7 Eleven History: The Accidental Company
Summary
TLDRThe video explores the accidental origins of 7-Eleven, starting as an ice shop that evolved into a convenience store. It highlights the innovative employee who initiated the store's expansion by selling milk, eggs, and bread. The name '7-Eleven' was adopted to reflect the store's operating hours, which later transitioned to 24/7 service. The video also covers the accidental creation of the popular Slurpee and the brand's global expansion, including its acquisition by a Japanese company and its transformation into a luxury brand in some Asian markets.
Takeaways
- 🏪 7-Eleven, with nearly 10,000 stores in the US and over 60,000 worldwide, is a globally recognized brand.
- 🚀 The inception of the 7-Eleven brand was accidental, not the brainchild of a founder or entrepreneur.
- 🛒 The company's growth was significantly influenced by the actions of a dedicated employee, Johnny Jefferson Green, who introduced milk, eggs, and bread to the stores.
- ⏰ The name '7-Eleven' was adopted in 1946 to reflect the stores' operating hours from 7 AM to 11 PM, a practice that has since evolved.
- 🌐 The brand expanded globally, with a significant shift in perception, being seen as a luxury brand in some Asian countries.
- 🏠 Initially, 7-Eleven was an American company, but it is now majority-owned by the Japanese retailer Seven & I Holdings Co., Ltd.
- 🔄 The company has undergone several transformations, including a period of bankruptcy and a hostile takeover attempt in the late 1980s.
- 🏢 7-Eleven has transitioned from a centralized business model to a franchising system, which has been key to its global expansion.
- 🥤 The Slurpee, one of 7-Eleven's most popular products, was an accidental invention by an ice cream shop owner and was later acquired by 7-Eleven.
- 🌟 The brand has become a cultural icon, with stores offering a wide range of products and services beyond the traditional convenience store offerings.
Q & A
How many convenience stores does 7-Eleven have in the US and worldwide?
-7-Eleven has close to 10,000 convenience stores in the US and over 60,000 around the world.
What is the origin of the 7-Eleven brand name?
-The 7-Eleven brand name originated from the operating hours of their convenience stores, which were initially open from 7:00 AM to 11:00 PM.
Who is credited with the idea of selling items like milk, eggs, and bread at the Southland Ice Company shops?
-The idea of selling items like milk, eggs, and bread at Southland Ice Company shops is credited to an employee known as 'Uncle Johnny' Jefferson Greene.
How did the Southland Ice Company transition from selling ice to operating convenience stores?
-The Southland Ice Company transitioned to operating convenience stores by noticing the success of selling milk, eggs, bread, and other items during times when grocery stores were closed, leading to the replication of this model in other ice shops.
What was the significance of the totem pole in the branding of the Southland Ice Company shops?
-The totem pole became a significant marketing item after a Southland Ice Company associate brought one back from Alaska. It attracted customers, leading the company to adopt the name 'Totem Stores' and later use totem poles as a branding element.
Why did Southland Ice Company change its brand name to 7-Eleven in 1946?
-Southland Ice Company changed its brand name to 7-Eleven in 1946 to reflect the new operating hours of their stores, which were from 7:00 AM to 11:00 PM.
When did 7-Eleven stores begin to operate 24/7, and what was the catalyst for this change?
-7-Eleven stores began to operate 24/7 in 1963, with the catalyst being a visit from the University of Texas football team who stayed in the store until the next morning, leading to the decision to keep the store open round the clock.
How did the Slurpee soft drink become part of 7-Eleven's product offerings?
-The Slurpee soft drink became part of 7-Eleven's offerings after Omar Knedley, the owner of a chain of ice cream shops, discovered the slushy drink by accident when his soda fountain broke down. His business was later acquired by 7-Eleven, and the drink was branded and marketed as Slurpee.
What is the business model of 7-Eleven in terms of store ownership and management?
-7-Eleven's business model includes both company-owned and franchised stores. The company has expanded through building new locations and acquiring existing retail stores, and since the 1950s, it has adopted a franchising system where local businesses operate under the 7-Eleven brand.
How did 7-Eleven end up with majority ownership by a Japanese company?
-7-Eleven ended up with majority ownership by a Japanese company, the Ito-Yokado Corporation, after facing financial difficulties in the late 1980s and early 1990s, which led to a hostile takeover attempt and subsequent bankruptcy. The Japanese company bought 70% of the shares during this period.
How has the perception and service of 7-Eleven stores changed in different countries, particularly in Asia?
-In countries where 7-Eleven has expanded, especially in Asia, the brand is often perceived as more upscale, with stores located in affluent areas and offering services that include social settings and live entertainment, differing from the original Quickstop store concept.
Outlines
🏪 The Accidental Beginnings of 7-Eleven
The first paragraph introduces the 7-Eleven brand, highlighting its global presence with nearly 10,000 stores in the US and over 60,000 worldwide. It discusses the accidental origins of the brand, contrasting it with other major brands like Microsoft, Apple, and Amazon, which were founded by entrepreneurs with a clear vision. The story begins in the 1920s with the Southland Ice Company in Dallas, Texas, which identified a need for ice delivery to preserve perishables in homes lacking electricity and refrigerators. An employee, Johnny Jefferson Greene, noticed customers' need for milk, eggs, and bread when grocery stores were closed, leading to the sale of these items in the ice shops. This innovation led to a significant increase in revenue, prompting the company to expand this model to other locations.
🕒 The Evolution of 7-Eleven's Brand and Services
The second paragraph delves into the evolution of the 7-Eleven brand, starting with its adoption of the 'Totem' name after a totem pole was used as a marketing tool. The name '7-Eleven' was adopted in 1946, reflecting the stores' operating hours from 7 AM to 11 PM, although many stores later transitioned to 24/7 operation. The story of the Slurpee, a popular product, is also highlighted, which was invented by an ice cream shop owner and later integrated into 7-Eleven's offerings. The paragraph also covers the company's business model, which started as a centralized organization and later adopted franchising, allowing for global expansion. It also mentions the acquisition of existing retail stores, such as Speedy Mart, as part of 7-Eleven's growth strategy.
🌐 Global Expansion and Cultural Shifts of 7-Eleven
The third paragraph discusses the global expansion of 7-Eleven and the cultural shifts associated with the brand in different markets. It explains how the company, initially an American entity, became majority-owned by the Japanese retailer Ito-Yokado through 7-Eleven Japan. The narrative includes the challenges faced by 7-Eleven in the late 1980s, including a hostile takeover attempt and subsequent bankruptcy, which led to the Japanese investment. The paragraph also contrasts the brand's perception in the US, where it is seen as a convenience store for the average person, with its image in Asia, where it is often positioned as a luxury brand with stores in upscale areas and offering a more social shopping experience.
Mindmap
Keywords
💡7-eleven
💡Accidental Creation
💡Southland Ice Company
💡Totem Stores
💡24/7 Operation
💡Slurpee
💡Franchising System
💡Global Expansion
💡ITOCHU
💡Cultural Shift
Highlights
7-Eleven has nearly 10,000 stores in the US and over 60,000 worldwide.
The 7-Eleven brand's creation was accidental and not planned.
The company's growth involved at least three other accidental but positive steps.
7-Eleven is one of the few major brands with origins traceable to a dedicated employee's actions.
In the 1920s, ice sales were a significant business due to limited electricity and refrigerators.
Southland Ice Company, a merger of ice shops, identified a need for milk, eggs, and bread outside regular store hours.
The success of selling milk, eggs, and bread led to the replication of this model in other ice shops.
The new venture of selling additional items generated more revenue than ice blocks.
The brand name 'Totem Stores' was adopted after a totem post was used as a marketing item.
7-Eleven changed its name in 1946 to reflect the operating hours of its convenience stores.
In 1963, many 7-Eleven stores began operating 24/7, a significant shift from their original hours.
The Slurpee soft drink was accidentally created and later became one of 7-Eleven's most popular products.
7-Eleven has expanded its product range to include almost anything, from auto parts to hot meals.
The company initially operated as a centralized organization but later adopted a franchising system.
7-Eleven was acquired by the Japanese retailer Seven & I Holdings Co., Ltd., changing its ownership structure.
The brand's perception varies globally, being seen as a luxury brand in some Asian countries.
7-Eleven has evolved from a Quickstop store to a global presence in over 20 countries.
Transcripts
with close to 10,000 convenience stores
in the US and over 60,000 around the
world you've probably been to a 7-eleven
location for coffee
gasoline refill or a cuppa they're very
much loved slushy soft drink Slurpee but
did you know that the 7-eleven brand
coming into being was an accident and
not actually planned and there are at
least three other similarly accidental
but positive steps on the growth path of
the company stay with me to find out
also did you know that 7-eleven is one
of the few major brands whose origins
can be traced back to the actions of a
creative and dedicated employee in
today's episode of companies explained
we uncover the origins of this company
that many describe as the originator of
Kwik Stop department store concept we
take you through its history to see how
it became one of the most recognizable
features in the u.s. shopping culture
and that of other countries around the
world but before we get to it I humbly
request that you take a moment and
subscribe to our Channel you don't want
to miss any of our informative and
exciting videos about famous brands and
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we appreciate you choosing to watch our
video thanks now back to today's pick
the history of many major brands is
often written with the founder
entrepreneur being the one who conceived
the idea think Microsoft Apple Facebook
or Amazon this is not the case though
with 7-eleven the brand came into being
in what can be described as an accident
the founder or let's say the
entrepreneur who oversaw its growth in
the early days didn't come up with the
idea
instead it's one of his employees who
saw a business opportunity and acted on
it now let's get some background to this
story in the 1920s not many Americans
had access to electricity it was only
those who lived in the affluent
neighborhoods of major cities who did
and also it was still early days
for the refrigerator so even among those
who had access to electricity not many
had a refrigerator at home to keep their
perishables fresh but that does not mean
people did not preserve perishables
there was a way to do it and that was to
use a block of ice put next to whatever
needed to be preserved so if for example
you wanted the meat to last three days
or a week you had to pack it together
with ice do you know what this way of
preserving food did it created a demand
for ice which fortunately could be
bought from ice shops nearby in the city
of Dallas Texas selling ice was a big
business as was the case around the
country perhaps to increase efficiency
and cut costs in 1927 several ice shops
in the city merged to form Southland
ice company given the need to quickly
move the ice from the storage at the
store to the consumer homes the ice
doors were mostly closed - or in
residential areas one employee of the
Southland ice company who's been
identified as uncle Johnny
Jefferson Greene identified a need in
the customers he was serving they needed
items like milk eggs and bread when the
grocery stores around were closed he
talked to his employer one Josie
Thompson jr. about the possibility of
selling milk eggs bread and other items
at the ice shop with permission from his
employer uncle Johnny stopped these
items and soon people were buying
especially during the weekends and
holidays when most of the shops around
were closed noticing the success
Josie Thompson jr. decided to replicate
this enterprise in the other eye shops
around town and each was doing well
beyond expectations
soon business was booming and the new
venture was generating more revenue than
ice blocks and guess what this turned
out to be the survival path for
Southland ice company in the following
few years more Americans had access to
both electricity and refrigerators and
did not need to buy ice blocks to
preserve their perishables if ice blocks
remained their primary product they
would most likely have closed down
sooner or later then another accident
happened while traveling in Alaska an
associate of Josie Thompson
Jr by the name of Jenna Lyra came across
totems monumental carvings on large
poles that are part of the belief system
of the Alaskan indigenous people she
bought one of these totem posts and when
she reached home they set it up outside
the Southland ice company shops the
totem post became a magnet many locals
came to shop at the stool because they
wanted to have a look at it
noticing that the totem was an apt
marketing item the management of
Southland ice company went back to
Alaska I bought one for each of their
shops and that is how the business
acquired the brand name totem stores
first customers started referring to the
stores as totem shops and then the
company adopted the name and made it
their brand name and it stuck with them
for close to 20 years then why did they
change to 7-eleven in 1946 Southland ice
company decided to drop totem and take a
new brand name they settled on 7-eleven
why it described the operating hours of
their convenience stores opening at 7:00
in the morning and closing at 11 in the
evening this tradition that has the
source of their name has however changed
in 1963 many 7-eleven stores began to be
open 24/7 the story goes that one
evening in 1963 the University of Texas
football team coming from a tournament
decided to enter into a local 7-eleven
store for a celebratory evening they
didn't leave until the next morning the
next evening other students came by and
overstayed this falls the management to
allow the store to be open 24/7 soon
other 7-eleven stores followed suit how
true the story is we can't tell and if
you noticed this is another of 7-eleven
s accidental development steps it could
also be argued that the brand just
joined a trend at the time in the 1960s
many businesses especially in the big
cities were finding it necessary to open
24-7 given the availability of customers
to serve there is one more accidental
development regarding 7-eleven s growth
and it has to do with one of their most
popular products the Slurpee soft drink
however this did not say place within
the company it happened outside the
company before the drink became part of
the company staples Omar asked Nedley
was the owner of a chain of ice cream
shops in the Dallas area one day his
soda fountain broke down and he was
forced to put the drink in a freezer to
keep it fresh for the customers when he
got it out it was slushy but the
customers loved it more that way a light
bulb went off he could produce the drink
in this form for his customers he began
to offer the drink as a new item on the
menu he also patented it in the 1960s
his business became part of 7-eleven and
the new product was branded and marketed
as Slurpee 7-eleven has disclosed that
it sells about fourteen million cups of
Slurpees each month and since the
product was launched in 1966 over 7.2
billion Slurpees have been sold but it's
only one among many products over the
years the number of products sold in
7-eleven convenience stores has steadily
grown today you can buy almost anything
at a 7-eleven store car auto parts
gasoline coffee burgers pizzas
refreshments hot meals shoes and more
let's turn our attention to the business
model of 7-eleven at its inception the
Southland company which was behind totem
and later 7-eleven was run as a
centralized organization each store was
owned and managed from the main office
in Dallas Texas over the years the
company expanded through the building of
new locations but also through the
acquisition of existing Quickstop retail
stores an example of an existing company
that 7-eleven acquired was speedy Mart
which had hundreds of locations around
the country in the 1950s when it was
acquired the tradition of acquiring
existing businesses as a growth strategy
has continued to date in January 2018
7-eleven acquired approximately 1030
convenience stores in 17 US states that
used to be owned by Sonico this is after
the latter chose to focus on retail fuel
outlets
as part of the deal 7-eleven was to
surrender 26 Rito few outlets of its own
to sonico acquisitions have worked well
for 7-eleven as a way to acquire larger
market share but also to gain industry
knowledge and experience but 7-eleven no
longer runs as a centralized business in
the 50s the company adopted a
franchising system this is the model
where local businesses and entrepreneurs
enter into contractual relationships
with the company so that they use the
7-eleven trademark and brand in recent
years franchises have formed a more
significant percentage of the brand size
including revenue through franchising
7-eleven has managed to expand to many
countries around the globe ownership
7-eleven was an American company the
majority ownership of the company was
American until the 1990s 70% of the
company is now owned by the it ohya
Carter company a japanese retailer
through 7-eleven japan but how did an
American company end up being owned by a
Japanese company during the Great
Depression in the 1930s 7-eleven managed
to survive by closing some of its
operations and selling some parts of its
businesses to pay off debtors this
worked well and the company came through
stronger and more robust the company
found itself in a similar but not the
same situation in the late 1980s in 1987
a Canadian financier named Samuel bells
burg threatened to carry out a hostile
takeover at the company the Thompson
family which was still in control of the
company decided to buy him out they
borrowed a lot of money to achieve this
in addition to selling a lot of company
assets while they succeeded at beating
Samuel bells burg the recovery strategy
did not work as well as it did during
the Great Depression the debt
accumulated from the buyout event ended
up becoming toxic and the company had to
file for bankruptcy in 1990 it is at
this weak point that the Japanese
company came in and bought 70 percent of
the shares in Southland company
finally in 1999 Southland Corp the
entity that have been behind 7-eleven
changed its name to 7-eleven
incorporated we can now say that
7-eleven is more global than American it
has a presence in more than 20 countries
around the world with this there's been
a cultural shift and in particular how
the brand stores are placed at the
market
when 7-eleven was launched it was a
Quickstop store for the ordinary person
on the street and this is how is largely
remained to Americans to date but in the
countries where the brand has expanded
too especially in countries in Asia such
as Thailand China Taiwan and Indonesia
the brand is treated as being a luxury
brand to some extent the locations are
mostly in upscale areas of town and the
people you're most likely to run into
are the affluent type the service is
also different some 7-eleven locations
in some of these countries are social
settings complete with stages for live
bands the 7-elevens of the 1950s are
definitely not the 7-elevens of today we
really appreciate you sitting through to
watch this video please subscribe and
share thank you
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