. • Walgreens is considering taking cigarettes off their shelves, reported 7 NEWS WSVN. The pharmacy chain said it is focusing on healthcare and might remove tobacco and tobacco-related products from its stores. The company has already cut back e-cigarettes and raised its tobacco buying age limit from 19 to 21 after coming under fire from the FDA. • Fast-food hamburger chain White Castle recently held a month-long program to thank its own team members who opted for the COVID-19 vaccine with a chance to win a $500 cash prize. The giveaway invited team members to submit proof of at least one COVID-19 vaccine to be automatically entered to win $500, one of 200 such cash payments awarded during the month of September. • Amazon has signed its first deal with a third-party customer for use of its biometric scanner, the Amazon One palm reader, reported Tech Crunch. Ticketing company AXS will implement the Amazon One system at Denver, Colorado’s Red Rocks Amphitheatre as an option for contactless entry for eventgoers. • Burger King recently started testing Impossible Foods’ meatless nuggets in several markets, making it the first fast-food chain to offer the company’s new chicken alternative, reported CNBC.

AD INDEX Anheuser-Busch.............................. 6 Aon Risk Management............... 30, 31 Blue Bunny/Wells.......................... 11 Cima Confections........................... 24 Coca-Cola................................cover 2 Danone............................................ 4 50

Diageo........................................... 15 Glanbia.................................... 32, 39 Hostess.......................................... 26 InComm......................................... 43 Kellogg’s.......................................... 9 King Palm...................................... 27

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Living Essentials............................ 25 Mars............................................... 51 McLane.......................................... 19 Miller Coors.................................... 22 Mondelez................................cover 3 Monster .......................................... 5

Swedish Match.............................. 20 Swisher...............................3, cover 4 Tell Industries................................ 40

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Making its return, the Bud Light Seltzer Ugly Sweater pack is back, but with fun new flavors and packaging. The Seltzer Category is growing, with a significant contribution coming from bold flavors. This 12 pack The Bud Light 12oz sleek variety pack features Seltzer Ugly Sweater pack is back with fun new Cranberry, Sugar Plum, Cherry flavors and packaging. Cordial and Seltzer Nog. Make sure to stock up on the perfect flavors for holiday parties or other winter themed occasions.

CASH IN ON HALLS THIS COUGH SEASON Fall weather is on its way and cough/cold season isn’t far behind. Stock your stores with the symptom-soothing power of Halls and secure a 40+ percent margin on every sale. Halls Minis put the soothing power of Halls in a convenient, pocket-sized pack. They’re soothing on your bottom line, as well. With 22 percent Category Incrementality (Nielsen QP: April 2019) and 57 percent Brand Incrementality (Nielsen BASES: April 2020), Minis can make a “small but mighty” impact on cough season sales, and can add real dollars to your registers. Stock your stores with Halls and secure a Cough shoppers 40+ percent margin on every sale. are value driven: 50 percent claim they buy larger bags to save money (Shopper Track Q1 2019 Cough Drop Buyers USA). That makes 30-count Halls Relief peg bags very attractive. Plus, research shows that the more cough drops you own, the faster you consume (Kantar Shipper Genetics 52 WE 02/29/2020), leading to 24 percent Expandable Consumption with 30-count bags. They’re also sold in recyclable packaging, 52

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perfect for environmentally conscious shoppers. Finally, at a solid 43 percent margin, they’re not just a great deal for your customers, they’re a great deal for your store. Stock up on Halls Minis for your on-the-go consumers and Halls 30-count bags for your bargain hunters, and take this cough and cold season to the bank.

ZYN IS AMERICA’S #1 NICOTINE POUCH ZYN Nicotine Pouches have not only revolutionized how people enjoy nicotine, but have ZYN Nicotine Pouches provide a changed the entire convenient, smoke-free experience. tobacco category. ZYN provides a convenient, smoke-free, spit-free nicotine pouch that consumers can enjoy for up to one hour—anywhere, anytime.

HOLIDAY FAVORITE INTERNATIONAL DELIGHT PEPPERMINT MOCHA CREAMER Warm up this Holiday season with the flavors of sweet peppermint and mocha. This winning flavor combination is always on the nice list. Whether you’re enjoying a nice hot classic Peppermint Mocha cup of coffee or mixing it up into a delightful Peppermint White Chocolate Frappe, the possibilities are endless. Did you know 33 percent of customers’ creamer preferences change depending Peppermint Mocha on the season/time of year? Peppermint is the #1 selling seasonal coffee Mocha is the #1 selling seasonal coffee creamer flavor in creamer flavor in December. Holiday December. continued on next page

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packaging recruits younger consumers to the creamer category with the Elf wraps generating excitement for Gen Z and Millennials. Give them the gift of Holiday cheer with deliciously bold Peppermint Mocha creamer. Available in both 32oz and 192ct PC. Peppermint Mocha 192ct/13ml cups are a great way to start the season for your consumers and to compliment your coffee bar selection. To place an order or learn more, please call (888) 620-9910 or visit DanoneAwayFromHome.com

HOSTESS INTRODUCES DEVIL’S FOOD HONEY BUN & BABY BUNDTS Hostess unveils two new items that will satisfy your customers’ cravings and boost your sales. New Hostess Devil’s Food Honey Bun is a winCustomers will run to your store for new Hostess ner among c-store males. Devil’s Food Honey Bun and Chocolate is their #1 most preBaby Bundts Lemon Drizzle ferred flavor of sweet snacks and and Strawberry Cheesecake. doesn’t exist in a Honey Bun form. Strong interest (114 Index) in a Devil’s Food Honey Bun vs. Total Adults. First Ship is November 1, 2021. Format: Single-Serve (18ct and 36ct cases). New Hostess Baby Bundts Lemon Drizzle and Strawberry Cheesecake are a sweet twist on the familiar, and there is now an opportunity to bring this celebratory treat to the everyday. Baby Bundt’s quantitative research surpassed BASES concept hurdles for success, with outstanding purchase intent. Baby Bundts Lemon Drizzle and Strawberry Cheesecake feature outstanding uniqueness, outstanding value, and 40 percent incremental to the category. First Ship is November 1, 2021. Format: Single-Serve (18ct and 36ct cases).

INCOMM ROLLS OUT VIRTUAL ME TELEHEALTH PROGRAM InComm Payments is pleased to introduce you to Virtual Me powered by Teladoc. Virtual Me is the first retail subscription telehealth program giving your customers and employees access to 7,000 Board Certified Physicians, 24 Hour Nurse Line, Email a Specialist, and a Discount Pharmacy Card—all for one affordable price. Virtual Me provides easy access to physicians Virtual Me is the first retail using mobile phones or computers subscription telehealth program that provides easy for video visits. Find program deaccess to 7,000 Board tails on the subscription gift cards Certified Physicians. rolling out in your store soon. Need healt care for your employees? Visit https://virtualme.care/ today to learn more about our programs and special offers.

MONSTER ENERGY UNVEILS NEW RESERVE LINE Monster Energy is bringing popular fruit forward flavors to extend the core family: Monster Energy Reserve Watermelon is the perfect nostalgic summer flavor that can now be enjoyed all year long. The big difference between Monster and the competition, is they do flavors right—your customers will get Your customers can now enjoy Monster Energy an authentic taste of watermelon Reserve Watermelon and White with Monster Energy. Pineapple all year round. Monster Energy Reserve White Pineapple is Monster’s take on the classic, tropical fruit flavor. White Pineapple has tons of different notes blended to give customers a truly unique and delicious flavor.

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Central Florida FOA 8th Annual Charity Golf Tournament Orange County National Golf Course Winter Garden, Florida November 5, 2021 Phone: 207-415-0924

Central Florida FOA 8th Annual Trade Show & Holiday Party DoubleTree by Hilton Orlando @ SeaWorld Orlando, Florida November 6, 2021 Phone: 207-415-0924

FOA Of Greater Los Angeles Holiday Party Diamond Bar Center Diamond Bar, California December 4, 2021 Phone: 619-726-9016

Midwest FOA Holiday Showcase Venue TBD December 8, 2021 Phone: 847-971-9457

San Diego FOA Christmas Party Hilton San Diego/Del Mar Del Mar, California December 11, 2021 Phone: 619-713-2411

South Texas FOA Annual Trade Show Canyon Springs Golf Course San Antonio, Texas March 30, 2022 Phone: 702-249-3301

National Coalition Board meetings are scheduled one per quarter. Vendors interested in sponsoring a Board meeting should contact John Riggio, JR Planners, at 262-394-5518 or johnr@jrplanners.com.

National Coalition Affiliate Meeting

South Texas FOA Annual Golf Tournament

Grand Hyatt Kauai Resort & Spa Koloa, Kauai, Hawaii November 15, 2021

San Francisco/ Monterey Bay FOA Holiday Party

Canyon Springs Golf Club San Antonio, Texas March 31, 2022 Phone: 702-249-3301

National Coalition Board of Directors Meeting

Venue TBD December 4, 2021 Phone: 510-791-2422

Suburban Washington FOA Trade Show

Grand Hyatt Kauai Resort & Spa Koloa, Kauai, Hawaii November 16-17, 2021

Southern California FOA Annual Charity Golf Tournament/ Holiday Party

Baltimore/WashDC/Suburban Washington Metro Points Hotel New Carrollton, Maryland April 21, 2022 Phone: 301-580-0305

Pacific Palm Resort City of Industry, California December 7, 2021 Phone: 818-357-5985


Delaware Valley FOA Trade Show Caesars Atlantic City Atlantic City, New Jersey June 23, 2022 Phone: 215-771-6178

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National Coalition Board of Directors Meeting Gaylord National Resort & Convention Center National Harbor, Maryland August 6-7, 2022

NCASEF 46th Annual Convention & Trade Show Gaylord National Resort & Convention Center National Harbor, Maryland August 7-10, 2022

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