7-Eleven to ramp up e-commerce platform

KUALA LUMPUR: 7-Eleven Malaysia Sdn Bhd is planning to push its e-commerce platform to become even more convenient to consumers, as part of its strategy to maintain market leadership in the convenience store industry.
"We're going to ramp up our e-commerce platform whereby you'll be able to buy online and pay in 7-Eleven for your shopping because there are a lot of people who don't trust necessarily payments online but they want to buy online," its CEO Gary Brown (pix) told SunBiz in an interview recently.
He said the platform already exists and the service is already available with a number of merchants but the company is in the midst of adding more merchants and planning an expanded marketing campaign that will highlight the merchants.
"It is very appealing to people who prefer not to pay online, people who don't have credit and foreign workers who don't have access to credit. There's a huge customer base that we can provide that service to.
"It's available but we didn't push it earlier because we've been taking time to fully integrate it into our system. We've got merchants signed up," he added.
Besides the e-commerce platform, 7-Eleven will continue bringing in more products into its stores, especially fresh food and beverages, introduce more utilities for bill payment service and continue with promotional activities that are tied-in with themes and festive seasons.
"Last year, we introduced a lot of new products particularly in the area of fresh food and beverage. We've also introduced a lot of new services. Now you can top up Touch n Go in our stores, you can also do bill payment for Telekom, Astro, U Mobile, so it's fantastic to be able to do those in the store 24/7 compared with only eight hours a day at the post office. It's been a really positive shift for us. We are also the first retailer to launch prepaid gift cards that are really popular in other parts of the world," said Brown.
The company also carried out many promotions last year, which was part of its strategy to create a better environment for shoppers by making it more interesting and exciting to shop at 7-Eleven stores.
"So when you get the services, the promotions and also our new range of food and beverage, we become a total convenience store. Which is what we are. We're becoming more and more convenient to the customer. That's what our strategy is and direction moving forward and we're well on track to doing that. Clearly our results would suggest that the consumer is accepting the new strategy and is very positive in the way they are reacting to 7-Eleven," he said.
For 2015, the company plans to open 200 new stores and continue refurbishing 200 stores per year. At press time, 7-Eleven had over 1,800 stores across the country. Each new store costs between RM260,000 and RM300,000, which is capital for renovation, equipment and fixtures.
"We will still grow very strongly in the Klang Valley but we see good opportunities in East Malaysia, East Coast and key cities like Penang and Johor Baru. Then we see good opportunities in shopping malls, in education facilities, transport hubs," he said.
Brown said the capital expenditure remains as announced in its prospectus, that is RM85 million for new stores and refurbishments in 2015. Its IT and warehousing projects are also on track as outlined in its prospectus.
"We're trying to make our network a bit like some of the other countries. When you go to Thailand there's a 7-Eleven everywhere, in Taiwan as well, and we see an opportunity for that type of expansion, most definitely," he said, adding that all these measures will help the company maintain its market share of about 82% in the standalone convenience store industry.
On the Goods and Services Tax (GST) which was implemented on April 1, Brown said 7-Eleven will be less affected despite the uncertainty surrounding GST and its implications.
“We’re less impacted by GST because people come to us for impulse purchase, for food and beverage on the go and others. We’re not selling a carton of drinks, we’re selling one drink or two drinks. So the impact of GST is relatively minimal.
“GST will not impact us tremendously but if consumer sentiment remains low then we’ll be impacted to some extent because we compete in the same market place. But otherwise, I’m looking forward to strong growth in both sales and profit for the year as we continue to expand,” he said.
The company also does not foresee any big impact from the weakening currency as it mainly deals with local manufacturers and suppliers, with less than 5% of its stocks being imported.