7-Eleven Provides Details on Northern California Expansion

7-Eleven Provides Details on Northern California Expansion
January 04, 2010

7-Eleven Inc. plans to open another 50 new stores in Northern California by the end of 2011, adding to its 500 existing stores throughout the region. Nationally, the chain is opening 750 new stores in the next few years. "We're going into aggressive growth mode," Margaret Chabris, a spokeswoman for the Dallas-based, privately held company, told the Sacramento Bee last week. Saddled with little debt, 7-Eleven, which has 36,900 stores worldwide, will spend $50 million acquiring new Northern California stores and shell out more money to remodel 100 older stores on the West Coast, said Chabris in an interview with the Sacramento newspaper. There are 16 Sacramento area stores. Two more are already in the pipeline, with development of another six stores pending in the surrounding area, according to the Bee. A real estate source told the paper the new Sacramento area stores will begin opening in 2010, in both urban and suburban locations. With retail vacancies in the Sacramento region near 13 percent, 7-Eleven is taking advantage of deals being offered by landlords, such as free site improvements and free rent for as much as a full year.

The company grows by three methods: adding newly leased sites, taking over smaller convenience store chains or through its business conversion program, Chabris said. Through its conversion program, the company persuades existing businesses that might be struggling but are in ideal locations to convert to a 7-Eleven. At least 150 former delis, dry cleaners and other mom-and-pop businesses have done so since 2006, Chabris told the Bee. The company invests roughly $250,000 to transform the location and train the business owners, amounting to approximately one-fourth the cost of opening a new location, the report said. By adding more locations to an existing concentration of stores, the company is able to improve its ability to efficiently deliver fresh foods daily, Chabris added.
Source: Nielsen Business Media