7-EleveninTaiwan MKTG 680
Popular in International Marketing Management
Popular in Marketing
This 4 page Study Guide was uploaded by Celen Vasquez on Tuesday February 10, 2015. The Study Guide belongs to MKTG 680 at San Francisco State University taught by Professor Fischer in Fall. Since its upload, it has received 173 views. For similar materials see International Marketing Management in Marketing at San Francisco State University.
Reviews for 7-EleveninTaiwan
Amazing. Wouldn't have passed this test without these notes. Hoping this notetaker will be around for the final!
Report this Material
What is Karma?
Karma is the currency of StudySoup.
You can buy or earn more Karma at anytime and redeem it for class notes, study guides, flashcards, and more!
Date Created: 02/10/15
7 Eleven in Taiwan Adaptation of Convenience Stores to New Market Environments Core Issue The balance between standardization and localization in business format franchising across national borders It was the business of convenience stores that originated in the United States because of 7 Eleven Defining characteristic of 7Eleven open 24 hours a day Ep ogue The globalization of 7Eleven Instead of US franchise by PCSC from Taiwan their homegrown business icon Standardization of Business Format 3 Distinctive Features of the American Landscape 7Eleven chains were separated from each other by long distances because the US was geographically the third largest country in the world Areas where people usually congregated became central locations for 7Eleven stores Ex street corners Also known as gas station retailer 7Eleven stores were largely located in US rural areas where population density was low Because of this customers occasionally drove to a store Other defining features Big parking lots Total store area Standard floor plan shelves refrigerators microwaves cash counter All physical components of the store Standard products across stores Large vendors that stocked the stores controlled by the head office of 7Eleven Chain Operation Field Consultants would visit the franchises to make sure they were all standardized They acted as mentors International Expansion The concept of convenience stores had evolved outside of the United States and had the same general meaning to consumers 1969 The first place of 7Eleven expansion was in Canada mportant 7Eleven Inc was usually guarded however about enforcing any directives on the product range for three reasons customers in a convenience store were largely from the local community their needs would be largely local and the products they were buying would also likely be largely local It was in the product offerings that local nuances came into play pg 3 First issue 7Eleven started to expand rapidly that the number of stores outside of the United States was far more than the stores in the US Convenience Stores Industrv in Taiwan Taiwan s high population density was a natural platform for the growth of not only retailing but but also the convenience store industry In Taiwan the zoning was vertical characterized by high rise buildings Advantage of vertical zoning there would always be people entering or exiting the building Some unique Taiwanese traits were conductive to the growth of the convenience store industry 1 Taiwanese people had an obsession with immediacy They did not like to wait Taiwanese entreprenuers were drawn toward franchising business models because they liked to measure their own density they were friendly and greeted customers 7Eleven in Taiwan UPEC parent company of PCSC Their principles good quality good credibility good service plus fair price UPEC set up PCSC to handle distribution initially The first 7Eleven store opened in February 1980 in Taiwan The growth of 7Eleven could be divided into 3 phases imitation localization and innovation Phase One Imitation PCSC sole franchisor At the imitation phase the sole priority was to establish a good working relationship with the American partner They wanted to conform with the US model Taiwan s scarcity limited opportunities to build new stores from the ground up As a result of scarity it was harder to conform to US model of stores with standard size floorplan and format This phase witnessed several minor problems on the part of the PCSC in setting up thefranchise as recalled by Hsieh It had opened several stores mainly in residential communities within city centres which meant the target consumers were housewives however price was a main concern for these women and 7Eleven was positioned as a high end convenience store Second stores had opened simultaneously across Taiwan particularly in the north central area and the south which had spread resources thin Third rather than renting space PCSC was buying premises which had led to high upfront COStS Given these initial issues 7Eleven s expansion into Taiwan was smooth without major setbacks December 1990 PCSC had become the largest retailer in Taiwan with revenues of NT108 billion Phase Two Localization The second decade marked the beginnings of the realization that the mistakes of the first decade needed to be undone PCSC started to loosen up some of the established systemss and structures principally those that pertained to ownership location and merchandise Began renting properties from landlords they were no longer owners They were also franchising into stores in addition to opening its own stores This meant less capital outflow less managerial time spent in monitoring operations more rapid growth and greater flexibility in the choice of the sites and store locations This approach also led to greater decentralization in operations because of the leeway given to the franchisees in making decisions at store level New franchisees were setting up the stores in high density locations such as railroad stations The move into city centres meant that they no longer had to appeal to price sensitive consumers but now needed to appeal to a new group of consumers which were young urban professionals 7Eleven appealed to young urban professionals by promoting American products such as the slurpy backed by advertising and local media Merchandise offered an opportunity to conform and to deviate 7Eleven in Taiwan retained the US model by selling the same merchandise they did PCSC had started to provide local flavours in their stores to appeal to the local market The success in marketing local foods led to the decision to extend to the concept of local convenience in two ways moving beyond selling packaged foods to selling fresh foods and selling products that could be consumed immediately rather than be held for stock PCSC changed the store profile and increased the convenience factor Part three Innovations It found a window of opportunity in IT New innovations involved technology instead of just merchandise T laid the foundation for iBon an ecommerce kiosk connected to an cloud server This lT platform enabled 7Eleven to become a distribution channel of digitized services in its own right The nature and number of transactions that customers could do on the ibon platform seemed endless The biggest advantage of iBon was it increased footfalls Ex license renewal Service offerings were another area that opened up infinite possibilities for PCSC changing the conventional nature of its 7Eleven stores The basic idea was to increase revenue not only through footfalls but also through a fee for some kind of service
Are you sure you want to buy this material for
You're already Subscribed!
Looks like you've already subscribed to StudySoup, you won't need to purchase another subscription to get this material. To access this material simply click 'View Full Document'