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In the past 7-Eleven was unique in the franchise world where you could make a comfortable living owning a single store and that was the major ownership model. M

by bradly 16d ago

In the past 7-Eleven was unique in the franchise world where you could make a comfortable living owning a single store and that was the major ownership model. McDonalds and other options at the time really depended on a multi-store ownership model. Corporate 7-Eleven (Southland Corp technically) moved away from this single store model in the mid to late 90's, instead preferring single, larger corporations in a region, owning 10+ stores over a single store owner. They made this happen over a 20 year span by changing the contracts franchisees sign and must to re-sign every x years. Every contract renewal drastically reduced the single store income and made it much harder for single store owners to make a living. Corporate also started preferring to give new stores to existing, large scale franchises over new store owners which changes the initial capital needed for a store by over 10x as with an existing store you will have to pay the rights from the previous franchisee instead of just the corporate. My parents, grandparents, aunts and uncles all own or have owned 7-Eleven stores and have since the 80's. I've worked there, been to their conferences, and still get to hear about them at all family gatherings :)

JackFr 16d ago
I don't know if it's causative, but that seems to coincide with the move from Southland Corp to being run by the Japanese parent Seven & i Holdings.
SoftTalker 16d ago
McDonalds was the same early on, but evolved into a real-estate operation that also sells hamburgers. Last I knew (this was the 1990s) there were still a few single-store franchisees but most franchisees owned at least half a dozen stores in a market. I also think the investment required to buy a franchise is vastly larger than it was in the beginning. It's really only affordable to owners who can leverage the income they are making from the stores they already own. AFAIK they do still require owners to be operators. You can't own a McDonalds franchise passively. But I'm not sure that's still the case.
- greedo 16d ago
  Back in the 80's you still needed to have multiple stores. Otherwise your overhead from back office and maintenance stuff would just eat up too much profits. Once you hit three stores, you could start to make serious money if you ran a tight ship.

by bradly 16d ago

JackFr 16d ago

I don't know if it's causative, but that seems to coincide with the move from Southland Corp to being run by the Japanese parent Seven & i Holdings.

SoftTalker 16d ago

McDonalds was the same early on, but evolved into a real-estate operation that also sells hamburgers. Last I knew (this was the 1990s) there were still a few single-store franchisees but most franchisees owned at least half a dozen stores in a market. I also think the investment required to buy a franchise is vastly larger than it was in the beginning. It's really only affordable to owners who can leverage the income they are making from the stores they already own. AFAIK they do still require owners to be operators. You can't own a McDonalds franchise passively. But I'm not sure that's still the case.

greedo 16d ago
Back in the 80's you still needed to have multiple stores. Otherwise your overhead from back office and maintenance stuff would just eat up too much profits. Once you hit three stores, you could start to make serious money if you ran a tight ship.