Case Study of Seven Eleven

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Seven-Eleven
Case Study of Seven Eleven
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Abstract
Seven-Eleven has been in the supermarket scene for along time now with
excellent service and now has a reputation in the entire world. The venture started in 1974, and
now they have over 70,000 stores across the globe. Seven-eleven uses various strategies to
dominate the market. They dominate the area through effective item distribution in the stores;
they have systems and franchise effectiveness. Seven-Eleven understands the local demands and
stocks in relevance to the request keeping proper SKU as well as having a robust supply chain to
back the system. Market analysis is also their forte by continuous improvement of local item
variations according to local requirements, thus analyzing the local demographic. All this work is
backed up by an excellent distribution system that involves Direct Shipment Distribution. In their
Japanese outlets, they followed the Combined distribution centre model, which resembles the
Cross-docking Strategy, though, in the United States, they used the Direct Store Delivery
method. Seven-Eleven introduced original items and promoted them to cater to the local people's
needs, which then showed 52% of total store sales came following original articles. Seven-
Eleven introduced modern I.T. systems that would help them organize orders and distributions
efficiently. But Seven-Eleven understood various risks in their supply line and monitored the
nitty-gritty details at all times. All of these services made Seven-Eleven a renowned store
throughout the world.

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Responsiveness in the store chain means to meet the demands and requirements of the
customers where and when they need it. As responsiveness begins to rise, the convenience store
chain faces more uncertain situations. Specific strategies can be followed to abate from the case,
Keeping in-house cooking options can be arranged. The food can be assembled and stocked on
demand from the people. The inventory can be set to stay fresh raw materials. This method can
also be done by keeping all the required items for cooking on the list. Demand rise will lead to a
quick response from the convenience store, and supply will be met. Superstores have food items
and cooked items in their stock, and with this method, with proper inventory and rapid response
to the demand response rate will increase. Now to both these methods, there are some risks
involved. Due to a shortage of demand, the inventory will not be used to its full extent, leading to
low utilization of the resources and inventory wasted. Obsolete inventory and clutter are a
nightmare to deal with,especially if the expiry date passes. But to tackle this problem, swift
replenishment can be done for the inventory whenever the need arises. This system will also fix
the lack of inventory when demand surges, but this also has the risk of increasing replenishment,
travel, and receiving cost. Some other methods can be implemented, such as emphasizing and
catering to local preference only, providing original items to them, and setting up pickup stations
and varied payment services. Still, all this will come at an increase in labour costs and
information systems constant. Convenience stores can utilize all these to improve responsiveness
and cater to people's needs wherever and whenever.

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The micro-matching of supply and demand with rapid replenishment means to stock the
inventory to full as soon as it empties, assuming the demand pattern will be similar all the time.
Seven-Eleven in Japan uses its modern technology to analyze demands and replenishes supply in
less than 12 hours, making it very responsive to customer orders. But there are a few risks to this
method.
1) Collaborative Risk: The replenishment process involves the collaboration of various
aspects of the supply chain. All the things should be considered, from making sure the
supplies have appropriately reached the stores to receiving and confirming the received
supplies. This method is directly linked to having efficient transportation from and to the
destination and warehouse. With frequent movement, the transport costs will rise
andhuman resources to ensure the proper collection of the items.
2) Risks inside the System: The Rapid Replenishment process needs an information-sharing
system inside the supply chain. This system will ensure proper inventory is kept or not.
The system can be automated, or a workforce can be arranged to facilitate the procedure.
For obvious reasons, this system will incur costs for both the design and staff. Proper
security must also be maintained because sensitive information will be kept there and,
once leaked, could reveal unwanted information to the people.
3) Management risks: The whole process will require people to identify the requirements,
analyze them, and then arrange transport to deliver the inventory items to replenish. This
method will need people in all the sectors to standby and act swiftly. With more people to
manage, there are risks of the system failing.
4) Risk of shortage: If a specific item isultimately out of stock, a group of customers might
search the next convenience stores for that item losing customers. Due to these