Popular convenience store chain 7-Eleven has announced the closure of more than 400 stores in North America.
7-Eleven’s parent company, Japan-based Seven & I Holdings, announced Thursday that the chain would close 444 “underperforming” stores in North America.
Seven and I discovered, as part of its earnings report, that a variety of issues related to changing consumer habits were causing store closures.
“The decline in consumer spending has persisted beyond previous expectations,” according to the statement.
With more than 13,000 stores in the United States, Canada and Mexico, the closures represent only 3 percent of its portfolio.
7-Eleven’s earnings report revealed that changes in consumer habits had a significant influence on its store closures, driven largely by inflation.
Its earnings report revealed that inflation was a major influence, stating that since 2019, rent, utilities, groceries and fuel had increased more than 25 percent.
In its earnings release, the company said: “The North American economy remained broadly strong thanks to the consumption of high-income earners, despite persistent inflation, a high interest rate and a deteriorating employment environment.”
“In this context, there was a more cautious approach to consumption, particularly among low- and middle-income people,” they added.
Consumer habits began to focus more on quality products for less, according to the company’s report. Revealing that 69 per cent of shoppers wanted more quality products and 60 per cent focused on good value for money.
Its report revealed that traffic at North American locations had fallen 7.3 percent in August, after the company experienced six consecutive months of declining traffic.
The company also highlighted the change in cigarette sales, which saw a 26 percent decrease in total packs sold, from 10.3 billion in 2019 to 7.6 billion in 2024.
This decline was not saved because buyers made different choices: only 18 percent switched to other nicotine products and more buyers switched to cheaper products.
The company’s earnings report revealed that traffic at North American locations had fallen 7.3 percent in August, after experiencing six consecutive months of declining traffic.
With more than 13,000 stores in the United States, Canada and Mexico, the closures represent only 3 percent of its portfolio. The chain also has more than 21,000 stores located in Japan.
A 7-Eleven spokesperson said fast company: ‘We made the decision to optimize a series of non-core assets that do not fit into our growth strategy. At the same time, we continue to open stores in areas where customers are looking for more convenience.”
The closures are also expected to generate a $30 million operating income benefit this year and a $110 million increase in annualized run rate, according to its earnings release.
News of the hundreds of store closures comes after Seven & I cut its profit forecast for the financial year ending February 2025.
Which was also accompanied by the company’s plans to split into two businesses, Fast Company reported.
According to Bloomberg, their separation and store closures are also an attempt to reassure disgruntled investors and keep takeover bids at bay.
The company hopes to focus on the best-performing locations that are experiencing higher demand.
Daily Mail has contacted 7-Eleven for comment.
