7-Eleven Struck Back Against an Owner Who Took a Day Off(nytimes.com)
nytimes.com
7-Eleven Struck Back Against an Owner Who Took a Day Off
https://www.nytimes.com/2020/01/06/business/7-eleven-japan.html
71 comments
Uh 7-11’s name came from the fact it was open from 7am to 11pm originally, so being open 24 hr/day is not an inherent promise of the brand.
> Because our customers have come to rely on our stores to meet their needs and their schedules, all 7‑Eleven stores operate 24 hours a day, 7 days a week, where allowed by law.
That is straight from the FAQ on their franchise site, so they do think it is part of the brand - despite the history of their name, which I'll admit I didn't know - and thank you for the TIL moment.
https://franchise.7-eleven.com/franchise/faq
That is straight from the FAQ on their franchise site, so they do think it is part of the brand - despite the history of their name, which I'll admit I didn't know - and thank you for the TIL moment.
https://franchise.7-eleven.com/franchise/faq
It's just a name. It does not have to perfectly 1-to-1 reflect all the current agreements and contracts they hold up in the franchise relationship. The name of the franchise is not the text of the contract. How are we even discussing this?
You are absolutely right (1) and I have no idea why people down vote you, even if they think its irrelevant.
We, here at our office desks, are quick to demand that this store or that service is open 24/7.
The guy needed a day off. Go somewhere else and get your chocolate bar.
1: https://en.wikipedia.org/wiki/7-Eleven
We, here at our office desks, are quick to demand that this store or that service is open 24/7.
The guy needed a day off. Go somewhere else and get your chocolate bar.
1: https://en.wikipedia.org/wiki/7-Eleven
Yes, as a customer I like the same experience when I go from one chain to another - that's the value of their brand.
If he wants a day off then he should take a day off - I don't think 7-11 is setting his working hours or vacation days, but they do expect him to manage his store the way he's agreed to.
If he wants a day off then he should take a day off - I don't think 7-11 is setting his working hours or vacation days, but they do expect him to manage his store the way he's agreed to.
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Shame on the New York Times for such a bs title.
They care that he closed the store not that he took the day off.
"Man loses franchising rights after violating core aspect of the franchise brand" doesn't have the same ring to it I guess.
They care that he closed the store not that he took the day off.
"Man loses franchising rights after violating core aspect of the franchise brand" doesn't have the same ring to it I guess.
What’s really odd is that this is an article at all.
In a world where billions of things happen every day, how does a garden-variety franchisee contract dispute in Japan become an article in the New York Times?
In a world where billions of things happen every day, how does a garden-variety franchisee contract dispute in Japan become an article in the New York Times?
Because it helps one of the narratives they've been pushing for at least a decade: "business all bad, people being exploited, we are their/your champions", never mind any actual truth.
There is so much exploitation going on that surely they can find something that's actual exploitation.
If they did then they'd be ruffling feathers on some alpha predator they'd rather not piss off.
Shame on you for not reading the article.
The entire point was that as a small franchise owner he has to work 24/7 on the clock every day of the week due to the company off-loading all of the risk and issues onto the owner. You don't see a problem with a company mandating that their employees work every single hour of every single day?
The entire point was that as a small franchise owner he has to work 24/7 on the clock every day of the week due to the company off-loading all of the risk and issues onto the owner. You don't see a problem with a company mandating that their employees work every single hour of every single day?
>The entire point was that as a small franchise owner he has to work 24/7 on the clock every day of the week
That's not the entire point of being a small franchise owner at all. He is allowed to have and has employees. He is supposed to run a schedule of them to keep the business staffed around the clock. That doesn't mean he has to personally be there for every single hour that it's open! How absurd.
>off-loading all of the risk and issues onto the owner.
There is no offloading of all risk and issues to the business owner. All risk and issues are already inherently the owners. That's what it means to be a business owner. It's how they earn their share of the venture. If things work out you can earn a lot more money than as an employee. If things don't then you crash and burn. That's what you signed up for when you created or bought a business.
>You don't see a problem with a company mandating that their employees work every single hour of every single day?
Sure I do. That's in no way what happened here though. He isn't the employee of 7 Eleven. He is a business owner who has leased their brand in exchange for agreeing to certain terms. He gets more customers because people trust that his business, as a 7 Eleven, will be open all of the time and in exchange he has to be open all of the time. And again, they don't want him personally there 24/7. Just his business open.
That's not the entire point of being a small franchise owner at all. He is allowed to have and has employees. He is supposed to run a schedule of them to keep the business staffed around the clock. That doesn't mean he has to personally be there for every single hour that it's open! How absurd.
>off-loading all of the risk and issues onto the owner.
There is no offloading of all risk and issues to the business owner. All risk and issues are already inherently the owners. That's what it means to be a business owner. It's how they earn their share of the venture. If things work out you can earn a lot more money than as an employee. If things don't then you crash and burn. That's what you signed up for when you created or bought a business.
>You don't see a problem with a company mandating that their employees work every single hour of every single day?
Sure I do. That's in no way what happened here though. He isn't the employee of 7 Eleven. He is a business owner who has leased their brand in exchange for agreeing to certain terms. He gets more customers because people trust that his business, as a 7 Eleven, will be open all of the time and in exchange he has to be open all of the time. And again, they don't want him personally there 24/7. Just his business open.
> He is allowed to have and has employees.
An article that was posted to HN last year [1] profiled several convenience store franchise holders who, it sounded like, weren't making enough money to afford employees.
After all, if your country has 1.5 jobs per job seeker, raising wages; and you're only making $20 an hour of sales on the overnight shift, you're going to be losing money on that shift.
Of course, you might argue that a business that marginal should just close down - but if you spent $$$$ setting up, stocking and advertising the store, which might have seemed a good investment before another store opened nearby cutting into your sales, the decision to close down might not be an easy one.
It also says that 7-11 has an "area-dominant strategy" where, essentially, having a high density of franchise stores is their business strategy. That's in contrast to many franchises that include an area of exclusive territory, so there's one successful franchise rather than two struggling ones.
[1] https://www.japantimes.co.jp/news/2019/05/27/national/behind...
An article that was posted to HN last year [1] profiled several convenience store franchise holders who, it sounded like, weren't making enough money to afford employees.
After all, if your country has 1.5 jobs per job seeker, raising wages; and you're only making $20 an hour of sales on the overnight shift, you're going to be losing money on that shift.
Of course, you might argue that a business that marginal should just close down - but if you spent $$$$ setting up, stocking and advertising the store, which might have seemed a good investment before another store opened nearby cutting into your sales, the decision to close down might not be an easy one.
It also says that 7-11 has an "area-dominant strategy" where, essentially, having a high density of franchise stores is their business strategy. That's in contrast to many franchises that include an area of exclusive territory, so there's one successful franchise rather than two struggling ones.
[1] https://www.japantimes.co.jp/news/2019/05/27/national/behind...
> the decision to close down might not be an easy one.
So what, we should adjust the laws, break the contracts and make everyone else jump hoops around him and give him special treatment because he has to make a difficult decision? This is not kindergarten, this is business.
So what, we should adjust the laws, break the contracts and make everyone else jump hoops around him and give him special treatment because he has to make a difficult decision? This is not kindergarten, this is business.
You make it sound like you don't know seven eleven is supposed to be open 24/7/365.
That's their whole shtick. If the owner didn't like it he could have opened a normal grocery store. No one forced him to go to 7-11.
That's their whole shtick. If the owner didn't like it he could have opened a normal grocery store. No one forced him to go to 7-11.
And you sound like you didn't read the article, like the other poster I was responding to.
The issue isn't necessarily that they're open 24/7. It's that they offload all of the risk and management of that onto their franchises. If a local 7-Eleven has trouble hiring people to work late night shifts, then the expectation is that the owner is supposed to work it 24/7. You MUST be open 24/7 every single day of the year and as the article demonstrates, shutting down for even a day means losing everything.
I'm not surprised to see people on HN defend such incredibly hostile and toxic work environments, but I am disappointed. Why don't you try working such hours and see how things work out for you and your family?
The issue isn't necessarily that they're open 24/7. It's that they offload all of the risk and management of that onto their franchises. If a local 7-Eleven has trouble hiring people to work late night shifts, then the expectation is that the owner is supposed to work it 24/7. You MUST be open 24/7 every single day of the year and as the article demonstrates, shutting down for even a day means losing everything.
I'm not surprised to see people on HN defend such incredibly hostile and toxic work environments, but I am disappointed. Why don't you try working such hours and see how things work out for you and your family?
You seem to be under the impression that a franchisee is an employee of the franchisor. That is not the case. The franchisee lost his rights because he did not adhere to the terms of the franchise agreement. That's business. Nothing to see here.
> It's that they offload all of the risk and management of that onto their franchises. If a local 7-Eleven has trouble hiring people to work late night shifts, then the expectation is that the owner is supposed to work it 24/7. You MUST be open 24/7 every single day of the year and as the article demonstrates, shutting down for even a day means losing everything.
Yes, that's how franchises work, if they have a requirement in the franchise agreement, you have to keep it. If you don't like it, don't buy the franchise.
Yes, that's how franchises work, if they have a requirement in the franchise agreement, you have to keep it. If you don't like it, don't buy the franchise.
Not to be snarky, but do you know what a 'franchise' is? I mean it seems from your comments in this thread that that would take away a lot of the confusion. This man is not an 'employee'.
nobody stops him to hire employees, if it's not worthy financially then just give up such business
> He said that 7-Eleven had offered to pay for his remaining inventory — owners are responsible for buying their own products from the company at wholesale prices
This feels like an American MLM scam, just tuned to be actually profitable for the "owner" under normal conditions and therefore sustainable.
(Is this normal for legitimate American etc. franchises too, or is this specific to Japan's setup?)
This feels like an American MLM scam, just tuned to be actually profitable for the "owner" under normal conditions and therefore sustainable.
(Is this normal for legitimate American etc. franchises too, or is this specific to Japan's setup?)
MLM has a specific definition which this doesn't meet. MLMs are businesses where the majority of your earnings come from the recruitment of new members into your downline rather than sale of a product. 7-Eleven doesn't offer referral bonuses for bringing a new member that are based on a percentage of that person's sales.
Yes, I know that, I'm not claiming 7-Eleven is an MLM. I said it's like an MLM in this one way: many of them require that you buy a huge chunk of inventory up front whether or not you sell it, which is one of many abusive tactics of current American MLMs. (So is the actual multi-level bit.) See e.g. question 7 about "inventory loading" at https://www.ftc.gov/tips-advice/business-center/guidance/bus...
Mostly, this guy doesn't seem like an "owner" in the traditional sense to me - he seems to be unable to stock his shelves with inventory from other sources, and he certainly seems unable to set his own hours. He sounds like his work is directed by 7-Eleven. Another common scammy aspect of MLMs is convincing you that you're a small business owner on the path to future profits when you're one of many pawns of the actual business.
Mostly, this guy doesn't seem like an "owner" in the traditional sense to me - he seems to be unable to stock his shelves with inventory from other sources, and he certainly seems unable to set his own hours. He sounds like his work is directed by 7-Eleven. Another common scammy aspect of MLMs is convincing you that you're a small business owner on the path to future profits when you're one of many pawns of the actual business.
It's a franchise. It's a very common model and while you may not like it, it is not a scam.
But at no point did OP claim it was a scam? They even ask if this is normal for American franchises, instead of accusing 7-11 of predatory behavior.
> This feels like an American MLM scam
OP pretty directly implied it.
OP pretty directly implied it.
Is one no longer allowed to say "I wonder why thing A has properties that resemble thing B" without pretty directly implying "Thing A is exactly thing B"?
My hope was to have a conversation about whether the franchise model is bad in ways that have overtones of scams, or whether MLMs are only scams by virtue of the MLM bit and not because of any of the other behavior that is often called scammy, or any such thing, but apparently that was too much to ask.
My hope was to have a conversation about whether the franchise model is bad in ways that have overtones of scams, or whether MLMs are only scams by virtue of the MLM bit and not because of any of the other behavior that is often called scammy, or any such thing, but apparently that was too much to ask.
> many of them require that you buy a huge chunk of inventory up front whether or not you sell it, which is one of many abusive tactics of current American MLMs
Purchasing unrefundable stock is not inventory loading. It does not “resemble an MLM” in a meaningful way - you might as well say that any company that offers a recruiting bonus to employees resembles an MLM.
If you want to talk about predatory business practices, there’s plenty of it around in the franchise model. When you keep saying “like an MLM” you sound like you think these attributes are specific to MLMs.
Purchasing unrefundable stock is not inventory loading. It does not “resemble an MLM” in a meaningful way - you might as well say that any company that offers a recruiting bonus to employees resembles an MLM.
If you want to talk about predatory business practices, there’s plenty of it around in the franchise model. When you keep saying “like an MLM” you sound like you think these attributes are specific to MLMs.
Not really the same thing, but I used to work for a small food business that sold bottled/canned drinks from a fridge via a contract with Frucor (New Zealand), and the prices they charged wholesale to this small business were often higher than what you could buy the drinks for retail at nearby supermarkets.
This is what happens when the franchisee's are in what I will refer to as a "predatory" relationship. I've been involved with several Quick Service(Fast Food) Franchisee's in the USA and there's predatory relationships and then there's those where the franchisee's have some type of union or owners organization.
In McDonald's the Franchisee's have several different organizations they can join to represent themselves and bring grievances to to corporation. Cost of product is almost always a focus and you'd never be in a situation where you could buy product for cheaper anywhere else due to their scale. It's all about who has the leverage in the situation. I will say that reading that 7-11 offered to buy back all product is a very gracious move on their part. They had no incentive to help him out of the situation he no longer wanted to be in.
In McDonald's the Franchisee's have several different organizations they can join to represent themselves and bring grievances to to corporation. Cost of product is almost always a focus and you'd never be in a situation where you could buy product for cheaper anywhere else due to their scale. It's all about who has the leverage in the situation. I will say that reading that 7-11 offered to buy back all product is a very gracious move on their part. They had no incentive to help him out of the situation he no longer wanted to be in.
Not that uncommon, that is why during some sales you see people buying up as much as they can, to stock their own stores.
Would it have been illegal to buy and resell stock from the supermarkets?
No, but it's usually against the agreement you have with the supplier, which will, like this story, probably end with a terminated agreement.
Depending on your local laws, the nearby supermarket might have been selling below cost, so it might not be as huge a pricing discrepancy as you imagine.
Depending on your local laws, the nearby supermarket might have been selling below cost, so it might not be as huge a pricing discrepancy as you imagine.
In the US— It’s a lot cheaper for the franchisee to start than financing his own store. They also pay 50% of gross revenue and the store owners sometimes steal or manipulate the numbers/inventory. Internal theft and CC skimmers on outside gas pumps seems like a huge problem but I don’t know the exact numbers. Sometimes stores get shut down by corporate.
Like McDonald's franchises?
I don’t know about convenience store franchises but this is the model for every major fast food franchise in the US.
I saw the movie "The Founder" (Michael Keaton is Ray Croc of McDonalds fame).
They had trouble with francisees offering their own menus, having dirty restaurants and more...
Their trick was to become a real estate company who owned the land, and then lease to the franchisee. If there was any problem, they had complete control over the franchise.
That said, as a customer the whole POINT of 7-11 is to be always open. (although I wonder what stores are still open 7am-11pm instead of 24 x 7)
They had trouble with francisees offering their own menus, having dirty restaurants and more...
Their trick was to become a real estate company who owned the land, and then lease to the franchisee. If there was any problem, they had complete control over the franchise.
That said, as a customer the whole POINT of 7-11 is to be always open. (although I wonder what stores are still open 7am-11pm instead of 24 x 7)
Aren't there a crazy number of convenience stores everywhere in Japan, and where not, there are vending machines?
Also, I find something incredibly cozy about my city going to sleep at night. Almost nothing is open, not even most convenience stores, and I just find that so cozy.
Also, I find something incredibly cozy about my city going to sleep at night. Almost nothing is open, not even most convenience stores, and I just find that so cozy.
I'm the opposite. I like knowing that at 3am there's somewhere that's open where I can buy things like contact lens fluid, pain relievers, etc. (7-Eleven happens to have those)
The best thing that recently happened to my living situation is a 24 hour convenience store that opened below my apartment. It’s like a 2nd fridge/pantry/medicine cabinet.
While unrelated to the point you are making, I would suggest daily contracts - more hygienic, and don’t require fluid. I used both types and like dailies way better.
Perhaps just plan ahead for your contact lens solution. I get that it's convenient, but working those shifts is miserable (I did it).
I'm an imperfect human being. I'm going to go through contact lens solution and put off replacing it until I squeeze the bottle late at night and nothing comes out. I'm glad there are people I can pay at any time of the day to fix my self-inflicted problem.
Sure, but it's not great fun for the person on the other side of the counter.
Most people don’t work for fun.
I imagine you understood what I meant by "not fun", but ok. I suppose my view is, if you can't plan ahead for your trivial purchases, I don't really care. I'd rather just shut the store down and let you bemoan the fact that you can't buy snacks and Tylenol at 3am.
Reach outside of your bubble and realise there are likely tens of thousands of people in your city who live a different schedule to you, for work and other needs like care and support.
There is room for a night time economy based around the people and services that run while you sleep in your standard schedule. Big cities wouldn't be possible without the efforts of people on AM heavy schedules.
There is room for a night time economy based around the people and services that run while you sleep in your standard schedule. Big cities wouldn't be possible without the efforts of people on AM heavy schedules.
Also not to forget, if there are people awake at night without outside pressure, then there's probably people fine with working at night.
In Germany you can't work on Sundays. I always wanted to work on Sundays as a student, Fridays and Saturdays were worse, since that's the only days where most social gatherings happen.
On the news I hear people saying they don't want to force people to work on Sundays. I'm thinking maybe, just maybe, not everybody is the same.
I even agree we need limits. But how about limiting it to working 5 days a week, instead of picking an arbitrary day where you can't work.
In Germany you can't work on Sundays. I always wanted to work on Sundays as a student, Fridays and Saturdays were worse, since that's the only days where most social gatherings happen.
On the news I hear people saying they don't want to force people to work on Sundays. I'm thinking maybe, just maybe, not everybody is the same.
I even agree we need limits. But how about limiting it to working 5 days a week, instead of picking an arbitrary day where you can't work.
Germany is a very catholic heavy country, it's hard to do anything except church on sundays. Or fleamarkets on the now completely deserted shopping mall parking areas... Think an IKEA parking space completely empty on a sunday. They fill it up with flea markets instead :-)
I personally find this a particularly cruel take. It implies that nobody is poor, nobody has accidents ever, like a spilled bottle of pills, and that there should be no capitalism at all. It's very confusing - if people are willing or want to start a business that is open at night, with a goal of supplying medicine, food, and other necessities during hours that other stores do not offer such services at all, it seems like they should be allowed to do that.
Calling medicine that is potentially life-saving purchases at 3am "trivial" is unnecessarily cruel even for HN. Yes, 7-Eleven sells a lot of medicine that can save someone's life that they might not "stock up on" because they have insufficient money to stock up on every possible medicine and plan for every possible event.
Calling medicine that is potentially life-saving purchases at 3am "trivial" is unnecessarily cruel even for HN. Yes, 7-Eleven sells a lot of medicine that can save someone's life that they might not "stock up on" because they have insufficient money to stock up on every possible medicine and plan for every possible event.
We're almost there. In "perfect" capitalism, there would be a very hot market for employees willing to work the graveyard shift, and since there was clearly a need for those workers, they would be paid quite a lot.
In reality, those who work those shifts are often people who don't have much of a choice where to work, much less which hours they're assigned. Sometimes managers will be nice and keep you on a regular shift so you develop a sane sleep schedule -- not usually.
Just like working on holidays, I don't bemoan anyone who wants to eat fast food, or the workers who want to make a little more money. But let's not ignore that these workers' economic situations are different than ours and usually much more dire, so talking about what they "want" can't really be divorced from the systems that keep them in relative (and actual) poverty.
In reality, those who work those shifts are often people who don't have much of a choice where to work, much less which hours they're assigned. Sometimes managers will be nice and keep you on a regular shift so you develop a sane sleep schedule -- not usually.
Just like working on holidays, I don't bemoan anyone who wants to eat fast food, or the workers who want to make a little more money. But let's not ignore that these workers' economic situations are different than ours and usually much more dire, so talking about what they "want" can't really be divorced from the systems that keep them in relative (and actual) poverty.
> I get that it's convenient, but working those shifts is miserable (I did it).
Not earning is worse.
Not earning is worse.
I have weird, ever changing sleep schedules and know the feeling you're talking about, but could never survive if my city slept completely. I would go stir crazy, having no where to go and no way to complete daily tasks. In any built up city you're going to have enough people working nights that it makes sense to have at least some night culture that's not centered around partying.
Convenience stores are prolific in Japan. I found travelling in Japan was like travelling on easy mode, because you could do almost everything last minute, including travel and accommodation. There were many days there where I woke up with no plan, half way through the day decided "Ah, this city looks nice", booked my train ticket 10 minutes before it departed and booked my hotel while in transit. Restaurants shut once you arrive? Not a worry, take your pick of a 7/11, Lawsons or Family Mart and get yourself stocked up to enjoy the city properly tomorrow.
Try that in Australia and you'll find yourself in a rental car with no petrol, in the middle of no where with no food!
Try that in Australia and you'll find yourself in a rental car with no petrol, in the middle of no where with no food!
I don't get it, if he doesn't like 7-eleven franchise conditions, why he just doesn't open regular non-franchise convenience store? it's not like they have monopoly, article claims they have 40% of market, so he would join majority of other convenience store owners
Because 7/11 handles all the products and logistics to deliver items multiple times daily. Where would he get things to sell, and how would they get to his store?
Wholesalers. The same way the other 60% of stores get things delivered.
> Government figures show overwork was blamed for 246 claims related to hospitalization or death in 2018. The retail industry was one of the biggest sources, officials show. Another 568 workers took their own lives over job-related exhaustion.
I find it mind blowing, and pretty damning of the culture of shame in Japan that the number of work related suicides is more than double the amount of work related hospitalizations. How doesn't this get more attention?
I find it mind blowing, and pretty damning of the culture of shame in Japan that the number of work related suicides is more than double the amount of work related hospitalizations. How doesn't this get more attention?
Prior to World War II, Japan had massive syndicalist groups and labor unions that caused enough disruption to win universal male enfranchisement. Now, they have “black companies” working people to death with near impunity, while online mobs of right-wingers celebrate their behavior. Quite a horrifying trajectory.
https://en.m.wikipedia.org/wiki/Karoshi
https://en.m.wikipedia.org/wiki/Karoshi
How do you define "universal male enfranchisement“ and how do you prove that claim?
The standard definition? All men over age 25 were provided the legal right to vote. See the link jdale27 provided.
The other side of a culture of extreme duty is a culture of extreme shame. Its not the way for humans to live. We haven't yet seen the end of its self propagation.
Tying this to Japan when 7-11 runs a virtually identical model in Thailand seems weird.
Thailand is a relatively poor country where labor is super easy to find.
Australia is one of the richest countries in the world and our 7 Elevens are 24/7. Along with many other businesses. There's nothing weird here. Have you never been to a city?
As a business owner, I do empathize with him. He wants to be his own boss and make his own hours, but he still needs to keep his commitment or he needs to dissolve it the right way.
As a customer - this would be piss me off so much. There is a 24 hour fitness that I used to go to that closed at 10 pm. HOW IS THAT OKAY?? (this was years ago and still gets me worked up) This is just like that - he wants all the advantages of the franchise but isn't willing to uphold their brand. What's next? He doesn't like the coffee they source because he thinks it is too strong so he waters it down??