7-Eleven Philippines gains Php683-M income in 2013, proves business flexibility and adaptability in changing times
May 31, 2023
July 22, 2014
MANILA, Philippines (July 22, 2014) — Philippine Seven Corporation (PSC), local licensee of the world’s leading convenience store chain, 7-Eleven, has once again proven its flexibility and adaptability in business, improving its sales and income in 2013, a dynamic year in the country that saw many triumphs amid disasters.
PSC’s systemwide sales rose 29% over the previous year to PhP17.2 billion, while its income grew from PhP465 million in 2012 to PhP683 million in 2013.
Jose Victor Paterno, President and Chief Executive Officer of PSC, attributed the company’s growth and record-breaking income to its ability to find opportunities in any given situation.
Contributing to PSC’s performance was exceptional growth in store sales, success with its loyalty card and store expansion as the company reached its goal of 1000 stores in 2013.
Paterno said there was a sharp rise of 47% in income pertaining to growth in store sales due to several factors such as dry and warm weather, mid-term elections, breakfast bundling promotions, and most importantly, the increase in tobacco sales in the first half of 2013.
He noted much of the growth in same store sales came from a dramatic increase in tobacco sales in the first half of 2013, a one-time event unlikely to recur. This was despite supply becoming scarce as some cigarette brands held back price increases due to higher sin taxes in a bid to gain market share.
PSC adapted by convincing suppliers to pump supply through its system. The strategy was simple, PSC set about exposing sales and inventory data across stores and distribution centers to assure manufacturers that it would neither hoard nor profiteer if they would keep PSC supplied. As a result, cigarette sales spiked as 7-Eleven stores became known for reliable supply of fairly priced product.
PSC opened a total of 180 stores in 2013, ending the year with 1,009 stores. This resulted in a 22% growth in store base. PSC successfully doubled its store count in three years as mandated by President Chain Store Corporation of Taiwan (PCSC), the parent company of PSC.
In addition, PSC opened its first store in Bacolod in 2013, as part of their aggressive expansion plans in the Visayas. The company began the year 2014 by opening its first store in Iloilo. To date, there are a total of 80 stores in Visayas.
PSC is targeting a store expansion rate of 25%, doubling store count every three years, a best guess and will likely change in response to conditions and unknowns, according to Paterno.
Meanwhile, in seeking to serve customers’ daily needs, PSC took advantage of technology, one of its core competencies by launching their loyalty program, the Every Day! Rewards Card.
Customers purchase the card for PhP10, register via SMS, web, or Facebook, and earn points for every transaction. Points are redeemable for a rotating selection of food and drink, usually in take home sizes, and recently for wifi minutes in 7-Eleven stores.
Paterno said after only three months since Every Day! Rewards was launched in November 2013, the loyalty card was used for over 10% of transactions. It took the loyalty card market leader 10 years to achieve the same penetration.
“Getting to know our customers better is the first leg of our digital strategy. Other legs will emerge this year and next, driven by our view that convenience stores will play an important role in facilitating access to technology-enabled efficiencies in emerging markets,” he said.
Reliable and convenient
And as ever, more adaptable and opportunity-focused, PSC continued to launch new offerings and innovations to provide quality and value to its customers. The company also staged events such as Run 1000 and Trail 1000 in early 2014 to connect with its customers beyond the store.
Participants registered online, paid at any 7-Eleven store via the 7-Connect online payment system, and claimed their race kits in the same store. Both events received a good turnout, showing confidence that 7-Eleven events are convenient and well-organized.
According to PSC Chairman of the Board, Vicente Paterno, “Combining ease of access to customers with a deserved reputation for reliability of our services is important to promote other uses of 7-Eleven stores in our country.”