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Franchising with the world’s favorite convenience store is easier than you think.

Franchising with the world’s favorite convenience store is ... · Let’s talk franchising. Brand strength: It’s turnkey: Technology: Gross profit split: Faster start-up: Ongoing

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Page 1: Franchising with the world’s favorite convenience store is ... · Let’s talk franchising. Brand strength: It’s turnkey: Technology: Gross profit split: Faster start-up: Ongoing

Franchising with the world’s favorite convenience store iseasier than you think.

Page 2: Franchising with the world’s favorite convenience store is ... · Let’s talk franchising. Brand strength: It’s turnkey: Technology: Gross profit split: Faster start-up: Ongoing

Let’s talk franchising.

Brand strength:

It’s turnkey:

Technology:

Gross profit split:

Faster start-up:

Ongoing support:

Our brand is known and loved around the world, and 7-Eleven is consistently ranked as a top five franchisor.

7-Eleven provides the store, land and equipment, plus extensive training and support from our pros.

We’ve invested millions to provide you with the technology that allows you to keep your shelves stocked with what sells best in your neighborhood.

Rather than sharing royalties on sales, we share profits. This means your success is as important to us as it is to you.

You can be up and running in 3-6 months.

We give you world-class support. We also assist you with many of the day-to-day details, so you can stay focused on what matters most – your customers.

These pages were designed to answer all your questions about franchising

with the world’s #1 convenience store. We know it’s a big decision.

But franchising with 7-Eleven® just might be one of the smartest decisions

you’ll ever make. In a nutshell, here’s why.

Thank you for your interest in exploring a 7-Eleven franchising opportunity.

Please know we will do all we can to help you make the best possible decision.

Page 3: Franchising with the world’s favorite convenience store is ... · Let’s talk franchising. Brand strength: It’s turnkey: Technology: Gross profit split: Faster start-up: Ongoing

A financial big pictureHere are the financial nuts and bolts of

franchising with 7-Eleven. If you still have

questions, remember that you’ll have a chance

to speak with your local Franchise Sales

Representative (FSR) in person. Our FSRs have

all the answers and are prepared to walk you

through every step of the way.

OwnershipTo make this business opportunity possible,

7-Eleven obtains and bears the ongoing cost

of the land, building and store equipment. We

then lease (or sublease) a fully equipped, ready-

to-operate 7-Eleven store, complete with initial

inventory, to you. As a 7-Eleven franchisee, you

will not obtain any ownership interest or equity

in the store site or equipment.

Franchise feeThe initial franchise fee ranges from $50,000 to

$700,000, depending on a number of factors,

including store and location. The current

national average initial franchise fee for a

7-Eleven store is $190,000.

For a list of available stores, visit

Franchise.7-Eleven.com/Available-Store-Locations.

Your local FSR can provide you with specific

franchise fees or additional details on specific stores.

Initial inventory down paymentOne of the benefits of franchising with 7-Eleven

is that the shelves are stocked with the initial

inventory for the store. As the franchisee, you will

then buy the initial inventory from 7-Eleven. The

cost of this purchase is not included in the initial

franchise fee. A fully stocked store generally

has inventory costing about $60,000, but the

actual amount may vary significantly depending

on the store. When you enter into a franchise

agreement, you are required to pay 7-Eleven a

$20,000 down payment on the initial inventory

for the store, and the remaining cost may be

financed by 7-Eleven.

Business licenses, permits, bonds and cash register fundIn addition to the initial franchise fee and

inventory down payment, you pay the cost of all

business licenses, permits and bonds required

by governmental agencies or by 7-Eleven.

The average cost is $6,500. Again, the amount

may vary by store. You are also required to pay

7-Eleven initial funds for the cash register in

order for the store to operate. This amount will

also vary but generally begins at about $1,000.

Here’s what your upfront investment looks like7-Eleven offers opportunities to franchise

a nationally known convenience store for a

moderate investment. Your up-front cost for a

7-Eleven franchise will include:

• Initial franchise fee

• The down payment on the store’s opening inventory

• Supplies

• Business licenses

• Permits

• Bonds

• Cash register fund

This is paid in full to 7-Eleven when you

sign the franchise agreement. The actual

investment may vary significantly depending

on the store. 7-Eleven may provide financing

for a portion of your initial franchise fee.

Page 4: Franchising with the world’s favorite convenience store is ... · Let’s talk franchising. Brand strength: It’s turnkey: Technology: Gross profit split: Faster start-up: Ongoing

A premium saleThere are two types of stores available on

our website. Some are currently operated

by 7-Eleven and others are operated by

franchisees who are interested in selling

their stores (known as Goodwill stores).

In addition to the up-front payment to

7-Eleven, the purchase of a store from a

current 7-Eleven franchisee (a Goodwill sale)

may require an additional payment from

you to the selling franchisee. The amount

of the payment is determined through an

agreement between you and the current

franchisee. If you are offering to buy a

7-Eleven franchise from an existing

franchisee, you must first be approved

by 7-Eleven.

The contractThe term of the 7-Eleven franchise

agreement is 10 years. Renewal and

termination provisions are outlined

in detail in the Franchise Disclosure

Document (FDD).

Ongoing financing7-Eleven will provide an open account

or financing to qualified franchisees for

the inventory and operating expenses of

the store. The amount financed generally

fluctuates from month to month based

on sales, inventory, purchases, operating

expenses and withdrawals from a store’s

open account. The annual interest rate is

generally two points over the prime rate

as noted in the FDD.

Ongoing feesWhen you franchise with 7-Eleven, both

you and 7-Eleven have a stake in the

store’s profitability. Rather than taking a

percentage of total monthly sales receipts,

you pay a percentage of the store’s gross

profits to 7-Eleven as compensation

for the license of the service mark and

system, the lease of the facilities and

certain ongoing services. Details on the

gross profit split are outlined in the FDD.

=GROSS PROFIT

7-Eleven pays for: • Property & building rent or

acquisition cost

• Equipment purchase or rent

• Certain property taxes

• Some utilities (electric/gas/water/sewer)

• Building maintenance

• Equipment replacement expenses

• 7-Eleven advertising

• Contracted indemnification

• Initial and ongoing training programs and written or online material on any/all store operations

• Bookkeeping and back office support

• Financial summary reports

• Inventory audits

• Product development and merchandising assistance

• Ongoing business advisory assistance

• Local and national level franchisee advisory councils

Franchisee pays for:• Payroll and payroll taxes

• Workers’ compensation and employee group insurance

• Business taxes and licenses

• Cash and inventory shortage

• Store supplies and all miscellaneous store expenses

• Equipment maintenance and overall general repairs

• Outside property maintenance and landscaping

• Telephone service

• Janitorial and laundry services

• Security expenses

• National advertising fee and local store advertising expenses

• Interest expenses

• Other operating expenses

Page 5: Franchising with the world’s favorite convenience store is ... · Let’s talk franchising. Brand strength: It’s turnkey: Technology: Gross profit split: Faster start-up: Ongoing

The road to your very own 7-Eleven franchiseApply

• Apply online at Franchise.7-Eleven.com/Apply-Now

• Your application and credit report will be reviewed by a Franchise Recruiter (minimum credit requirements apply)

• If applicable, an initial discussion will be scheduled with a Franchise Recruiter for a chance to learn more and discuss the process

Business Leadership Inventory (BLI) assessment• BLI is a non-proctored assessment that determines your leadership skills

• The BLI is by email invitation only, and administered online

Your second meeting• Complete a structured discussion with an FSR

• Select a store and review financial information as well as initial investment fees

• Discuss selected store details with an FSR

Franchise agreement is offered and signed

Your first meeting: Business Acumen Evaluation (BAE)

• The BAE is a proctored assessment that indicates how well you understand business

• The test is given in an office environment by appointment

Background check• Your background check and funds are verified

Training• Fly to Dallas, TX for a weeklong Launch Class that

introduces you to the 7-Eleven brand

• Back to your communty for 4-6 weeks of in-store, computer based C.O.O.L. (College of Operations Leadership) training Change Over

(Grand opening)

Final discussion with 7-Eleven’s management team

Open disclosure• The Franchise Disclosure Document (FDD) is sent electronically

• Here’s your opportunity to learn about the 7-Eleven, Inc. franchise model

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Page 6: Franchising with the world’s favorite convenience store is ... · Let’s talk franchising. Brand strength: It’s turnkey: Technology: Gross profit split: Faster start-up: Ongoing

Basic requirementsIf you’re interested in franchising with 7-Eleven,

take a look at our basic franchisee requirements.

If you have questions, your designated FSR

will explain the details at any point during your

application process.

A single-store franchisee must:• Have US citizenship (or permanent residency)

and be at least 21 years old

• Live near selected store

• Be able to obtain/maintain all licenses necessary for the store operation

• Read, write and speak English proficiently

• Pass a comprehensive background check

• Have excellent credit

• Complete all steps in the application process and 7-Eleven’s current store training

• Have no prior record of misdemeanor or felony convictions

• Understand the need to be involved in the day-to-day operation of the store

• Have realistic financial expectations and understand and accept the business risk associated with franchising

• Demonstrate the willingness and ability to work within the 7-Eleven franchise system

Incorporation guidelines: Up to four individuals

can be owners in the purchase of the store. All

four must complete individual applications,

be approved for a franchise and successfully

complete training. All must be involved in the

day-to-day operation of the business and own a

minimum percentage of the corporation.

A multi-unit franchisee must:• Meet all single-store franchisee basic

requirements

• Identify a designee for every store of interest who will need to attend and successfully complete the training program along with you

• Have a background that supports managing a 7-Eleven store (retail & management experience)

• Not have any other business interest that, in the opinion of 7-Eleven, might jeopardize their opportunity to successfully implement the 7-Eleven business concept

Incorporation guidelines: Up to four individuals

can be owners in the purchase of the store. All

must own at least 20% of the business. At least

two owners must successfully complete training.

All owners must assign a principal managing

director. This individual will complete training

and be involved in the day-to-day operation.

Page 7: Franchising with the world’s favorite convenience store is ... · Let’s talk franchising. Brand strength: It’s turnkey: Technology: Gross profit split: Faster start-up: Ongoing

Work experienceHere’s an overview of our experience guidelines.

Once again, if you have questions, your FSR can

discuss these requirements in detail at any point

during your application process.

A single-store franchisee must:• Have retail or operations experience

• Have management/leadership experience

• Show a stable employment history and be able to provide good work and/or business references

• Exhibit a passion for excellent customer service and understand the importance of community involvement

• Exhibit good organizational skills

• Demonstrate a thorough understanding of computer operations/benefits and the ability to quickly learn and teach emerging technologies focused on improving the guest experience

• Be able to analyze data and make decisions based on information collected (trends, sales, etc.)

• Exhibit an understanding of the product assortment concept

• Demonstrate a solid understanding of the impact of image to overall sales and profit improvement (including store conditions as well as employee appearance)

• Food service experience is beneficial, but not required

A multi-unit franchisee must:• Meet all single-store franchisee experience

requirements

• Have multi-unit management experience (5 to 10 years)

• Hold past business ownership experience (multi-unit ownership and/or franchise business ownership preferred)

Financial requirementsFinancial requirements are the same for both our

single-store and multi-unit franchisees. If you have

questions, feel free to discuss them with your

designated FSR during your application process.

A single-store & multi-unit franchisee must:

• Provide required documents for financial review

• Be able to show that all assets identified for the investment are in the U.S. and verifiable by 7-Eleven

• Have 100% of the investment plus three months of living expenses (contingency funds) available from sources acceptable to 7-Eleven at the time the agreement is signed and before attending training

• Have 7-Eleven approve (in advance) all incorporations

Page 8: Franchising with the world’s favorite convenience store is ... · Let’s talk franchising. Brand strength: It’s turnkey: Technology: Gross profit split: Faster start-up: Ongoing

Thanks for taking the time to learn more about franchising with 7-Eleven. If you think you’ve

got what it takes, go ahead and take the next step. Visit Franchise.7-Eleven.com and fill out a

franchising application today. It really is that easy, and it just may change your future – and your life.

© 2014 7-Eleven, Inc. This is not an offer to sell a franchise. An offer can only be made in applicable states with authorized documentation. 7-Eleven Inc., One Arts Plaza, 1722 Routh St., Suite 1000, Dallas, Texas 75201

Let’s keep the conversation going.