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7-Eleven to Close 444 Locations Amid Economic Pressures

2024-10-14 14:35:23.387000
[num] WABC-TV

7-Eleven has announced the closure of 444 underperforming locations across North America, representing approximately 3% of its total 13,000 stores. This decision, reported by parent company Seven & I Holdings on October 12, 2024, is driven by a combination of factors including slowing sales, declining customer traffic, inflationary pressures, and a significant 26% drop in cigarette purchases since 2019. CEO Joe DePinto noted a 7.3% decline in customer traffic as of August 2024, marking six consecutive months of declines, which he attributed to cautious spending among low-income consumers amid high inflation and interest rates [f99a902f].

In light of these challenges, Seven & I Holdings is shifting its focus towards enhancing food offerings, which have become the highest sales category for the chain. The company plans to invest in high-selling food items such as milk, bread, egg sandwiches, and miso ramen, reflecting a strategic pivot to attract more customers in a competitive landscape that includes rivals like Wawa and Sheetz [f99a902f].

Additionally, 7-Eleven is looking to introduce international food items in its U.S. stores, further diversifying its product offerings to meet consumer demand [f99a902f]. These closures underscore a significant shift in consumer behavior, particularly in the context of inflation and high interest rates, which have led to more cautious spending among shoppers. Retail analyst Neil Saunders described the closures as a 'gentle pruning' for efficiency and profitability [f99a902f]. As 7-Eleven works to adapt to these market dynamics, the company aims to improve its food selection and overall customer experience to better align with current consumer demands. Furthermore, 7-Eleven is currently facing a $47.2 billion takeover bid from Couche-Tard, which adds another layer of complexity to its operational strategies and future direction [f99a902f].

According to a recent report from WABC-TV, the closures are a direct response to the ongoing economic pressures affecting the retail sector, particularly the decline in cigarette sales and a notable shift in consumer purchasing habits among middle- and low-income earners [f99a902f]. The company is also grappling with the implications of high inflation and interest rates, which have contributed to a more prudent approach to consumption among its customer base [f99a902f].

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