Business Strategy for 7-Eleven: PESTLE, SWOT, VRIO and Porter's Five Forces Analysis

This report provides a strategic management plan for 7-Eleven using PESTLE, SWOT, VRIO and Porter's Five Forces Analysis. It includes an analysis of the macro and internal environment, competitive environment, and a strategic plan for growth and business expansion. The report suggests that 7-Eleven should focus on product development or market development to increase market share and sales. Ansoff matrix and gap analysis are recommended tools for further analysis.

BUSINESS STRATEGY

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
1- Applying and conducting a PESTLE analysis to analyse the impact of macro environment
of 7-Eleven...................................................................................................................................3
2- Analysing the internal environment with the help of SWOT and VRIO analysis..................4
3- Evaluating the competitive environment of 7 Eleven utilizing a porter's five forces analysis6
4-Strategic plan for 7-Eleven.......................................................................................................7
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Business strategy is referred as suitable plans and actions which are undertaken by
business organizations in order to carry out their daily business practices and increase their
overall productivity. The current report will be based on 7-Eleven is a popular retail convenience
store chain which has a significant market share in the industry.
This report will explain the macro environment of the business with the help of PESTLE
analysis, SWOT and VRIO frameworks will be used in order to evaluate the internal
environment of the business, Competitive analysis will take place by using Porter's five forces
analysis and a range of models and frameworks will be used in order to produce a strategic
management plan for 7-Eleven.
MAIN BODY
1- Applying and conducting a PESTLE analysis to analyse the impact of macro environment of
7-Eleven
The external environment of a business comprises various factors which have a
significant influence over the business. These factors are shown with the help of PESTLE
analysis which is an effective framework that explains the key elements of the external
environment of a business (Lin and et.al., 2021). These factors are as follows:
Political factor
Instability in the political environment of the host country has a negative impact on the
overall productivity of the business (Kitsios and Kamariotou, 2021). Different government
policies and global pressures on the business may restrict them to achieve better results which
has a negative impact on the effectiveness of the business to produce better quality of output in
the industry.
Economic factor
The higher growth and development of the US economic conditions has a positive impact
on the success of the 7-Eleven in the industry. The spending of consumers have increased
overtime which may be a crucial factor for improving the profitability of the company. With the
help of these factors the business may be able to expand in different nations and increase its
market share in the global retain industry.
Social factor

The frequent changes in trends, consumer preferences, religious belief etc. may have a
negative impact on the stability of 7-Eleven in the competitive business environment. The
changing attitudes of the customers due to these factors may lead towards their shifting to other
alternatives which are available to them. This aspect has a negative impact on the effectiveness
of the business in the industry.
Technological factor
The technological advancements in the retail industry have been beneficial for 7-Eleven
as it has adopted digitalization in order to make effective changes in the business environment.
User-friendly digital systems and online applications have a positive impact on the business in
order to provide better services to their customers and increase their trust towards the
organization (Ciampi and et.al., 2020).
Legal factor
The data protection laws and procedures which are imposed by the governments of
different countries may increase restrictions for the business to successfully operate in the
industry. These aspects may have a negative impact on the overall image of the business which is
not beneficial for maintaining its sustainability in the business environment.
Environmental factor
The carbon and energy footprint which is released by the organization in the environment
has a negative impact on its quality. Governments may not support such activities of the business
towards the environment which can have a negative influence on its effectiveness in the industry.
The company may adopt various sustainable practices in order to reduce the negative impact of
these aspects on their productivity in the environment.
2- Analysing the internal environment with the help of SWOT and VRIO analysis
SWOT analysis is an effective framework which is used by the business in order to
evaluate the internal factors which are crucial for achieving better productivity. These factors
are:
Strengths
7-Eleven offers 24/7 services to the customers which is helpful in motivating them
towards buying products and services from the company. The individual product branding
strategy of the business is its major strength which increases its brand equity in the industry.
Weaknesses

The major weakness of the brand is it consists of less variety in their products which
restricts many customers to explore their stores. The prices are comparatively higher for the
products offered which has a negative impact on its sales.
Opportunities
The organization may expand to various developed and developing countries in order to
expand their market share and increase its opportunities to grow in the global retail industry (Ali
and Anwar, 2021). Exclusive products can be added by the business in their stores for attracting
more customers towards their organization.
Threats
There is tough competition in the retail market which has reduces the effectiveness of
businesses to achieve better quality of output and enhance their services. Managing the security
of data may have a major threat on the business to improve their sustainability.
VRIO model is an effective framework which is helpful for the business to gain practical
competitive advantage in the industry with the help of in-depth analysis.
Valuable
There are various resources which are utilized by the business which are beneficial for
identifying competitive benefit of the business which is valuable for their overall development in
the industry (Queiroz and et.al., 2020).
Rare
These valuable resources are costly which has a negative impact on the overall success of
the business which increases difficulties for the business to manage their profitability.
Imitation
It is expensive to replicate the process of 7-Eleven by their competitors which is
beneficial for the business to manage their overall market share in the industry (Ilmudeen and
Bao, 2020). It is helpful to reduce the adoption from their competitors which has a negative
impact on the overall success of the business.
Organization
7-Eleven handles their business practices effectively which is helpful for it to grow and
maintain their consistency. With the help of this aspect, the business is able to gain better
advantage in the industry and improve their services for further development.

3- Evaluating the competitive environment of 7 Eleven utilizing a porter's five forces analysis
The competitive environment within the world of business is increasing day by day,
which drive the attention of organization and its management toward evaluating the same term in
effective manner. For purpose of conducting this practice, they may take approach to utilize and
apply a specific strategic model such as porter's five forces, which enable to determine a factor or
force and also identify the extent to which they may put direct impact on organizational
performance and productivity, either in negative or positive manner. The chosen model
encompasses varied key elements and these are:
Bargaining power of suppliers-
The degree of this force is low, because number of suppliers as stakeholders available in
the corporate world, among which 7 Eleven and its management may select a specific group. The
extent of this factor or force may affect positively upon organization in term of increasing sales
and profitability. There are large number of suppliers that are available to the organization which
helps the business to choose between the best possible alternatives and reduce their costs which
are heavily incurred on these aspects. The company can easily shift towards suppliers which
offer them with better prices of the raw materials in order to improve their overall profitability in
the industry.
Bargaining power of customers-
The degree of this force is high in the market as there are several options which are
available to the customers that has a significant impact on the overall development of individuals
in the business. The online delivery services are one of the most competent forces which may
have a significant influence in attracting the customers towards the business and may reduce the
overall advantage of the business. The customers that are targeted by the organization prefer
products at lower prices which motivates them to quickly shift towards cheaper alternatives. This
aspect may have a negative impact on the overall success of the business to produce better
quality of output in the industry.
Threat of new entrance-
This force comprises high degree of power as it is easy for new businesses to enter the
market and capture a significant market share in the industry. The customers want products at
lower prices which can be offered by the new organizations in order to gain their trust. This may

have a negative influence over the competitive advantage of 7-Eleven in the competitive
business environment. With the help of these aspects the business is able to improve their
services and enhance the quality of output which is produced by them.
Threat of substitute products and services-
This force has high degree of influence on the business environment and creates
difficulties for the organization to grow in the industry. Customers may shift towards the
substitutes such as food products from local bakeries, shops, online stores etc. which can have a
negative influence on the profitability of the business. It may restrict the 7-Eleven to acquire
more customers and improve their interest in the products and services that are offered by the
organization.
Competitiveness between existing companies-
The degree of this force is high as there are many competitors in the industry that has a
significant market share. Walmart, Wawa, Murphy USA etc. are some major competitors of 7-
Eleven which have an established market in the industry and have loyal customers. These are the
key players in the industry which creates difficulties for the business to enhance their services
and gain better advantage. It is easy for the customers to shift towards these businesses which
can reduce the overall success of the company in the industry.
4-Strategic plan for 7-Eleven
As it is found that due to rise of technology, companies and retailers are implementing new
software and technologies within their business. In regard to 7 Eleven it is known that it is
focusing on customer engagement and for increasing their loyalty, it is providing them effective
platform from where people can get information regarding nearby convenience 7-eleven stores,
offers that this retail chain is providing. Along with it, it is offering various payment options to
company (Madhani, 2018). It is found that there are number of retailers that are also using same
features of technology and 7-Eleven wants to be in the competition and wants to become the
market leader. Strategic plan is one of the best ways by which company can develop models in
order to accomplish set goals. Strategic plan of 7-Eleven is as follows:
Mission: Mission of this company is to provide customers what they want at the time of
they want and at convenient place. Its tagline: Take it to Eleven has made it beneficial. Its focus
on quality and payment methods can make it able in taking competitive advantages.

Goals: It is found that since its establishment, it wants to make life for its customers more
convenient and effective. It wants to provide qualitative products and services to customers at
affordable price.
Business strategy: It is found that 7-Eleven follows omni channel approach in order to
promote its products and services. Its main focus is on increasing sales thorough shoulder
campaign for slurpee product that cited benefits of product. In addition, it is known that for
increasing satisfaction and experience of customers, it uses Apple pay, Google pay and Amazon
cash. It believes that different modes of payment are win-win strategy and it makes customers’
feel valued and convenient.
Marketing and promotional strategy: 7-eleven is known for offering one stop location
for fulfilling customers’ needs. Products in which its deals and offer to customers include:
different taste and variety of sandwiches, salads, bakery items, ice cream, gas and snacks. In
regard to pricing strategy, it is known that it has higher prices for its products and services and
one of the main reasons of its higher prices is: private labelled products. Currently company has
around 70,000 stores that are spread across 17 countries. It provides franchise to potential owners
that is being applied directly by its website (Oh and et.al., 2021). For attracting customers, it
provides rewards to them and has developed rewards campaign. It provides special rewards to its
existing and potential customers with the main aim of making them feel valued. It is believed
that when customers’ needs are being concerned then they are less likely to switch brand. It can
increase staff retention rate and can improve image of company.
Some models that can help it out in growth and business expansion include:
Ansoff matrix is one of the best and effective strategic tools that is being developed to facilitate
businesses in decision making and business growth. 4 main growth strategies of this model are as
follows:
Product development: It is just opposite of market development as within this strategy,
companies focus on making changes in existing products. When companies try to increase sales
in existing market but with new innovative products then it is known as product development.
Market development: It is the strategy by which companies focus on entering in new market
with its existing products. When the focus is one entering in new market with same products and
services then it is known as market development (Lim and et.al., 2020).

Market penetration: When companies focus on increasing sales in existing market with
existing products by focusing on other factors then it is known as market penetration.
Diversification: It is quite risky strategy as within this strategy, companies enter in new market
with new product. When company finds that its existing product will not make it beneficial in
new market then it should go with this strategy.
On the basis of its case study and its internal capabilities, it can be suggested that it
should go with either product development or market development. By entering into new
markets with existing products, it can increase market share and sales as well. There are number
of advantages of market and product development strategies These both strategies are less risky
than others and it can make company able in increasing market share as well as sales. By
focusing on product development, it can attract customers and can retain them with business and
it can improve its image as well.
In addition, for more knowing effectiveness and current status, company should use gap analysis.
There are number of tools that can be used by company for knowing the gap between its
estimated performance and actual performance.
Current situation GAPs Desired outcomes
An effective responsiveness to
customers’ needs
There is increasingly change
in customers’ taste, industry
environment as well as current
market trends
Quick responsiveness to
customers’ complaints and
needs.
Complex network of supply
chain
Uncertainty in environmental
factors and transportation
system. Changing marketing
needs also making supply
chain complex
(Haegerbaeumer and et.al.,
2019).
Tight and easier network of
supply chain
High prices of most of the
products
High administration cost and
increasing rise in fuel price is
increasing travelling cost.
Smart and affordable prices
for each category of product

Suppliers’ improved relation
with 7-Eleven can make it
able in taking competitive
advantages
This company has improved
communication skill and it
makes its able in improving
relation. But increasing rise of
substitutes companies can
affect it.
Optimising strategic
relationship with suppliers and
retaining them with business.
On the basis of above discuss gap analysis, it can be said that this company should focus on
network system and pricing policy. By making changes in these both strategies, company can
take competitive advantages and can accomplish its goals (Li and et.al., 2021).
CONCLUSION
According to the above report it has been analysed that there are several factors which
have a crucial impact on the overall success of the business organization in the competitive
industry. These internal and external factors helps the organization to identify the challenges and
prepare better plans for reducing their impact on the business. The competitive analysis has
shown that various forces have a high impact on the productivity of the business in the industry
which is not beneficial in order to gain better advantage (Wynn and Olayinka, 2021). With the
help of an effective strategic management plan the business has been able to create better
opportunities to grow in the business environment. These strategic decisions which are taken in
the interest of the business play a vital role in improving the overall performance of the business.

REFERENCES
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