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QSR Feature
The Big Bite on QSRs
With 7-Eleven rolling out 25 new products each week, quick-serves stand a good chance of going from competitors to collateral damage in the next two years.
7 Eleven Fresh Foods like this salad pose a threat to quick service restaurants.

When 7-Eleven franchise owner Tony Ngyuen peers out the doors of his Dallas store to point out the competition, he’s not looking at either of the two other convenience stores located within a couple miles. Instead, his eyes are focused on a nearby Subway.

“Subway is my big challenge,” Ngyuen says. “If a customer comes in with a bag from there, I tell them, ‘You can buy that same meal here. And if you do buy a sandwich here the next time, I’ll give you a free Big Gulp.’”

And that’s not his only plan to sink Subway’s business. Ngyuen is also contemplating a new promotion—one to beat its popular Meal Deal. But he says he’ll only introduce it if his sales start slumping, and, as of press time, that’s far from the case.

It’s been more than a year since Ngyuen became one of the Dallas-Fort Worth’s first 7-Eleven franchisees, and his store’s fresh food and beverage sales are up, today accounting for nearly 40 percent of his total sales.

“Every convenience store sells gas and cigarettes. Most are the same,” Ngyuen says. “But 7-Eleven’s difference is fresh food.”

No, it hasn’t always been that way. Ngyuen, who started working for 7-Eleven back in the mid-’80s, says he can remember when sandwiches were made in the back room.

“Some were good, some were no good. Nobody focused on it,” he says.

Then, a little more than 15 years ago, the nation’s largest chain of convenience stores made a decision that would alter the course of the company’s development.

“7-Eleven saw long-term demand changing in certain segments, like tobacco, and wanted to find growing product categories,” says Dennis Phelps, 7-Eleven’s vice president of fresh foods. “We recognized the growing need for fresh, quality foods as consumers became more pressed for time.”

Today, the sandwiches and other fresh food items sold in Ngyuen’s and the 5,500 other 7-Elevens nationwide are made in commissary kitchens and delivered to the stores within hours of preparation. Each wrapped item is labeled with an expiration date—within one or two days to ensure freshness. Each is made with high-quality ingredients from food companies including Kraft, Sargento, and Jennie-O. And each was tested for portion size, appearance, value, and quality to ensure consistency.

But according to Ngyuen, freshness and quality are just two of the four reasons why he’s giving nearby quick-service restaurants a run for their customers’ money. Reason No. 3: “There’s more here to choose from,” he says.

In fact, in his store Ngyuen offers 12 kinds of sandwiches. He sells the staples like turkey, tuna, and chicken salad. But he also offers breakfast croissants and biscuit sandwiches, stuffed pitas, and gourmet selections like molasses and honey ham wraps. His grill sales are sizzling, too. The hot rods roll two sizes of the ever-popular proprietary Big Bite, Cheeseburger Big Bites, Smokie Big Bites, five varieties of taquitos, and the brand new egg-roll-like Asian Rollers. The bakery case houses a dozen kinds of doughnuts, muffins, and danishes. There are two salads in the refrigerated case to choose from—the Santa Fe Style Caesar or the Cobb. And if you’re having a snack attack, you can grab a nacho tray, an apple and cheese platter, or a berries and granola yogurt.

There’s a good chance you could visit the store and see something you didn’t see the day before. Nguyen, like all 7-Eleven operators, decides each morning what items he’ll offer the next day. By 10 a.m., he puts his order into the company’s computer system that then relays it to the appropriate suppliers. Sandwiches, salads, and baked goods are prepared the same day and delivered to stores overnight.

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