7-Eleven

7-Eleven began in Texas in 1927.  Before the days of refrigeration, ice blocks were sold for iceboxes to keep perishables cold.  People kept fewer perishable foods and had to shop frequently.  The convenience store was born when the founder Jefferson Green began selling milk and eggs from his icehouse and then realized that staying open during the evening and Sundays, when grocery stores were closed, was a strategic advantage.  Southland Corp. eventually owned the convenience store chain and began the franchising.  In business school more than 30 years ago, we had a case study on Southland, and learned how they screwed up a good thing.  The lesson I learned from the case study is that business people are incredibly smart when they apply hindsight.

In the U.S. I barely paid attention to 7-Eleven.  I don’t smoke cigarettes, drink soda and have no desire to overpay for a gallon of milk or 6-pack of beer.  So I had little reason to go there, or know what a Big Gulp or Slurpee was.  Some 7-Eleven stores have gas pumps, but I would pay at the pump by credit card, eliminating the need for me to go inside and see what I had been missing.

When I moved to Taiwan, I discovered the importance of 7-Eleven to the well-being of Taiwanese society.  7-Eleven has 44,000 stores around the world, with a significant number of them located in Asia.  Japan has almost 14,000 stores and little Taiwan has almost 5,000.  I haven’t done the per capita density calculations, but I would bet Taiwan is densely packed with these stores.  And there is competition from the OK Mart, Family Mart, Mr. Brown Coffee and others.

Much of the population of Taiwan is packed into several large cities.  It is not uncommon in these cities to have two or three 7-Eleven stores on one city block.  Why?  Because 7-Eleven rules Taiwan.  At 7-Eleven you not only buy convenience foods, newspapers and coffee, but you use them to pay your traffic tickets, renew/refill many types of prepaid devices, mail letters, pay your bills, conduct minor banking, reserve taxis, ship and pickup packages, purchase concert tickets, pay school tuition and obtain stitches for minor cuts (6 stitch limit) and so much more.  There is almost nothing you can’t do at 7-Eleven, except buy betelnuts.

 7-Eleven already rules Taiwan, and much of Japan. I predict they will rule the world within the next half century.  I hope some business school reads this blog 50 years from now and realizes that I did not use hindsight to make this prediction.