Reliance Retail to launch 7-Eleven convenience stores in India after Future Retail’s exit
The first 7-Eleven round-the-clock convenience store will be opened by Reliance Retail in India’s financial capital Mumbai on October 9, 2021.
The retail arm of Reliance Industries Ltd. (RELI.NS) announced on October 7, 2021, that it will roll out 7-Eleven Inc convenience stores in India. The announcement came days after Future Retail Ltd. (FRTL.NS) decided to end a similar deal with the US Chain.
The first 7-Eleven round-the-clock convenience store will be opened by Reliance Retail Ventures Ltd. in India’s financial capital Mumbai on October 9, 2021.
The announced deal marks the latest by the Reliance Group, led by billionaire Mukesh Ambani, to rapidly expand its e-commerce and retail businesses in order to compete better with Amazon and Walmart Inc’s Flipkart in India’s nearly trillion-dollar retail market.
In the morning trade, Reliance’s shares rose to 1.22%, while the Future Retail Stock gained 3.7% in a strong market.
Reliance Retail has entered into a franchise agreement with 7-Eleven, for the launch of 7-Eleven convenience— ANI (@ANI) October 7, 2021
stores in India. The first 7-Eleven store will open on October 9 in Andheri East, Mumbai: Reliance Retail
7-Eleven convenience stores in India: Significance
The 7-Eleven stores will provide shoppers a unique style of convenience by offering a wide range of snacks, beverages, and delicacies that are particularly curated to appeal to the local tastes, along with a refill of daily essentials.
The US multinational chain of convenience stores is also expected to significantly contribute to local employment.
Partnership between Reliance Retail and 7-Eleven
The 7-Eleven Inc President and Chief Executive Officer, Joe De Pinto said that India is the second-largest country in the world and is one of the fastest-growing economies. It is an ideal time for the largest convenience retailer in the world to make entry into India.
DePinto added that the strategic relationship between Reliance and 7-Eleven will bring 7-Eleven’s brand of convenient products and services to millions of Indian consumers starting in Mumbai.
Why Future Retail ended a deal with 7-Eleven?
Future Retail Ltd. informed that it had mutually terminated an agreement with 7-Eleven as the companies were not able to meet the targets of the opening stores and paying the franchise fees.
Future Retail’s plan of 7-Eleven in India
Future Retails Ltd. in 2019 had said that it plans to set up 7-Eleven convenience stores from scratch in India and also convert some of its existing operations into the US brand.
However, according to Future Retail’s annual report, the unit which was formed to run 7-Eleven stores in India had reported a loss of Rs. 173 million without opening any stores.
Future Retail Ltd. is India’s second-largest retailer with more than 1,700 stores, including the popular Big Bazaar supermarkets and the local chains Food Hall and Nilgiris.
About 7-Eleven Convenience store
7-Eleven Inc. based in Irving, Texas is known for its iconic products including the Slurpee. A multinational chain of convenience stores operates and franchises more than 77,000 stores in 18 countries and regions.
The multinational chain was founded in 1927 as an ice house storefront in Dallas. After 70% of the company was acquired by Japanese affiliate Ito-Yokado in 1991, the chain was reorganized as a wholly-owned subsidiary of Seven-Eleven Japan Co Ltd in 2005. It is now held by Chiyoda, Tokyo-based Seven & I Holdings Co. Ltd.
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