Description
The PPT explaining about Seven Eleven Group of Japan.
7-Eleven Japan Group 5
Retail Market in Japan
• Second largest in the world, worth US $1,124 billion in 2008.
• More than 42,000 convenience stores found across Japan. Major players are 7-Eleven, Lawson and Family Mart.
• Apart from food and FMCG products, it offers a wide range of services including ATM‘s, ticket reservations, bill payments and delivery services. • Most convenience stores are open 24 hours a day and 7 days a week.
History
• Has its origins in 1927 in Dallas, Texas, USA founded by Joe C Thompson. • Initially, stores open from 7 a.m. till 11 p.m. and hence, the company started using the name from 1946 onwards. • First Japanese store opened in May, 1974. • In 1980, the company was rescued from financial difficulties by Ito-Yokado, its largest franchise which was founded by Masatoshi Ito in 1964. • Ito-Yokado gained controlling stake in 1991 and formed Seven & I Holdings. 7-Eleven became its subsidiary in 2005. • As of 2008, of the 34,200 stores around the globe, 12,013 of them are located in Japan. 1,577 are in Tokyo alone.
New Product Development
• After the collapse of the bubble economy, consumers started selecting products based on value and quality rather than merely the selling price. • Started selling rice balls and box lunches — Japan‘s equivalent of Western fast food. • Set up the Nihon Delica Foods Association (NDF) with the manufacturers of rice based products in 1979. • To eliminate differences in quality control between Association members, constructed plants exclusively for Seven-Eleven Japan.
Supply Chain Strategy-Key Drivers
• Logistical Drivers
– Facilities
– Inventory – Transportation
• Cross Functional Drivers
– Information – Sourcing – Pricing
Logistical Driver-Facilities
• Does not possess its own production facilities – joint development deals with vendors. • Urged vendors to organize themselves into the Japan Delicatessan Food Co-operative Society to maintain quality standards.
• Processing centers run by third parties purchase, store and process the materials and ingredients in bulk for production facilities.
• Store constructions focus on ease of purchase for customers and ease of use for employees.
Logistical Driver-Inventory
• Inconsistencies in the quality of raw materials rectified by ?Recipe Master‘.
• Provided links in distribution control of raw materials by detailing each raw material used at a plant and its quantity.
• It also enables accurate inventory control for raw materials by adjusting inventories to sales conditions.
Logistical Driver-Transportation
• Introduced ?combined unnecessary inventory. distribution‘ to reduce
• Follow just in time policy for eg: rice balls and box lunches are made and delivered 3 times a day.
• Introduced temperature-based delivery environment-friendly vehicles meeting the pollution emission control. and latest
• Reduced the number of vehicles visiting each store from 70 a day in 1974 to 6 per day in 2008.
Snapshot of 7-Eleven‘s CDS
Integrated Information Systems
• Supporting a. Formation of Corporate Strategies
b. Functional strategies – logistics, merchandise & shop management
c. Adaptability to change in environment
Strategy of Product Strategy of Distribution
Information Systems
Strategy of Store
Fourth Integrated Store Information System
Graphic Order Terminal
• Store manager Ordering Device • Handheld device with LCD screen, Mobility by walking around store for placing order by item • Past data analysis, information on new trends/developments • Returning to terminal to convey information to store computer
Fourth Integrated Store Information System
POS Register Graphic Order Terminal
• Records the customer‘s gender, (estimated) age and purchased items. • Data transmitted to store computer and headquarters • Data as of 11 pm transmitted everyday for analysis
Fourth Integrated Store Information System
POS Register Graphic Order Terminal Scanner Terminal
• Read bar codes and record inventory • Used to receive products from distribution center. • Reduce truck waiting lines
Fourth Integrated Store Information System
POS Register Graphic Order Terminal Store Computer Scanner Terminal
ISDN Network
• Central Computer, collecting data from POS, GOT & ST • Display information – Sales statistics, Customer base etc • Connected to ISDN & Artificial Intelligence
Fourth Integrated Store Information System
POS Register Graphic Order Terminal Store Computer Scanner Terminal
ISDN Network
Head Quarters
Delivery Centre
Vendor
District Management Office
Fifth generation systems.
Pricing
• Goods at reasonable prices (no practice of bargain sales) • Concentrating on value-oriented approach than priceoriented approach • Offering time convenience as a competitive strategy Negatives • Heavy threat from low-priced substitutes.
Sourcing
• Outsourcing to prevents internal organization Stiffness in growth • Price & Quality advantages • Taking advantage of technology to utilize external resources as if internal. • Philosophy of ?co-existence and co-prosperity?
• Co-development, Team-merchandising initiatives
• Eg. ?Japan Delicatessen Foods Cooperative
Association? for medium and small size producers
Unique initiatives by seven eleven
• Combined Distribution for temperature independent items
• Increasing Payload Efficiency
Other Initiatives
• Consolidated, Standardized Route Transport Between Manufacturers and Combined Distribution
• Using Objective Data from In-car Terminals to Eliminate Racing and Idling • Daily Safety Reports
Porter Analysis(why sales are declining?)
Conclusion – The Competitive Advantage & Strategy
Factor of Competition Threat by new entry Hostile relations with the trade Threat by substitute merchandise Bargaining power of buyer Bargaining power of seller Attractivenes Strategy Adopted s of Industry +++ --+++ Excellent Information Systems Strong relation & control with vendors in terms of bargaining power Value proposition of Convenience Offering differentiation in quality of products and services Giving more options in shopping
References
• ?Sustainability report of Seven Eleven Japan? www.sej.co.jp • ?The process of international business model transfer in the Seven-Eleven group: US - Japan – China? – Asia Pacific Business Review • The success of 7-Eleven Japan (English translation) World Scientific Publishing Co. Pte. Ltd. • www.wikipedia.org
Thank You
doc_634487856.pptx
The PPT explaining about Seven Eleven Group of Japan.
7-Eleven Japan Group 5
Retail Market in Japan
• Second largest in the world, worth US $1,124 billion in 2008.
• More than 42,000 convenience stores found across Japan. Major players are 7-Eleven, Lawson and Family Mart.
• Apart from food and FMCG products, it offers a wide range of services including ATM‘s, ticket reservations, bill payments and delivery services. • Most convenience stores are open 24 hours a day and 7 days a week.
History
• Has its origins in 1927 in Dallas, Texas, USA founded by Joe C Thompson. • Initially, stores open from 7 a.m. till 11 p.m. and hence, the company started using the name from 1946 onwards. • First Japanese store opened in May, 1974. • In 1980, the company was rescued from financial difficulties by Ito-Yokado, its largest franchise which was founded by Masatoshi Ito in 1964. • Ito-Yokado gained controlling stake in 1991 and formed Seven & I Holdings. 7-Eleven became its subsidiary in 2005. • As of 2008, of the 34,200 stores around the globe, 12,013 of them are located in Japan. 1,577 are in Tokyo alone.
New Product Development
• After the collapse of the bubble economy, consumers started selecting products based on value and quality rather than merely the selling price. • Started selling rice balls and box lunches — Japan‘s equivalent of Western fast food. • Set up the Nihon Delica Foods Association (NDF) with the manufacturers of rice based products in 1979. • To eliminate differences in quality control between Association members, constructed plants exclusively for Seven-Eleven Japan.
Supply Chain Strategy-Key Drivers
• Logistical Drivers
– Facilities
– Inventory – Transportation
• Cross Functional Drivers
– Information – Sourcing – Pricing
Logistical Driver-Facilities
• Does not possess its own production facilities – joint development deals with vendors. • Urged vendors to organize themselves into the Japan Delicatessan Food Co-operative Society to maintain quality standards.
• Processing centers run by third parties purchase, store and process the materials and ingredients in bulk for production facilities.
• Store constructions focus on ease of purchase for customers and ease of use for employees.
Logistical Driver-Inventory
• Inconsistencies in the quality of raw materials rectified by ?Recipe Master‘.
• Provided links in distribution control of raw materials by detailing each raw material used at a plant and its quantity.
• It also enables accurate inventory control for raw materials by adjusting inventories to sales conditions.
Logistical Driver-Transportation
• Introduced ?combined unnecessary inventory. distribution‘ to reduce
• Follow just in time policy for eg: rice balls and box lunches are made and delivered 3 times a day.
• Introduced temperature-based delivery environment-friendly vehicles meeting the pollution emission control. and latest
• Reduced the number of vehicles visiting each store from 70 a day in 1974 to 6 per day in 2008.
Snapshot of 7-Eleven‘s CDS
Integrated Information Systems
• Supporting a. Formation of Corporate Strategies
b. Functional strategies – logistics, merchandise & shop management
c. Adaptability to change in environment
Strategy of Product Strategy of Distribution
Information Systems
Strategy of Store
Fourth Integrated Store Information System
Graphic Order Terminal
• Store manager Ordering Device • Handheld device with LCD screen, Mobility by walking around store for placing order by item • Past data analysis, information on new trends/developments • Returning to terminal to convey information to store computer
Fourth Integrated Store Information System
POS Register Graphic Order Terminal
• Records the customer‘s gender, (estimated) age and purchased items. • Data transmitted to store computer and headquarters • Data as of 11 pm transmitted everyday for analysis
Fourth Integrated Store Information System
POS Register Graphic Order Terminal Scanner Terminal
• Read bar codes and record inventory • Used to receive products from distribution center. • Reduce truck waiting lines
Fourth Integrated Store Information System
POS Register Graphic Order Terminal Store Computer Scanner Terminal
ISDN Network
• Central Computer, collecting data from POS, GOT & ST • Display information – Sales statistics, Customer base etc • Connected to ISDN & Artificial Intelligence
Fourth Integrated Store Information System
POS Register Graphic Order Terminal Store Computer Scanner Terminal
ISDN Network
Head Quarters
Delivery Centre
Vendor
District Management Office
Fifth generation systems.
Pricing
• Goods at reasonable prices (no practice of bargain sales) • Concentrating on value-oriented approach than priceoriented approach • Offering time convenience as a competitive strategy Negatives • Heavy threat from low-priced substitutes.
Sourcing
• Outsourcing to prevents internal organization Stiffness in growth • Price & Quality advantages • Taking advantage of technology to utilize external resources as if internal. • Philosophy of ?co-existence and co-prosperity?
• Co-development, Team-merchandising initiatives
• Eg. ?Japan Delicatessen Foods Cooperative
Association? for medium and small size producers
Unique initiatives by seven eleven
• Combined Distribution for temperature independent items
• Increasing Payload Efficiency
Other Initiatives
• Consolidated, Standardized Route Transport Between Manufacturers and Combined Distribution
• Using Objective Data from In-car Terminals to Eliminate Racing and Idling • Daily Safety Reports
Porter Analysis(why sales are declining?)
Conclusion – The Competitive Advantage & Strategy
Factor of Competition Threat by new entry Hostile relations with the trade Threat by substitute merchandise Bargaining power of buyer Bargaining power of seller Attractivenes Strategy Adopted s of Industry +++ --+++ Excellent Information Systems Strong relation & control with vendors in terms of bargaining power Value proposition of Convenience Offering differentiation in quality of products and services Giving more options in shopping
References
• ?Sustainability report of Seven Eleven Japan? www.sej.co.jp • ?The process of international business model transfer in the Seven-Eleven group: US - Japan – China? – Asia Pacific Business Review • The success of 7-Eleven Japan (English translation) World Scientific Publishing Co. Pte. Ltd. • www.wikipedia.org
Thank You
doc_634487856.pptx