7 eleven franchisees are asking their franchisor to reconsider their requirement that retail outlets resume operations 24 hours a day from May 24, 2021, as they “face a crippling labor shortage, higher operating costs, lower gross margin and lower net profit, “according to a Monday (May 3) ad.
The National Coalition of 7-Eleven Franchisee Associations (NCASEF) is asking 7-Eleven Inc. (SEI) to adjust the terms of this franchise agreement.
âAs labor and other direct store operating expenses continue to increase, franchisees earn less and work more,â said the executive vice president of NCASEF. Michael jorgensen. âOne possible remedy for franchisees is to increase retail prices, but this creates a competitive disadvantage in the market, which can hurt sales and profits.â
As SEI’s fresh food program “takes a broader focus in the convenience store industry,” the announcement said, the initiative would result in greater demand for labor.
â7-Eleven wants to be a place customers think about for fresh food, but our franchise agreement is based on a convenience store model, not a quick service restaurant model,â Jas dhillonNCASEF Treasurer and Los Angeles Area Franchisee said.
Businesses in the service sector are struggling to hire, even with the easing of pandemic-related limitations across the country. As a result, some major national and quick-service restaurant (QSR) companies have kept food areas closed, and other merchants have reduced their hours of operation, according to the announcement.
SEI gave the green light to franchisees’ demands to shut down overnight when the pandemic struck. However, franchisees now say it will be very difficult to find manpower to work night shifts. Additionally, franchisees in several markets say day-to-day sales barely cover labor costs. A number of franchisees will be required to perform the shifts themselves due to the shortage of available manpower, according to the announcement.