SEVEN-ELEVEN JAPAN, CO.

Seven-Eleven Japan, Co.

Seven-Eleven Japan, Co.

This paper is based on a case study revolving around the operations, business strategy, and supply chain strategy of Seven-Eleven, one of the leading convenience stores in the world.

Q1: Seven Eleven Supply Chain Strategy

Seven-Eleven Japan has implemented a number of different strategies to their supply chain in order to maximize their profits. One significant strategy Seven-Eleven Japan employs is harnessing the power of their information flow. Another factor in Seven-Eleven Japan's success is their remarkably efficient ordering system that aids in their strategy to strive for continued fresh products. Seven-Eleven Japan's logistics include logical and strategical placement of new stores supported by their network and collected regional data (http://dimatos.net).

The first major strategy that Seven-Eleven Japan uses to its advantage is to utilize and maximize the flow of information throughout the organization. Seven-Eleven Japan analyses a weekly cycle of information flow and then arranges a weekly business meeting at Seven-Eleven Japan Headquarters that include the CEO, 100 corporate managers, and other members of management (http://dimatos.net). During the meeting, they review performance for the previous week as well as discuss and develop strategies for the upcoming week.

Another one of Seven-Eleven Japan's key strategies is their ordering system implementation. Seven-Eleven Japan uses an electronic ordering system (EOS), which is controlled by a handheld computer at each store. Every store manager can walk around his store with this unit, inputting numbers and ordering items.

A key part of Seven-Eleven Japan's ordering strategy is to simply know how to analyze their POS data. They analyze and gather data in different ways. First, they place orders based on the knowledge of various local factors including school events, roadwork, holidays, etc. Secondly, they have a vast knowledge of changing consumer behavior. They keep track of this knowledge in a number of different ways but one successful way is at the point of sale. Employees take note of many personal factors when customers are checking out including but not limited to, gender, (approximate) age, and other noticeable specifics.

Their last, and possibly the most important strategy, is their remarkable retail strategy. This strategy breaks down into two major parts, which they refer to as “freshness” and “dominant opening.” Seven-Eleven Japan uses a two-part definition of freshness. Their first definition applies to the physical freshness of perishable products. The overall goal of Seven-Eleven Japan's is to have fresher products over their competitors. This is achieved by keeping perishables for about half the time that their competitors do. They also use a series of labels and charts to make sure their stores are maintaining predetermined freshness standards.

The “dominant opening” portion of Seven-Eleven Japan's retail strategy has to do with the opening of new stores. They have specific rules for the location of stores in order to utilize sales zones that cover the maximum geographic area while minimizing overlap between stores in one area. Resulting in the most efficient distribution, with the least competition, yielding lower delivery times, and customer recognition for their ...