7-Eleven Japan Experience first sales decline in a decade
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Japanese convenience-store chain 7-Eleven has suffered its first year-on-year downturn in more than nine years.
The decline in monthly sales throughout the chain has been attributed to heavy rains and the hack of its doomed 7Pay e-payment platform last month, which prompted customers to use rival services.
Sales chainwide dropped 1.2 percent last month, with a 5.6-per-cent decline in same-store customer traffic. The inclement weather has also affected sales of particular items such as drinks and ice cream.
7-Eleven’s same-store sales receded 3.4 percent this month, while the number of franchises grew 2.7 percent² to 20,990 stores.
7-Eleven has discontinued its 7Pay service following a security breach that prompted the firm to stop the app from charging linked cards and put a block on new registrations.
The firm has also been struggling with its 24-hour service model, with some franchisees growing increasingly uncomfortable with rising labor costs involved with round-the-clock opening hours.
Questions & Answers
Q.What factors contributed to 7-Eleven Japan's sales decline?
What factors contributed to 7-Eleven Japan's sales decline?
Heavy rains and the security hack of its 7Pay e-payment platform are cited as reasons. These issues prompted customers to use competitor services and affected sales of specific items.
Q.How significantly did sales and customer traffic decrease last month?
How significantly did sales and customer traffic decrease last month?
Chainwide sales dropped by 1.2 percent last month. The company also experienced a 5.6 percent decline in same-store customer traffic during the same period.
Q.Why did 7-Eleven discontinue its 7Pay e-payment service?
Why did 7-Eleven discontinue its 7Pay e-payment service?
The 7Pay service was discontinued due to a security breach. This incident led the firm to stop the app from charging linked cards and prevent new customer registrations.
Q.What other challenge is 7-Eleven Japan currently facing?
What other challenge is 7-Eleven Japan currently facing?
The company is struggling with its 24-hour service model. Some franchisees are becoming uncomfortable with the rising labour costs associated with maintaining round-the-clock opening hours.
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