Updated: October 13, 2021 3:40:07 pm
Just two days after Future Retail and 7-Eleven Inc terminated their over two-year-old agreement to open 7-Eleven stores in India, the Irving, Texas-based retail chain announced a tie-up with Reliance Retail to open convenience stores in India with the first launch slated for Saturday.
When and where will 7-Eleven stores open in India?
According to a statement by Reliance Retail, the company has entered into a master agreement with 7-Eleven Inc for the launch of 7-Eleven convenience stores in India. The first 7-Eleven store is set to open on Saturday, October 9 at Andheri East, Mumbai. This will be followed by a rollout in key neighbourhoods and commercial areas, across the Greater Mumbai cluster to begin with. Reliance Retail already operates a chain of its own grocery stores under the Reliance Fresh banner.
What are 7-Eleven stores and who will they compete with?
7-Eleven branded stores operate as round-the-clock convenience stores. The chain operates, franchises and/or licenses more than 77,000 stores in 18 countries and regions, including 16,000 in North America.
In India, Modi Enterprises-run 24 Seven chain of convenience stores operate in this format. Unlike other major economies, India has not witnessed the big box store concept extensively given that Indian rules prohibit foreign funding in multi-brand retail. However, going ahead, 7-Eleven stores could also face competition from online delivery services like Dunzo, Swiggy, Grofers, etc investing in setting up late-night delivery infrastructure having their own warehouses and storage moving away from the hyperlocal model they operated till now.
Why did Future Retail terminate its contract with 7-Eleven?
Future Retail had entered into a master franchise agreement with 7-Eleven back in February 2019. In a stock exchange filing on Tuesday, the company said: “The termination has been with mutual consent as the Future-7 was not able to meet the target of opening stores and payment of franchisee fees. No financial or business impact on the Company as this arrangement was at subsidiary company level”.
Future7-India Convenience Ltd was the wholly-owned subsidiary of Future Retail that entered into the agreement with 7-Eleven. The Future Group had last year agreed to sell its retail assets to Reliance Retail but the deal was challenged by e-commerce giant Amazon and is currently caught up in a legal tussle.
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