How Big Is Gas for 7-Eleven? a Huge Resource Following Recent Acquisitions

March/April 2017 T H E V O ICE OF 7-ELEVEN FRANCHISEES How Big Is Gas For 7-Eleven? A Huge Resource Following Recent Acquisitions

Territory Rights And Encroachment The Three- Legged Stool What Business Is Legged Stool Your Franchisor In? The App Industry– Is It for Us? Vixxo Maintenance Dispelling Some Price ETA Myths Increase Getting The ‘Basics’ Right Intere$ted In $aving Money? 2017 Register for the 2017 NCASEF AFFILIATE MEMBERS www.ncasef.com Convention Page 57

July 17–20 Register Now at www.ncasef.com Page 81

8 AVANTI MARCH | APRIL 2017 MARCH | APRIL 2017 AVANTI 9 10 AVANTI MARCH | APRIL 2017 MARCH | APRIL 2017 AVANTI 11 MARCH | APRIL 2017 AVANTI 13 T H E V O I C E O F 7 -ELEVEN FRANCHISEES March/April 2017 Contents Features 31 Territory Rights And 55 Getting The ‘Basics’ Right Join Us For The National Coalition’s By Greg Addison, Sr. Vice President, Double Down Big Car Giveaway! Encroachment The Lewer Companies By Joe Galea, Chairman, NCASEF 78 Intere$ted In $aving Money 35 What Business Is Your On Your Expen$e Line? Franchisor In? By Bill Huffman, Vice President, By Eric H. Karp, Esq., Greater Oregon FOA, Co-Chair, NBLC General Counsel, NCASEF 26 A Festive Night At UFOLINY Holiday Party July 17–20 41 The Three- 24 Central Texas FOA Supports Austin Register Now at Legged Stool Police Event www.ncasef.com By Romy Singh, Vice Chairman, NCASEF, 72 Midwest FOA Page 81 President, Eastern Virginia FOA Donates Funds To AFFILIATE 43 Vixxo Maintenance Price Chicago Police 2017MEMBERS Increase—The Update Federation Page 57 By Rehan Hashmi, Vice Chairman, Vice President Alliance for 7-Eleven Franchisees Member News...... 16 45 The App Industry—Is It for Us? 7-Eleven Acquires Sunoco Stores, Seven & I’s Restructuring, DePinto Elected To Hall, Record Sales Highs, 7-Eleven #1, Most 'Mobile-Ready' Brands, Walmart Tech By Nick Bhullar, Vice Chairman, NCASEF Incubator, Dollar General Buys Dollar Express, Wawa South Florida, Amazon Grocery DEPARTMENTSPickup, Gas Stations Food Quality, Verifone , Supermarket Delivery, Philadelphia Tax Reduces Sales, Dollar General Expands Produce, Couche-Tard’s Finances, Target Convenience, Gas Stations Disappearing, Automated C-Store, Millennial Snacking, Eating More Snacks, Grocery Online, Key Grocery Trends, Mobile Ordering, Seasonal Ingredients

49 Dispelling Some ETA Myths Legislative Update...... 20 Florida Lawmaker Protects Franchisees, Mayor Vetoes Wage Hike, Credit Card Accord, By Pete Gragnano, President, NY Surcharge Ban, NY Lottery Commission, PA Hard Liquor Bill, Kansas Stronger Beer, Suburban Washington FOA California Gas Tax, WV Tobacco & Soft Drink Taxes, C-Stores & Lawmakers Clash, Conn & NC Tobacco Age

Membership Offer FOR SEI News...... 90 FRANCHISEES Page 76 Women's Franchise Competition, Texas 7-Elevens Powered By Wind, Single-Origin Coffee, Orlando City Youth Soccer, AVANTI is published by the National Coalition of Associations of 7-Eleven InComm ‘Vendor Of The Year’, Riskonnect, Exclusive Trolli Franchisees for all independent franchisees, corporate store managers and Slurpee Flavor, Slurpee ‘Twin-sies’, Mexico Deploys Oracle interested parties. National Coalition offices are located at 740 Front Street, Suite 170, Santa Cruz, CA 95060. For membership information, call 831- Bits & Pieces...... 18 426-4711 or e-mail [email protected]. AVANTI Offices are located at 116 Bellevue Ave., Suite 304, Langhorne, Pennsylvania 19047. For ad- Vendor Focus...... 95 vertising information, call Sheldon Smith at 215 750-0178 or fax to 215 750-0399; on-line, send messages to [email protected]. Franchisee Calendars...... 102

14 AVANTI MARCH | APRIL 2017 MARCH | APRIL 2017 AVANTI 15 NATIONAL COALITION OF ASSOCIATIONS OF 7-ELEVEN FRANCHISEES NATIONAL OFFICERS Joseph Galea NATIONAL CHAIRMAN “It also provides 7-Eleven entry into 831-426-4711 • [email protected] The Big News: 7-Eleven Houston, the fourth largest city in the Jatinder Singh United States, and a strong presence in EXECUTIVE VICE CHAIRMAN Acquires Sunoco C-Stores Corpus Christi and across South Texas.” 702-249-3301 • [email protected] SEI recently announced it has en- As part of the transaction, Sunoco Eric H. Karp, Esq. tered into an asset purchase agreement announced that it will enter into a 15- GENERAL COUNSEL with Sunoco LP to acquire approximately year take-or-pay fuel supply agreement 617-423-7250 • [email protected] 1,108 convenience stores lo- with a 7-Eleven subsidiary under which Nick Bhullar cated in 18 states. Sunoco will supply approximately 2.2 bil- VICE CHAIRMAN 626-255-8555 • [email protected] SEI presently lion gallons of fuel annually. This supply has 8,707 stores agreement will have guaranteed annual Rehan Hashmi in the United States VICE CHAIRMAN payments to Sunoco, provides that 7- 847-845-8477 • [email protected] and Canada. This Eleven will continue to use the Sunoco Romy Singh acquisition will be one of the largest in brand at currently branded Sunoco stores VICE CHAIRMAN the company’s history, and will bring and includes committed growth in future 757-506-5926 • [email protected] SEI's total number of stores to 9,815 in continued on page 18 the U.S. and Canada. Michael Jorgenson TREASURER “This acquisition supports 347-251-1828 • [email protected] our growth strategy in key geo- “Aer the purchase of 1,108 CONVENTION CHAIRPERSON graphic areas including Florida, Sunoco Convenience stores, 520-577-8711 [email protected] mid-Atlantic states, Northeast approximately 44 percent of all John Riggio states, and Central Texas,” said SEI MEETING/TRADE SHOW COORDINATOR President and CEO Joe DePinto. 7-Eleven stores will sell gas.” 262-275-3086 • [email protected] Sheldon Smith AVANTI PUBLISHER ADVERTISING MANAGER Get Avanti 215-750-0178 • [email protected] Online! The National Coalition is proud to announce that vendors and franchisees Sheldon Smith PUBLISHER&ADVERTISING SALES can now read AVANTI, the digital ver- 215 750-0178 sion, online at Issuu.com before you [email protected] receive the printed copy! To join the John Santiago ASSISTANT EDITOR AVANTI distribution list and receive 215 750-0178 a link to the latest issue as soon as [email protected] it is uploaded, send an e-mail to Tricia Kessler GRAPHIC DESIGN [email protected] with the KESSLER DIGITAL DESIGN subject field “AVANTI ONLINE” and you will receive an email alert as soon as the digital magazine is The Voice of 7-Eleven Franchisees posted. Feel free to include your U.S. postal address in the e-mail if you March/April 2017 ©2017 National Coalition of would also like to be placed on our AVANTI mailing list. AVANTI is also Associations of 7-Eleven Franchisees Avanti Magazine is the registered available on the NCASEF website in pdf format at www.NCASEF.com. trademark of The National Coalition of Associations of 7-Eleven Franchisees.

16 AVANTI MARCH | APRIL 2017 SEPTEMBER | OCTOBER 2016 AVANTI 17 Register for the 2017 NCASEF Convention www.ncasef.com continued from page 16 periods, the gas company said in a released statement. Seven & I’s All told, after the Sunoco 1,108 store purchase, approximately 44 per- Restructuring Plan cent of all 7-Eleven stores will have gas SEI parent com- compared to only one quarter of all pany Seven & I stores just four years ago. Holdings is breaking A new study by PriceAdvantage reveals that its convenience store 30 percent of fuel retailers utilize day-part operations into two fuel pricing, or scheduled price changes dur- DePinto Elected segments in order to ing set windows of time throughout the To CSNews Hall of Fame strengthen its overall c-store growth, re- day/week, in order to maximize margins and ported CSP Daily News. While also re- volume. • Anheuser-Busch InBev has commit- SEI President and ted to secure all of its purchased electricity structuring its seven operational CEO Joe DePinto was re- from renewable sources by 2025, reported segments—which include superstore cently selected as one of CNBC. The company said its decision to go big operations and department store oper- this year’s inductees into on renewable energy would cut its operational ations—the company will spilt its c- the Convenience Store carbon footprint by 30 percent, equivalent to store operations into domestic News Hall of Fame, re- taking almost 500,000 cars off the road. • convenience store operations and over- Google is now the world’s most valuable ported CSNews Online. DePinto, along seas convenience store operations. The brand with a value of $109 billion, according with Blake Benefiel (director of trade and domestic unit will control c-store inter- to the Brand Finance US 500 ranking. The state relations for Altria Group Distribu- ests in Japan as well as in China and total value of America’s top 500 brands now tion Co.), will be honored at a gala ban- Hawaii, while the overseas unit will exceeds $3 trillion dollars, having increased quet and induction ceremony this fall in control SEI in the United States and its 11 percent from $2.82 trillion in 2016 to $3.14 Dallas. According to the article, DePinto c-store interests in other countries, the trillion this year. • 7-Eleven Hawaii plans to will become the third executive from 7- open a second location in Downtown Hon- article states. Eleven to be inducted into the Conven- olulu later this year, reported Pacific Business When the restructure is complete in ience Store News Hall of Fame, following News. With more than 60 stores in Hawaii, the early 2018, SEI will focus on a growth strat- founding brothers John and Jere Thomp- company is also opening a new store in Cen- egy that includes acquisitions and contin- son, who were inducted together in 1991, tral Oahu in the second quarter. • Wawa re- ued organic store growth, and will also and former CEO James Keyes, who en- cently launched a three-month long spring boost its prepared foods offering by making hiring campaign to fill more than 5,000 full- tered the Hall of Fame in 2005. Hall of quality and service improvements. Joining time and part-time customer service and Famers are selected by a 60-member blue SEI in the new international unit will be SEJ management positions across the company’s ribbon panel of top convenience store re- Asset Management & Investment Co., 750 stores. In addition, some Wawa stores are tail executives, as well as past retailer and continued on page 20 hosting Wawa Career Wednesdays. • A recent supplier Hall of Fame inductees. Harris Poll shows 1 in 4 adults have purchased a meal kit in 2016 (25 percent) and 70 percent of meal kit purchasers are still actively purchasing meal kits. • West Viriginia DMV The National Coalition Office customers can now renew vehicle registra- The strength of an independent trade association lies tions at “WV DMV Now” kiosks located in in its ability to promote, protect and advance the best Sheetz c-stores in Beckley and Star City. • New interests of its members, something no single member 740 Front Street, Suite 170 research by the Cannabiz Consumer Group or advisory group can achieve. The independent trade Santa Cruz, CA 95060 (C2G) finds that legal marijuana will take away 7.1 percent of revenues from the existing association can create a better understanding between Office 831-426-4711 retail beer industry. If cannabis were legal- its members and those with whom it deals. National Fax 831-426-4713 ized nationally, the beer industry would lose Coalition offices are located in Santa Cruz, California. E-mail: [email protected] continued on page 38

18 AVANTI MARCH | APRIL 2017 Register for the 2017 NCASEF Convention www.ncasef.com continued from page 18

drove spending inside the store. Here’s which Seven & I established in “C-stores in 2016 experienced how in-store sales performed in 2016: 2012 to support the business • Tobacco (cigarettes and OTP): 36 per- expansion initiatives of 7- record in-store sales, but fuel mar- cent of in-store sales Eleven in the United States. gins in 2016 dropped to 23.1 cents • Foodservice (prepared and commissary compared with 23.4 cents in 2015.” food; hot, cold and dispensed beverages): In-Store Sales 21.7 percent ranked by sales dollars represent about 80 • Packaged beverages (carbonated soft Reach Record Highs percent of all in-store sales, the report drinks, energy drinks, sports drinks, U.S. convenience stores experienced states. In 2016, eight of the 10 top in-store water, juices and teas): 15 percent record in-store sales of $233.0 billion in categories saw positive sales, including • Center of the store (salty, candy, pack- 2016—and the third straight year of $10 cigarettes, and nine had positive gross aged sweet snacks and alternative billion-plus in pretax profits—according profit dollar growth. Factors such as low snacks): 9.8 percent to newly released NACS State of the In- fuel prices, job growth and more discre- • Beer: 6.7 percent (12.2% for stores sell- dustry data. The top 10 in-store categories tionary income in consumers’ wallets ing beer) continued on page 24 Legislative Update Florida Lawmaker Seeks To Protect Franchisees ing cities and suburban counties, Mayor Catherine Pugh said. Maryland has al- Legislation to protect owners of franchise systems like Mc- ready mandated a minimum wage increase to Donalds and 7-Eleven was recently introduced in the Florida $9.25 an hour in July and to $10.10 in 2018. House, reported StPetersBlog.com. Sponsored by Sanford Re- The City Council voted 11-3 in late publican Jason Brodeur, HB 1069 would prohibit a franchiser March to approve the increase, with one from refusing to renew a franchise unless specific criteria have supporter of the measure absent. Lawmakers been met. A group of 7-Eleven franchise owners made their case need 12 votes to pass it over Pugh's veto. Even so, for such a bill at a Pasco County Legislative Delegation in Janu- the legislation's sponsor, Councilwoman Mary Pat Clarke, said ary, calling for legislation to protect them from having their busi- she was not confident that fellow lawmakers would be able to nesses ripped out from underneath them by their corporate override the veto. The vetoed measure would raise the minimum owners. “We work tirelessly. We are continuing to grow the local wage to $15 an hour by 2022 for businesses with 50 or more em- economy, paying local and state and payroll taxes,” 7-Eleven ployees and by 2026 for businesses with fewer than 50 workers. franchisee Arnie Tange told StPetersBlog.com. “However, be- Supreme Court Will Not Reinstate cause of the lack of protection laws for small businesses, we can Credit Card Accord lose our small businesses if our franchiser—who’s based in another state—decided not to renew or extend my agreement to The U.S. Supreme Court recently refused to revive a $5.7 operate under their brand name.” billion settlement of retailer claims that Visa and MasterCard Baltimore Mayor Vetoes improperly fixed credit-card swipe fees, in a rebuff that could Minimum Wage Hike mean years of additional litigation, reported Bloomberg. Reject- “Baltimore’s ing calls from the card companies and the settling retailers, the Mayor will veto a Baltimore's mayor recently said she justices left intact a ruling that scrapped the accord and said it would veto legislation that would nearly didn’t adequately protect the interests of objecting merchants. measure to raise double the Maryland city's minimum wage The world’s biggest payment networks had sought to end a the minimum to $15 an hour, reported Reuters. The leg- decade-old court battle over fees that exceed $40 billion annu- wage to $15 per islation raising the minimum wage from ally. Dozens of big retailers—including Amazon.com Inc., Target hour by 2022.” $8.75 an hour would have put the city at a Corp. and Starbucks Corp.—opposed the settlement and urged competitive disadvantage with neighbor- continued on page 64

20 AVANTI MARCH | APRIL 2017 22 AVANTI MARCH | APRIL 2017 MARCH | APRIL 2017 AVANTI 23 Register for the 2017 NCASEF www.ncasef.com continued from page 20 Convention

• Other: 10.8 percent “While digital brands C-stores throughout the country re- 7-Eleven Ranked Among ported a 9.2 percent decline in fuel sales. Facebook and Amazon This was driven by another year of low gas Most 'Mobile-Ready' Brands ranked No. 1 and No. 2, prices, which averaged $2.17 for the year 7-Eleven is the top non-digital com- compared with $2.44 in 2015. Fuel sales pany to make it onto mobile marketing 7-Eleven ranked third on volume was up 2.6 percent, riding the wave and technology agency Ansible’s ranking a top 10 list of mobile- of continued economic recovery. Mean- of the most “mobile-ready” brands, re- while, fuel margins in 2016 dropped to 23.1 ported Mobile Marketing Daily. While ready brands.” digital endemic brands Facebook and cents compared with 23.4 cents in 2015, non-digital brands. The premise behind Amazon rank No. 1 and No. 2, respec- but due to increased sales volume overall this global study is to examine how tively, 7-Eleven ranked third on a top 10 fuel gross profit increased 1.6 percent per brands have and continue to adapt to the list that was split between digital and store per month. rapid shift in consumer engagement and behavior. According to MAGNA, in Central Texas 2016 consumers dedicated 33 percent of FOA Supports their time to mobile devices, compared with 25 percent to Live TV. By 2021, Austin Police MAGNA projects that consumers will Event raise their mobile consumption to 37 percent, with Live TV consumption de- On March 25, members of creasing to 22 percent. the Central Texas FOA set up camp at Roy G. Guerrero River Park in Austin to help support the Police Department’s annual Dollar General Buys Public Safety Event and Elemen- 323 Dollar Express Stores tary Schools Youth Soccer Tour- nament. Franchisees handed out free beverages, food and snacks to all attendees throughout the day, and the FOA was thanked and honored with medallions presented by Austin Mayor Steve Adler and the Austin Police Department for the group’s participation. Dollar General recently acquired The Central 323 Dollar Express stores from private Texas FOA extends equity firm Sycamore Partners, which a special thanks to purchased the stores in the Dollar Tree- its franchisees and Family Dollar merger two years ago, re- Board members ported RetailDive.com. Dollar Express who contributed emerged in 2015 when Dollar Tree di- vested some 330 stores in 35 states in order to assuage Federal Trade Com- in every way possible to help continued on page 26 make this event a success. The association also thanks “Dollar General reported Market Manager Ricardo Clement, Zone Merchandiser fourth quarter net sales Yogesh Takhar and Fresh increases of 13.7 percent Food Category Manager Justin Whittaker for all their to $6 billion, compared to support. $5.3 billion a year ago.”

24 AVANTI MARCH | APRIL 2017 Register for the 2017 NCASEF

continued from page 24 Convention www.ncasef.com mission antitrust concerns related to fiscal year same-store sales increased Spring 2017. Other Dollar Tree's $8.5 acquisition of rival 0.9 percent. stores are in vari- Family Dollar. Sycamore was going to ous stages of devel- rebrand the stores as Dollar Express lo- opment in Fort Lauderdale, Davie, cations, but they will become Dollar Wawa Enters South Florida Parkland, Sunrise, and Greenacres. At a General stores under the new deal. Pennsylvania-based convenience groundbreaking ceremony for the West In March, Dollar General reported store chain Wawa opened its first three Palm Beach store last year, Wawa pres- fourth quarter net sales increases of South Florida stores on a single day— ident and CEO Chris Gheysens said the 13.7 percent to $6 billion, compared to March 23, reported the Sun Sentinel. company wants to open 50 locations in $5.3 billion in the year-ago quarter, The company presently has four Palm South Florida over the next five years. with same-store sales rising 1 percent. Beach County stores listed as opening in The South Florida expansions fol- Dollar Gen- low years of Wawa development in the eral's fiscal northern and western sections of the year net sales “Wawa in November commemorated the grand state. In November, the company com- rose 7.9 per- opening of its 100th Florida store by giving away memorated the grand opening of its cent to $22 free coﬀee, any size, at all of its Florida locations.” 100th Florida store, in Brandon, by giv- billion, and continued on page 28

A FESTIVE NIGHT AT UFOLINY HOLIDAY PARTY Members of the UFOLINY FOA closed out 2016 with good cheer and camaraderie during their Annual Holiday Party, held at the Crest Hol- low Country Club on De- cember 5. The group enjoyed a night of great food, music and entertainment as they celebrated another successful year with family, friends and colleagues.

26 AVANTI MARCH | APRIL 2017 MARCH | APRIL 2017 AVANTI 27 Register for the 2017 NCASEF Convention www.ncasef.com continued from page 26 ing away free coffee, any size, at all of its dering and pickup, free to its Prime where employees will load groceries Florida stores. In business since 1964, the members, reported Supermarket News. into their cars “within minutes.” company enjoys a cult following in The sites, located in Seattle’s Sodo and Florida among transplanted northerners Ballard neighborhoods, are currently familiar with the company's custom- open only to Amazon employees in a 7-Eleven #1 On made salads and sandwiches, fresh- beta test. The service allows shoppers to Top 202 C-Store List baked cookies, free wifi, and reputation shop online and select a delivery time, 7-Eleven has garnered the #1 spot on for friendly service. with orders ready in as little as 15 min- CSP’s Top 202 Convenience Stores list, utes. Customers can pull in to any of which ranks c-store chains based on store several drive-up spaces at the store Amazon Unveils Its count and other metrics. 7-Eleven came in with 8,303 stores—up from 8,273 on Grocery Pickup Stores last year’s ranking, while Couche- Amazon recently revealed details of Tard/Circle K ranked #2 with 7,232 stores, its grocery click-and-collect sites in and Speedway a distant third with 2,770 Seattle, saying the offering—to be stores. CSP noted that 7-Eleven has sev- branded AmazonFresh Pickup—would eral competitive advantages: its Retailer provide a full array of grocery and Initiative allows an operator to align prod- household items available for online or- continued on page 64 BY JOE GALEA, EXECUTIVE CHAIRMAN, NCASEF

SEI has stated and demonstrated it ing franchisees to become multiple “One way we are trying to is on a growth path in Canada and the store owners. This opportunity is im- United States by continuing to make portant, because it allows us to avoid differentiate ourselves from the store acquisitions that add to overall encroachment by purchasing the new competition these days is by our store totals. The company is presently store that may be very close to one we near its goal of 10,000 locations in North already own. This offers a sense of se- product selection. The other is AmericaTerritory with its recent purchase Rights of curity and comfort that your invest- by growing our store count.” 1,108 Sunoco c-stores (with gas), which ments in the system are going to be safe brings its total number to 9,815 in the because you won’t be competing U.S. andAnd Canada. While Encroachment this expansion against another franchisee so close to the opportunity to decide if they would offers an opportunity to grow within the your store. like that location. A lot of times we find 7-Eleven system, many storeowners out after the fact, and then the fran- question if an encroachment amend- chisee is at a disadvantage. ment to our contract is truly necessary When that happens, it creates a to protect our investments. Franchisees negative feeling within the system that are also asking why aren’t we being given franchisees are being left out of the first crack at owning a new location process when we should be totally in- coming up in our area? volved because we already have an in- As I give it some thought and look vestment in the system. It would create around my area, I see competition is all a positive feeling if the franchisees were around us. It is from retailers that have notified and allowed to make the deter- not competed with us in the past—dollar mination if they want that location or stores, pharmacy chains, fast food restau- not. In a true sense, we are business rants, big box small format stores—but partners, and as business partners we now we are all fighting for the same cus- have a fiduciary duty to disclose what is tomers. One way going on to each other. We used to have “We need to bring we are trying to a half-mile radius rule, and the current that back to the differentiate our- franchisee was always notified and franchisees because selves from the given the first right of refusal. We need it would renew the competition these “We used to have a half- to bring that back to the franchisees be- security that every- days is by our cause it would renew the security that one needs to protect product selection. mile radius rule, and the everyone needs to protect our invest- our investment and The other is by current However, franchisee one of the disturbing was ment and our financial return and allow our financial return growing our store things we are hearing is that many us to grow into the system. and allow us to grow count. times,always even whennotified these newand locations given Our franchisor must realize that we into the system.” SEI has said openthe up first close toright an existing of refusal.” franchisee, indeed need territory rights. It is some- that the number the franchisee always appears to be way thing I am hoping we will see down the one advantage of down on the list of finding out about it. line. It is becoming more and more nec- JOE GALEA their expansion It is my belief that whenever a new store essary with the number of SEI acquisi- CAN BE REACHED AT plan is that it is available close to another 7-Eleven, tions to bring everyone to that good, 831-426-4711 or [email protected] provides oppor- the franchisee should be notified as a positive feeling that we used to have when tunity for exist- common courtesy so he or she will have encroachment was in our agreement.

MARCH | APRIL 2017 AVANTI 31 MARCH | APRIL 2017 AVANTI 33 ERIC H. KARP, ESQ., GENERAL COUNSEL TO NCASEF

During my tenure as the General By our calculation, SEI has engaged “In 2015, for the first time, Counsel of the National Coalition, I have in acquisitions involving more than $6 often wondered how best to characterize billion during the period 2013 to date. By the gross margin contribution our franchisor. Is 7-Eleven, Inc. a conven- contrast, over the last three years, the from gasoline exceeded that ience store retailer and franchisor? A company has spent less than $340 million gasoline provider? A logistics and supply on capital improvements to existing cor- of the in-store merchandise company? An accounting and bookkeep- porate and franchised stores, not includ- Whating company? Business ingIs $54 Yourmillion on gasoline Franchisor tanks. To put gross margin In? contribution.” Increasingly, the answer seems to be it another way, the company is willing to that SEI is well on its way to being best spend handsomely to increase its portfo- characterized as a gasoline company, tak- lio of gasoline assets, both wholesale and only 49 percent, or half that rate. In 2015, ing into consideration both its retail and retail, but only willing to spend pennies for the first time, the gross margin con- wholesale gasoline operations. The most tribution from gasoline exceeded that of recent chapter in this book is the April 6, the in-store merchandise gross margin 2017 announcement that SEI’s parent contribution from company stores. company would purchase 1,130 Sunoco While 2016 financial statements are gas stations and convenience stores for not yet available to us, the parent com- $3.3 billion, with the transaction antici- pany reports that in 2016 41.4 percent of pated to close in August 2017. This trans- SEI sales came from gasoline. With the action follows a much smaller one in June Sunoco acquisition, that will certainly 2016, which involved the purchase of 79 soar. In a similar vein, after the Sunoco gas stations and convenience stores in Cal- acquisition, we estimate that 44.3 percent ifornia and Wyoming from CST brands. of all the 7-Eleven locations in the United Before that, SEI engaged in five addi- States will be gasoline stores. tional gasoline-related acquisitions, in- We can also report that SEI’s total cluding a December 2011 transaction with by comparison on fixtures, equipment revenue fell by 21 percent from 2013 to Exxon Mobil involving 183 gasoline prop- and remodeling and refurbish- 2015, driven primarily by a decline in erties, a December 2013 acquisition of 145 ment of its franchised con- fuel sales of 28 percent over the same gasoline stores and a wholesale gasoline venience stores. period of time, driven, in business, a January 2016 transaction with The dominance of turn, by lower oil Biscayne Petroleum involving 94 retail the gasoline component prices. However, from properties and 7 supply contracts, and a of SEI’s financial condition is 2013 to 2015, SEI’s gross May 2016 acquisi- exemplified by the fact that from 2010 to margin on fuel sales rose by nearly $30 million. Quite obviously, ERIC H. KARP tion from Harbor 2015, its gross margin on the sale of gaso- the only way the company could have CAN BE REACHED AT Petroleum involv- line increased by 94 percent; but over the 617-423-7250 ing wholesale fuel same period of time, franchised in-store realized higher profit on lower sales was [email protected] contracts. merchandise gross margin increased by to raise prices at the pump, to the detriment of convenience store sales at gasoline stores. The end result was increases in SEI net income ranging from about 8 percent to 10 percent per year, driven primarily, one could argue almost exclu-

continued on page 36

34 AVANTI MARCH | APRIL 2017 “SEI is well on its way to being best characterized MARCH | APRIL 2017 AVANTI 35 as a gasoline company, taking into consideration both its retail and wholesale gasoline operations.” continued from page 35 sively, by the profit generated from the gasoline business. “After the Sunoco acquisition, we estimate that What’s driving the strategic deci- 44.3 percent of all the 7-Eleven locations in the sions? What Because Business SEI and its par- Is Your FranchisorUnited States In? will be gasoline stores.” ent company keep its strategies as close to the often to the detriment of pus Christie has a dining area with 28 vest as possible, we are con- the franchisee. Over the last seats and an outdoor patio for 20 more, stantly forced to play detective and make four years, SEI’s gross mar- which is different from the traditional reasonable deductions based on the evi- gin on gasoline has vastly outpaced com- 2,500-square-foot 7-Eleven.” This dence available to us. Here are my pany convenience store gross margin should be troubling news to franchisees. thoughts. and franchisee gross margin. That makes Given that SEI has been repeatedly First, the parent company of SEI has it less painful for SEI to sacrifice in-store asked for evidence of the incremental had more than its share of troubles, with sales in favor of profit at the pump in its labor costs and incremental net profit boardroom battles, a major wage and gasoline stores, which after the Sunoco from fresh food and hot food, to no hour scandal in Australia, and a stock acquisition will reach almost 1/2 of all avail, franchisees should be very wary of that substantially underperforms the stores in the United States. the company’s inattention to their bot- Nikkei Index and the S&P 500. Its super- tom line. markets and department stores have been This flies in the face of Cheryl losing money. The only segment that has Bachelder’s theory of the management of shown growth and profitability is the a franchise company, which is centered convenience store business. It needs yet on unit level profitability. See more sources of profit, and SEI’s parent is www.https://hbr.org/2016/10/the-ceo-of- willing to spend a lot of capital to get it. popeyes-on-treating-franchisees-as-the- Thus, the planned expansion in the U.S. “The company is willing most-important-customers. Her servant with the goal of reaching 10,000 outlets leadership model led to a remarkable by 2019. to spend handsomely turnaround at Popeyes and its recent sale Second, gasoline and gasoline pumps to increase its portfolio to the parent company of Burger King for are not like franchisees. They don’t or- $1.8 billion. The management of SEI, ganize into franchise owners’ associa- of gasoline assets, both which has been seeking a liquidity event tions. They don’t have a website, or an wholesale and retail, for years: please take notice. Cheryl advertising supported publication or de- Bachelder is not some bleeding heart lib- velop independent, mutually beneficial but only willing to spend eral. She is a hardheaded, supremely relationships with their vendors. They pennies by comparison competent business manager who fig- don’t hire lawyers and other professionals ured out that the best way for a franchisor to protect their interests. They don’t need on fixtures, equipment to succeed is to have successful and prof- to be invited to sit on committees and and Fourth, remodeling the Sunoco acquisition and may itable franchisees who vote with their they don’t talk back; in fact, they don’t signal an even deeper incursion into the checkbooks by buying more and more lo- care if you talk to them or not. introductionrefurbishment of the fast food of formatits into cations in the system. Third, the gasoline business pro- thefranchised 7-Eleven franchise stores.” system. As re- Fifth, part of the deal with Sunoco is vides a source of increasing gross margin ported by the Dallas Morning News: “7- a 15-year supply agreement under which contributions, in the face of declining Eleven, which has been building its fresh SEI will purchase 2.2 billion gallons of merchandise gross margins in franchised food offerings in recent years, is gaining gasoline per year. Although not dis- stores and in company stores over the a whole new menu of breakfast and closed, we have to wonder whether favor- last five years. Gasoline is a business seg- lunch tacos with Laredo Taco Company able or at least controlled pricing to SEI ment where SEI controls the retail price, and Stripes. A new Stripes store in Cor- continued on page 38

36 AVANTI MARCH | APRIL 2017 MARCH | APRIL 2017 AVANTI 37 continued from continued from page 36 page 18 more than $2 bil- is part of that arrangement. This will at least the last 15 years, that the National lion in retail sales, predicts C2G. • Americans allow SEI to continue to grow its gross Coalition, every FOA and every fran- overwhelmingly say that low gas prices are profit margin on gasoline with the con- chisee be focused laser-like on a single good for the economy (84 percent) and that sequences to franchisees noted above. and solitary goal: achieving a fair and bal- gas prices would have to increase by more What As we’ve Business stated in the past, Isthese Your are anced Franchisor 2019 franchise agreement, In? which than $1 per gallon before they cut back on very crucial times in the business life of is the product of transparent, good faith driving, according to results of the NACS Con- sumer Fuels Survey. • Pizza chain Domino’s every 7-Eleven franchisee. This is also an collaborative negotiation, and which al- has teamed with Starship Technologies to test existential moment in the 40-year history lows every franchisees to attain a fair re- pizza delivery by robot in Hamburg, Germany of the National Coalition. It is vitally im- ward for their investment and hard work this summer, reported TechCrunch. If all goes portant now, more so than it has been in on behalf of the brand. well there, Domino’s and Starship intend to bring robot pizza delivery to the Nether- lands as well. • Amazon plans to sell beer and wine from its new Seattle automated convenience store, reported Recode. Dubbed Amazon Go, the store concept allows shoppers to grab prepared food and drinks off of shelves and automatically be billed without stopping to pay on the way out. • Kraft Heinz “It is vitally important now—more so than in at continued on page 47 least the last 15 years—that the National Coalition, every FOA and every franchisee be focused laser- like on a single and solitary goal: achieving a fair and balanced 2019 franchise agreement.”

MARCH | APRIL 2017 AVANTI 39 Vice ’ Chairs THEForum THREE-LEGGED STOOL BY ROMY SINGH VICE CHAIRMAN NCASEF • PRESIDENT, EASTERN VIRGINIA FOA

Convenience store sales are the sum the real decision makers at franchisees in a local FOA to of the efforts of the people involved, and store level who sell their try it, when you are successful I often compare it to a three-legged stool products. They realize that you as a vendor have the oppor- composed of 7-Eleven, Inc., vendor franchisees decide what tunity to show those positive manufacturers or service people, and products need to be carried sales numbers to SEI and poten- franchisees. The objective of the stool is and what products need to tially get your product ap- to “sell more stuff,” but like the stool, we be deleted. Do we use SEI’s proved. In the meantime, all need each leg in the relationship to be approved product recommen- franchisees can purchase and strong, and to support the other with dations? Absolutely we do. It’s sell non-approved, non-recommended confidence, knowledge, and respect. items as part of our contract. We are the I would like to thank our vendors, “I WOULD LIKE TO “real buyers” in our stores. first for providing us with all the fine Sometimes vendors see the ups and THANK OUR products we sell in our stores, and sec- downs in the other leg of the stool, the ond for your ongoing support of the VENDORS, FIRST franchisor/franchisee relationship, National Coalition and our local FOAs. FOR PROVIDING US which is more like a husband and wife. We all know we can’t live without the WITH ALL THE FINE We have a legal contract, we share a bank incremental sales from the new prod- PRODUCTS WE SELL account, we both have a heavy invest- ucts you provide as well as the core IN OUR STORES, AND ment in the relationship, and our future products that form the elementary part SECOND FOR YOUR is explicitly tied. Like a couple, we both of our businesses. Likewise, without ONGOING SUPPORT have expectations your support of our FOAs we could not OF THE NATIONAL from each other “When we all exist or do the work we do in our com- COALITION AND and we must com- work together, munities to make connections and get municate, be trans- to know our customers. We also would OUR LOCAL FOAS.” parent, and discuss and we are not have the resources to participate in our differences committed to the legislative activities that protect our the first level in accepting your product openly. Sometimes supporting customers and our businesses. into our stores. If SEI merchandising sees we do this well, and each other, When we all work together, and we value in your product, franchisees are al- sometimes we do we succeed.” are committed to supporting each most always willing to give that product not. Like a couple other, we succeed. If we sell more prod- a try. In the end, if we see value in your we must be positive towards each other, ucts, you sell more products. In return product, we will reorder it. and sit together and talk about budgets we all gain more gross profit. Even SEI Likewise, FOAs are a good place to and finances often. Franchisees in many is happy in this scenario. test non-approved, non-recommended cases have invested their life savings in Some vendors participate with our products. If a product is not recom- their stores, and we deserve to be treated FOAs very proactively, as they under- mended, and you can get a group of like investors, like family and like busi- stand what FOAs ness partners. To- ROMY SINGH can give in return. gether we can grow CAN BE REACHED AT “FOAs are a good place to test non-approved, 757-506-5926 They understand non-recommended products.” the business. [email protected] that franchisees are

MARCH | APRIL 2017 AVANTI 41 Vice ’ Chairs ForumVIXXO MAINTENANCE PRICE INCREASE—THE UPDATE BY REHAN HASHMI VICE CHAIRMAN NCASEF • VICE PRESIDENT, ALLIANCE OF 7VELEVEN FRANCHISEES FOA

Roughly two years ago, National that in 95 percent of cases out of code BIBs “We hope that SEI will Coalition Board members and officers held do not cause a machine malfunction, and work with the National a maintenance contract meeting with SEI franchisees should not be charged the addi- Coalition to resolve main- wherein Joe DePinto decided to put the tional $100 fee. SEI agreed to remove it from tenance issues and delay planned maintenance fee increase on hold the contract, but we haven’t seen confirma- mainly because franchisees were not re- tion that they did. We don’t know if any the price increase until the ceiving good service from FM Facility franchisees are still being charged the addi- renewal of the franchisee Maintenance, which is now Vixxo. At the tional fee for out of code BIB products, but agreement in 2019.” time, SEI agreed to work with Vixxo to re- SEI hasn’t formally told us that it was done. solve our issues and come back to the Na- 2. Duct Cleaning. A review of the don’t email invoices. They have a blank tional Coalition before any maintenance preventive maintenance scheduled by FM tablet and ask for our signature. We don’t price increase would be put into affect. I shows semi-annual cleaning of return and know what we are signing. wrote an Avanti article about that meeting discharge HVAC for grills is an SEI ex- 4. Expense Approvals. When equip- in the January/February 2015 issue, and I pense. In many stores we don’t know ment breaks down it often takes up to two highlighted the maintenance issues SEI and when the last duct cleaning was per- weeks to repair due to 7-Eleven expense ap- Vixxo said they would address before a formed. It could be decades. Joe DePinto proval delays or because parts are not im- price increase would be implemented. Now agreed that the service should be part of mediately available. We have seen some I will update you on what has changed. the regular preventative maintenance improvement in this area, but still have de- While it is certainly true that SEI did program, and to date it is not. lays in how SEI approves expenses. If some- not impose the maintenance price increase 3. Signed Work Tickets. Franchisees thing breaks down, the contractor needs to on existing franchisees back then—for requested signed work tickets be left in talk to the local DFM. The local DFM then which we are thankful—we has to determine if it makes soon realized that all new fran- sense, and nine out of 10 times chisees and anyone who re- “SEI HAS DECIDED TO INCREASE he does it, but the amount of newed their lease or renewed MAINTENANCE PRICES AS MUCH time it takes varies. If it is a rev- their agreement were subject AS 32 PERCENT IN SOME AREAS, enue-generating piece of equip- to the increased prices. So it BUT ISSUES WE DISCUSSED IN ment, franchisees can’t afford the turns out, SEI did successfully 2015 ARE NOT RESOLVED.” delays. We can say SEI has made place a maintenance price in- some improvements, but there is crease on many franchisees. still room for improvement. The original intent was to hold the in- stores at the time of service, or be emailed 5. Asset List Update. Franchisees believe crease for all franchisees until the service to the franchisee’s personal account while the asset list is inaccurate and in many cases issues were resolved. Joe DePinto had said the contractor is still in the store. As of overstates the equipment. Some pieces of if the service levels were not met, fran- today, maintenance contractors still don’t equipment decommissioned years ago may chisees would not have to pay a service in- have the handheld devices to print the work still be on the list and may be contributing to crease. Now, SEI has decided to increase the tickets or the ability to email the invoices to the cost increase. SEI promised to bring the maintenance prices for the rest of us, as the franchisee’s personal email as we re- list up to date by doing a physical audit of the much as 32 percent in some areas. I want quested. We also want to be able to review asset list for each store, but the audit has not to revisit, point by point, some of the issues charges on the Vixxo 24/7 website. This happened. How can we justify the price in- I addressed in my original article. change for paperless work tickets has still crease without knowing the exact number of 1. Out of Code BIBs. Franchisees claim not happened. I still have contractors who continued on page 45

42 AVANTI MARCH | APRIL 2017 MARCH | APRIL 2017 AVANTI 43 VIXXO MAINTENANCE PRICE INCREASE—THE UPDATE continued from page 43 pieces to be serviced in a given market? pieces of equipment that are essential to but we are getting “We would also like ’ ’ 6.Vice P1, P2, P3 Classifications. Franchisees successfully selling fresh and hot foods. SEI the price increase.Vice Chairs Chairsa holistic review, haveForum long believed that these classifications agreed to revisit these classifications and We expect SEI Forum to are outdated and don’t match our business revise them, but nothing has changed. honor their word taking into con- model. We are a foodservice destination They should all be prioritized as P1. and hold the main- sideration issues now and certain pieces of equipment are 7. Vixxo’s 24/7 website. SEI and Vixxo want tenance price in- such as minimum essential for selling fresh and hot foods. If franchisees to use it more, but we are still crease until the wage increases, a light goes out in my doughnut case, it is struggling to log in. Some franchisees have issues are resolved. sugary beverage a P5 and they have 30 days to respond! The to re-register on the website every 30 days. We hope that SEI Wisco unit, where our hot foods are Since we don’t have Internet access in our will work with the taxes, declining staged, is a P2 priority of 24 hours, and stores we have asked for an app to track National Coalition customer counts should be a P1, 4 hours. How can we not cases from our smart phones, but this has to resolve these is- and increased offer hot foods for 24 hours (or more)? not happened. sues and delay price competition.” Our open air case, which probably always We have other issues, such as over- increase until the re- contains $500 worth of inventory, is a P2, billing. Contractors will check in by making newal of the franchisee agreement in 2019. 24 hours. What are we supposed to do with a phone call when they arrive at the store, We would also like a holistic review the inventory for 24 hours? Most sand- but they don’t have a way to check out. taking into consideration issues such as wiches have a 2-day code. Our condiment Sometimes they finish working and eat minimum wage increases, sugary beverage station, bun lunch in our parking lot, and we pay $75 for taxes, declining customer counts and in- REHAN HASHMI warmer, and chili their lunch break. We need some kind of creased competition. In light of all of this, I CAN BE REACHED AT cheese dispenser are tracking mechanism at the store level. think the best thing to do would be to make 847-845-8477 or [email protected] all P2. These are To date, SEI has not worked with the this price increase part of the 2019 agree- revenue-generating National Coalition to resolve these issues, ment renewal.

THE APP INDUSTRY—IS IT FOR US? BY NICK BHULLAR VICE CHAIRMAN, NCASEF

It’s been nine years since the launch of find a place to sleep, the famous Apple App Store. Needless to to find old friends, to “STATISTICS SHOW THAT FULLY EN- say, a lot has changed since we first heard adventure in foreign GAGED CUSTOMERS, ALSO KNOWN AS Apple’s pivotal ad campaign motto “There’s lands and to navigate BRAND AMBASSADORS, DELIVER A 23 an app for that.” What started off as novelty through the ever-ex- PERCENT MINIMUM OVER THE AVERAGE items—simple time waster games, and panding world of CUSTOMER IN THE SHARE OF WALLET, clever ways to use your iPhone camera’s content media. The PROFITABILITY AND REVENUE.” flash as a flashlight—have app in- grown into critical parts of dustry has come very far, When Apple first launched the App the world’s economy and dig- and very few industries are Store, there were about 20,000 apps. Today, ital infrastructure, an integral able to grow as quickly and there are about 4 million apps available to aspect of day-to-day life, and dramatically. Let’s take Evan consumers. The entire app industry gener- booming billion dollar busi- Spiegel’s app Snapchat as a ates some $56 billion in revenue and that nesses. case reference. In May of number is projected to hit $77 billion in Apps have integrated 2015, users downloaded the 2017. Globally, the mobile phone market themselves into nearly every app 13 million times and in and the app market are growing and are aspect of our lives; we use the month of May 2016, that likely to continue to grow.

them for directions on the number doubled to 27 mil- continued on page 47 road, to find places to eat, to lion. 44 AVANTI MARCH | APRIL 2017 MARCH | APRIL 2017 AVANTI 45 continued from page 38 THE APP INDUSTRY—IS IT FOR US? continued from page 45 Co recently made a Vice ’ Vice ’ surprise $143 billion Chairs Apps are also the reason why we no Chairs Forum offer for Unilever in a bid to build a global longer carry around our plastic loyalty cards “STARBUCKSForum CORP, consumer goods giant, but it was flatly re- for grocery stores and pharmacies. Most A PIONEER IN GETTING jected by the maker of Lipton tea and Dove businesses have caught up to the fact that CONSUMERS TO PAY soap, reported Reuters. • German grocery loyalty programs allow for them to nurture FOR PRODUCTS WITH A chain Lidl is set to open 20 stores this sum- and connect with the consumer. By analyz- mer in Virginia, North Carolina and South ing customer purchase patterns through the MOBILE PHONE, ADDED Carolina, reported the Washington Post. app, businesses can send them the right of- A FEATURE IN 2015 Within 12 months of opening its first U.S. THAT LETS CUSTOMERS stores, the company is slated to have 100 fers at the right times. Statistics show that locations up and down the East Coast. • 7- fully engaged customers, also known as ORDER AND PAY FOR Eleven is tied for 9th place among retail- brand ambassadors, deliver a 23 percent BEVERAGES IN AD- ers on the 2017 Temkin Experience Ratings, minimum over the average customer in the VANCE AND PICK THEM an annual customer experience ranking of share of wallet, profitability and revenue. UP WITHOUT WAITING companies. The other retailers occupying Even if you have doubts about mobile loyalty IN THE CASHIER LINE.” the #9 spot with a score of 73 percent are programs, 86 percent of marketers ranked Apple Retail Store, Costco, Kohl's, Marshalls, mobile loyalty campaigns as very effective. Nordstrom, Rite Aide and Staples. • Illinois This brings us to our main question, There will be challenges, but there are state lawmakers are considering a proposal “Is the App Industry a good fit for 7- hardly any businesses without them. that could make Illinois the first state in the Eleven?” Well, the answer is yes, very much Midwest and the ninth nationally to legal- Starbucks Corp, a pioneer in getting so. I fully acknowledge that the app space is ize recreational pot, reported the Associ- consumers to pay for products with a ated Press. • A 2010 study by Wayne State crowded, however, apps developed using mobile phone, added a feature in 2015 University measured the span of smiles on energy, attention and financial resources are that lets customers order and pay for Major League Baseball players from their proven to be effective. And there is no rea- beverages in advance and pick them up 1952 trading cards, and found that those son that our 7-Eleven app could not be de- without waiting in the cashier line. Now, who didn’t smile in their pictures lived an veloped with the same intentions. Many 21 percent of transactions in company- average of 72.9 years, versus 79.9 years for franchisees have given feedback into the de- owned U.S. stores come from the app, the players who did smile. • Rumor of a BP velopment of this along with its fair set of challenges. In takeover has resurfaced, but this time it’s “Many franchisees app, and many Starbucks’s case, as mobile orders and ExxonMobil that’s testing the waters, re- have given changes are being pay became popular, operational chal- ported the Evening Standard. The U.S. gas feedback into the made to the app as lenges came hand-in-hand, such as con- giant has recently sounded out BP’s major development of a result of those gestion at the hand-off plain due to high shareholders to gauge their interest in a po- recommendations. tential takeover. • Walmart is now offering this app, and volumes. The congestion resulted in Even though it “pickup discounts” to U.S. shoppers on many changes walk-in customers not making a pur- items they order online and pick up in-store, are being made seems like a long chase due to the heavy rush, impacting as it revamps its e-commerce service to to the app as a road ahead, we can comparable sales negatively. Starbucks close the gap with larger rival Amazon.com, only achieve our Corp, however, has been working relent- reported Reuters. • UPS recently tested result of those rec- goals by working lessly to improve the app and to resolve drone delivery launched from a truck, re- ommendations.” together on this. the operational issues. As should we! ported CNNMoney. The company used a It’s imperative that we (franchisees and new electric delivery truck with a drone corporate) get to the depth of challenges launchpad atop it. This allows the drone to with our 7-Eleven app. I realize that a ton make one delivery while the human driver of feedback will have to be provided by makes another. They later rendezvous at an- franchisees and a ton of work will have to other location, where the drone is loaded with a fresh package. • Japan seems to be done on corporate’s end, but it’s a nec- have too many c-stores and not enough essary evil as the app industry is only NICK BHULLAR workers or customers, reported Nikkei CAN BE REACHED AT Asian Review. Customer numbers are de- going to get bigger 626-255-8555 or clining because of intensified competition and bigger. [email protected] continued on page 50

46 AVANTI MARCH | APRIL 2017 MARCH | APRIL 2017 AVANTI 47 Franchisee Guest Column

Dispelling Some ETA Myths

By Pete Gragnano, President, Suburban Washington FOA

We are currently in the midst of one of Last year I received a call from a our franchisor's most extensive initiatives in 10-plus year franchisee who was hav- “ETA IS BEING PROPOSED BY A recent years, Expand The Assortment (ETA). ing equity issues. His seasonal store Numerous references have been written was being hit by the combined SEI NUMBER OF CORPORATE EXECU- about this endeavor in past issues of Avanti, forces of encroachment (too many of TIVES AS BEING THE SOLUTION and more are likely to follow in the coming our stores in close proximity)— TO OUR MINIMUM WAGE ISSUES.” years as it is rolled out to all stores. I can which was reducing sales in all of the question the increase of 500+ SKUs in our stores in the area—and the dreaded expira- In looking at the long-term solution ob- stores or whether we really need 80 breakfast tion of the Master Lease (which caused him jectively, let's run some numbers. Assume (I and nutritional bars. I could ask why the im- to move from a 50/50 split to approximately know what happens when you assume) that plementation of ETA across the system has 52/48 in favor of 7-Eleven). Combine these his store operates on a 40 percent Gross Profit not been supported in the same fashion or two internally generated problems with the margin (an achievable target if your store produced the same results as stores located annual $1 increases in the minimum wage in sales are not heavily weighted towards either close to headquarters in Dallas. However, I consecutive years, along with normal com- cigarette and/or alcohol sales, and has good am here neither to speak in favor nor against petition from other retailers in his vicinity, fresh food and non-alcoholic beverage sales) ETA, as many of my colleagues will. Rather, and we have a recipe for disaster. and that he operates on a 50/50 split (remem- I am here to dispel some myths about ETA, I advised him to secure a Line of Credit ber, he's at 52/48, but 50/50 makes the math which I will call the “Magic Bullet” and from a local bank to avoid using his credit easier). Based on these two assumptions, “Build It and They Will Come.” card for cash advances to maintain mini- every $1,000 in sales yields the franchisee $200 in gross profit. Therefore, in order to merely make up the $25,000 credit line the “Our franchisor is evidently hoping that our customers will walk store needs an annual sales increase of around our stores and notice that we have expanded our HABA, $125,000, or a little over $10,000 per month. groceries, automotive, etc., and go on a buying binge.” Based upon his current Situational Analysis (declining sales due to encroach- The “Magic Bullet” mum net worth and to avoid the potential ment), the likelihood of achieving continual ETA is being proposed by a number of negative consequences of an Equity Building $10,000 month-after-month sales increases corporate executives as being the solution to Budget Agreement (EBBA) with our fran- is slim to none, and Slim has left town. Con- our minimum wage issues; a panacea to cure chisor. He took my advice and secured a sequently, ETA as the “Magic Bullet” does all ills. This appears to follow the lead of Joe $25,000 credit line. not work. As I wrote in a prior Avanti article, DePinto, who has told the NBLC that he feels In January of this year he called to tell it is only one component of a multi-faceted stores will be able to “sell their way out” of me he had exhausted the $25,000 and was strategy to help franchisees survive increases the unprecedented and dramatic increases in back to where he was a year ago. In speak- in the minimum wage. the hourly wages of our employees. While I ing with 7-Eleven operations he was offered “Build It and They Will Come” was once told that “sales solve all problems,” an EBBA in the short-term and was told When ETA was first proposed to fran- such is generally not the case with our that ETA would solve his equity issues in chisee leaders and our vendor partners at a unique business the long-term. Wisely, he has seen that his National Coalition meeting several years ago, model. Here's a ship is sinking and has put his store up for SEI senior Merchandising management told PETE GRAGNANO real life scenario sale. A very good operator is now forced to the audience that we had narrowed our CAN BE REACHED AT which negates sell his store, despite working 7 days and 80- product assortment too much and that our 443-472-2327 or 90 hours per week in an effort to stay in [email protected] that theory. customers were going elsewhere to buy what business. continued on page 50

48 AVANTI MARCHNOVEMBER | APRIL | DECEMBER 2017 2016 MARCH | APRIL 2017 AVANTI 49 Franchisee Guest Column

continued from page 49

we no longer had on our shelves. Pedialyte continued from page 47 was a product cited by Joe DePinto as a sta- “WE NEED AN EXTENSIVE within the industry and ple product that we no longer carried, but ADVERTISING PROGRAM more competition from should bring back. THAT TELLS THE CON- other industries like supermarkets and drug During the Question and Answer ses- stores. • PepsiCo Inc. now generates 45 per- sion that followed the presentation, I pro- SUMER WE ARE ONCE cent of its revenue from so-called guilt-free posed this scenario to the Merchandising AGAIN THE ‘ONE STOP’ products, which include lower-calorie drinks team: and items with grains, fruits and vegetables, re- It's 2 am on a rainy night and my wife FOR ALL OF THEIR ported Bloomberg. • Retail leasing specialists sends me out to get Pedialyte for the baby. CONVENIENCE NEEDS.” R.J. Brunelli & Co. announced that 7-Eleven has I go to our local 7-Eleven, but they don't extended its contract with the firm from five have it. I get soaked getting back into the Nada. Our franchisor is ev- New Jersey counties to include Philadelphia, Bucks and Montgomery Counties in Pennsylva- car and proceed to the nearest 24-hour idently hoping that our nia. SEI is seeking 2,800- to 3,000-square- customers will walk drug store (CVS, Walgreens, etc.) and re- foot freestanding or end cap units with a turn home with the Pedialyte. The next around our stores and no- 25-foot minimum width in these areas. • Wal- time I need Pedialyte in the middle of the tice that we have expanded mart’s new Supercenter in Tomball, Texas, in- night, where do you think I'm going to go? our HABA, groceries, automotive, etc., and cludes the company’s first rollout of mobile My question was met with about five sec- go on a buying binge. scanning technology, reported CSP Daily News. onds of awkward silence, followed by mov- This theory conflicts with studies done Customers can use the Walmart Scan & Go app ing onto the next question. Franchisees and by NACS that indicate the average con- on their smart phone to scan items while vendors around me wondered why my ques- sumer spends approximately two minutes shopping and pay instantly without waiting tion wasn't answered; namely, how do you from the time they enter and then exit a in the checkout line. • Stumpy’s Hatchet House tell me that you have Pedialyte back in stock. convenience store. If we are banking on was the first and only hatchet throwing facil- The following day I met one of the sen- someone glancing down an aisle while ity in the United States when they opened their doors in April of 2016, and now they are the ior members of the Merchandising team waiting in line to notice our expanded as- first and only hatchet throwing franchise in the and asked why my question did not get a sortment, we are only kidding ourselves. U.S., thanks to the instant success of the response. I was sheep- Some franchisees will be out of business hatchet house and inquiries regarding franchis- ishly told that it was felt long before they realize any of the financial ing from across the country. • A federal judge that it wasn't a benefits of ETA. has temporarily blocked Seattle's first-in- question, but We need an extensive advertising pro- the-nation law allowing drivers of ride-hail- rather it was a gram (i.e., TV, radio, billboards, etc., as well ing companies such as Uber and Lyft to s t a t e m e n t . as via the 7-Eleven App, like the QSRs and unionize over pay and working conditions, re- drug stores that we are ported the Los Angeles Times. • The total num- competing against) that ber of U.S. restaurants decreased by two 180 count case “The last time I looked in the dictionary, tells the consumer that percent from a year ago to 620,807 units, according to The NPD Group. With the decline, ‘advertising’ was not a four letter word and we are once again the should be freely used in our business.” restaurant density is at its lowest level in the “one stop” for all of their past ten years, dropping from 1,992 units per convenience needs. We million in fall 2007 to 1,924 units per million in Thereafter, I got the answer that I was look- can't afford to wait for the “Build It and fall 2016. • Kellogg Company recently an- ing for: “We are going to advertise.” This They Will Come” theory to achieve the de- nounced it will begin to exit its Direct Store De- McLane #794859 • Coremark #436991 will be done on a store specific basis and sired results. The last time I looked in the livery network in the second quarter, could be as simple as a mailing to homes dictionary, “advertising” was not a four let- transitioning the DSD-distributed portion of the and businesses surrounding the store or ter word and should be freely used in our company's U.S. Snacks business to the ware- placing flyers on parked cars. Other forms business. house model already used by Pringles and the of advertising would then complement We need executive management in Dal- rest of its North American business. • Wells these. las to eliminate their reticence to advertise Fargo customers can now use their smart- phones to withdraw cash from any of the In the Baltimore/Washington, D.C. area and we need it now, more than ever. Only bank’s ATMs, reported Reuters. Wells Fargo is our livelihoods are at stake. ETA was done in all of our stores in 2016, the first U.S. bank to roll out cardless ATMs yet we haven't seen any of the promised ad- This is my opinion and I welcome yours. vertising. No flyers. No mailings. Zero. Zip. continued on page 64

50 AVANTI MARCH | APRIL 2017 MARCH | APRIL 2017 AVANTI 51

Vendor Guest Column

Getting The ‘Basics’ Right

By Greg Addison, Sr. Vice President, The Lewer Companies

Financial Advisors are often asked to ex- tively and everything in between. But press an opinion on the right way to invest if you manage the three fundamentals “THE MOST IMPORTANT and save for retirement. There are literally cited above, you can't go wrong. a hundred or more different variables to The first and third are self-evident; ELEMENTS TO consider when answering that question. the middle criterion—minimizing self- FINANCIAL-PLAN However, if you get the “basics” right, it's destructive behavior—is a little more ab- SUCCESS ARE: okay if some of the details are a little stract. To me, that suggests things fuzzy. I don't mean to minimize the like chasing the latest investment 1. An adequate savings rate, complexity involved with fad, a lack of “market saving for retirement and in- courage,” paying exces- 2. Minimizing truly self- vesting in general. Well … sive fees and excessively destructive behavior, maybe I do intend to mini- trading your positions. 3. Living below your mize that stuff. Yes, I recognize that When you read pub- trading may be part of means.” lished opinions on this one of those aforemen- topic you see lots of tactics tioned strategies that work for you're well on your way. discussed, such as: invest for the long-term some people and not for others. It may be fair Good luck and remember: “It’s not how without market timing; invest globally; be to re-characterize that middle criterion as much money you make. It’s how much contrarian; allocate to underperforming minimizing undisciplined behavior. Thus, if money you keep and how hard it works for sectors. Though these tactics are all sensi- your strategy calls for active investment de- you!”—Warren Buffet. ble, they don’t represent the “big picture.” cisions, you can be The “big picture” consists of only three considered non- very basic elements, and it isn’t rocket sci- self-destructive if ence. The most important elements to fi- you operate accord- nancial-plan success are: ing to a clear set of 1) An adequate savings rate rules rather than on 2) Minimizing truly self-destructive the basis of im- behavior pulses such as fear 3) Living below your means or greed or the That's it—it’s not more complicated most recent article than that. That's the “big picture” about you’ve read. which too many lose sight. I like Dimen- So it’s basic fi- sional Fund Advisors’ approach; others are nancial science: 1) attracted to any one of a number of other Save early and often, approaches. There's 2) implement a dis- GREG ADDISON room for a wide va- ciplined strategy CAN BE REACHED AT riety of approaches that works for you, (816) 753-4390 or [email protected] to investing—ag- and 3) live within gressively, conserva- your means, and

Please Note: This information is not intended to provide specific tax, legal or business advice and may not be relied upon for the purpose of avoiding any tax penalties. • Lewer Financial Advisors is a multi-state registered investment advisor domiciled in Missouri. • Lewer Financial Advisors is a member of the Lewer group of companies. The Lewer Companies have been providing financial, insurance and benefit solutions to 7-Eleven franchise owners for thirty years.

54 AVANTI MARCH | APRIL 2017 MARCH | APRIL 2017 AVANTI 55 2017 AFFILIATE FOR FRANCHISEES AND VENDORS: MEMBERS The National Coalition’s Affiliate Member Program Twice a year manufacturer representatives in the National Coalition’s Affiliate Member Program have a chance to meet with the 92 presidents and vice presidents of the Coalition’s 46 Fran- chise Owner’s Associations. Each of the FOAs represent between 15 and 400 franchised stores, and all are located in the 33 states in which 7-Eleven operates stores. The National Coalition’s Board of Directors meets four times per year, and two meetings include an extra two days for an Affil- iate Member meeting—one in May, and one in late October/early November. Each meeting includes presentations from the franchise community, SEI corporate executives, and/or industry executives, plus roundtable discussions, breakout sessions, and group Affiliate Member Signup social events that provide time for one-on-one networking. If your company has an interest in coming to the Each FOA brings a president and a vice president to all Affili- ate and Board meetings. Each Affiliate Member (and only Affili- October 30-31 Affiliate Member Meeting in ate Members) has the opportunity to purchase presentation time Nashville, visit www.NCASEF.com to register as an at National Coalition Board Meetings to present their latest and Affiliate Member. The representatives you designate greatest products to the Board. will then receive an email invite to the meeting. All Affiliate Members receive the National Coalition’s FOA list of Presidents and Vice Presidents throughout the country and Board Presentations contact information for these FOA leaders. Each Affiliate Mem- If your company would like to present before the ber can have up to two representatives at the meetings. During National Coalition Board of Directors at the July 16-17 Board Meeting in Las Vegas, contact Meeting breakout sessions and roundtable discussions vendor represen- and Trade Show Coordinator John Riggio at tatives can ask any question and bring up any topic [email protected], or 262-275-3086. before the group or among individual FOA leaders.

2017 AFFILIATE MEMBERS ADVANTAGE SOLUTIONS ALTRIA GROUP DIST. CO. Tim Villarreal Mark Griffith Franchisees: Call or email the representatives below if you have 1500 Lakeside Parkway Suite 110 6801 Gaylord Parkway Ste 302 questions for them or simply want to speak to a representative Flower Mound, TX 75028 Frisco, TX 75034 214-647-6021 804-484-8531 from their company. timothy.villarreal@advantagesolu- [email protected] tions.net 5-HOUR ENERGY ACOSTA SALES & AON Vince Sullivan MARKETING AJINOMOTO WINDSOR Tonya Leffall Beth Coldsmith 3214 Roan Way Steve Horine 2711 N. Haskell Ave. #800 San Antonio, TX 78259 6106 Mesa Grande 4217 Chetham Dr Dallas, TX 75204 210-788-1547 Austin, TX 78749 Ft Wayne, IN 46835 214-989-2349 [email protected] 512-301-9717 260-492-9797 [email protected] [email protected] [email protected] 5-HOUR ENERGY APTER INDUSTRIES Dempsey Garrett ADVANCE PIERRE FOODS ALTRIA GROUP DIST. CO. J. Scott Apter Tyler Coates 14734 Old Conroe Rd James Duke PO Box 456 Conroe, TX 77384 9987 Carver Rd, Suite 500 6601 W. Broad Street McKeesport, PA 15134 936-520-7789 Blue Ash, OH 45242 Richmond, VA 23230 412-672-9628 [email protected] 513-889-7323 804-484-8531 [email protected] [email protected] [email protected]

56 AVANTI MARCH | APRIL 2017 MARCH | APRIL 2017 AVANTI 57 2017 AFFILIATE CAREER BUILDER MEMBERS Clint Bean 12864 Riverhill Road ARGO TEA Frisco, TX 75033 Cris Bengis 214-252-7058 16 W. Randolph Street [email protected] Chicago, IL 60601 469-579-4150 CHEF'S CUT [email protected] Mark Froke 515 W. 20th St, Suite 4W B2B USA LLC/SENECA New York, NY 10011 Mike Vazquez 714-642-1166 7355 NW 35th St [email protected] Miami, FL 33122 305-406-2305 CHOBANI [email protected] Aaron Steinbach 2606 Montecito Lane BARBOT INSURANCE Richmond, TX 77406 CORE-MARK DON MIGUEL SERVICES 402-250-9985 INTERNATIONAL Michael Elliott John Barbot [email protected] Chris Ladesich 333 S Anita Drive 9001 Grossmont Blvd, Ste 711 3200 Hackberry Road - 3D-29O Suite 1000 La Mesa, CA 91941 COCA-COLA Irving, TX 75063 Orange, CA 92868 619-337-0290 Robert Rivera 972-713-2924 714-385-4500 [email protected] 5800 Granite Parkway [email protected] [email protected] Plano, TX 75024 BHC/PATCO FOOD 479-372-3060 CROSSMARK DON MIGUEL SAFETY [email protected] Clay Blankenship Todd Ginley Thomas Spannring 5100 Legacy Drive 7 Bryan Ct 2920 Dr Andrew J Brown Blvd COCA-COLA Plano, TX 75024 Mansfield, TX 76063 Indianapolis, IN 46206 Maria Suarez 979-492-7680 972-670-8875 314-309-0859 6416 Winder Oaks Blvd [email protected] [email protected] Orlando, FL 32819 CROSSMARK 407-683-9021 Claudia Calhoun DR PEPPER SNAPPLE BIG RED [email protected] 5100 Legacy Drive GROUP Dale Ochs Plano, TX 75024 Lori Tollerud 6500 River Place Blvd. Bldg 1 #450 469-814-1860 5301 Legacy Dr Austin, TX 78730 [email protected] Plano, TX 75024 925-640-3783 972-673-8766 [email protected] CROSSMARK [email protected] Cheryl O'Leary BLUE BUNNY ICE CREAM 5100 Legacy Drive FANFAVE, INC. Randy Martin Plano, TX 75024 Jason Wroth 5915 Caymus Loop 469-814-1508 285 S. Dupont Ave. #104 Windemere, FL 34786 [email protected] Ontario, CA 91761 712-500-4108 909-975-4999 [email protected] CROSSMARK/JOHNSON [email protected] & JOHNSON BON APPETIT Paul Maione FERRARA CANDY Mike Kawas COCA-COLA Kevin Denning Justin Williams 917 Westwind Drive 4820 E. 50th Street North Palm Beach, FL 33408 4676 Commercial St SE #288 Vernon, CA 90058 5800 Granite Pkwy. Suite 900 908-797-2154 Salem, OR 97302 323-584-9500 Plano, TX 75024 [email protected] 503-510-6479 [email protected] 312-771-5943 [email protected] [email protected] DEAN FOODS CAPITOL CUPS Steve Gibson FERRARA CANDY Leslie Williams COOPER TEA David Johnson Colleen Norwine 2711 N Haskell Ave 21 Creek Ct Suite 3400 15902 Halsey Rd Palm Coast, FL 32137 408 S Pierce Ave Dallas, TX 75204 Tampa, FL 33647 334-321-3322 Louisville, CO 80027 214-721-1443 813-431-5855 [email protected] 303-587-8197 [email protected] [email protected] [email protected]

58 AVANTI MARCH | APRIL 2017 2017 FORWARD FOODS KELLOGG'S MSIG AFFILIATE Linnea Solbrook Mark Gramlich John Harp MEMBERS 1307 Pawnee Trail 3601 Rottino Drive 15 Independence Blvd. Carrollton, TX 75007 McKinney, TX 75770 Warren, NJ 07059 NATIONAL TOBACCO 214-843-7012 919-244-6766 908-604-2951 COMPANY [email protected] [email protected] [email protected] Tim Thibodeaux 5201 Interchange Way HBI INTERNATIONAL KRAFT/HEINZ MONDELEZ Louisville, KY 40229 Amy Schneider Megan Sparks Tracey Brown 817-235-4174 3401 W Papago St 501 SE 2nd Street #821 4217 Wichita Drive [email protected] Phoenix, AZ 85009 Fort Lauderdale, FL 33301 Carrollton, TX 75010 815-693-4455 224-374-6600 972-492-4949 NATIONAL TOBACCO [email protected] [email protected] [email protected] COMPANY Kevin Rawlings HEINEKEN LEWER BENEFITS MONSTER ENERGY 7900 Mirror Rock Evan Freuder GROUP Frank Gambina Denton, TX 76210 6500 N. Beltline Rd., Suite 200 Tom Kohl 1 Monster Way 940-268-8018 Irving, TX 75063 4534 Wornall Road Corona, CA 92879 [email protected] 203-461-4858 Kansas City, MO 64111 949 291-1731 [email protected] 913-306-3229 [email protected] NESTLE USA [email protected] Jackie Lawing HOSTESS BRANDS MORINAGA AMERICA 9030 County Road 2432 Scott Ward LOGIC TECHNOLOGIES Jacob Heller Poetry, TX 75160 22306 West 58th Street Tim Chauncey 18552 MacArthur Blvd, Suite 360 972-635-7523 Shawnee, KS 66226 14750 N FM 51 Irvine, CA 92612 [email protected] 913-461-6812 Decatur, TX 76234 915-504-9502 [email protected] 954-803-3034 [email protected] OCEAN SPRAY CRAN- [email protected] BERRIES IMPACT SALES & MOTHER PARKERS TEA Bruce Levine MARKETING MCLANE COMPANY, INC. & COFFEE 7800 60th Ave Diane Drew Sean Luce Peter Doyle Kenosha, WI 53142 1851 Windmill Run 4747 McLane Pkwy PO Box 920779 262-942-5385 Wimberley, TX 78676 Temple, TX 76504 Houston, TX 77292 [email protected] 512-847-3284 254-421-3663 713-682-8250 [email protected] [email protected] [email protected] ORIGINAL GOURMET FOOD INTER-CONTINENTAL MCLANE COMPANY, INC. NACS Matthew Crothers CIGAR CORPORATION Vito Maurici Keith Harlow 52 Stiles Rd Suite #201 Heath Castleberry 4747 McLane Parkway 1600 Duke Street Salem, NH 03079 5016 Bryn Mawr Temple, TX 76504 Alexandria, VA 22314 603-560-8671 McKinney, TX 75070 254-771-7571 703-518-4206 [email protected] 954-294-4918 [email protected] [email protected] [email protected] MCLANE COMPANY, INC. INVENTURE FOODS Jimmy Patterson Russell Law 6201 Northwest H K Dodgen Loop 16471 Innerarity Point Road Temple, TX 76504 Pensacola, FL 32507 254-771-7500 678-787-8304 [email protected] [email protected] MILLERCOORS JOHNSONVILLE Jesse Diaz SAUSAGE 7800 N Dallas Parkway, Suite 400 Gene Rech Plano, TX 75024 PO Box 906 415-819-4031 Sheboygan Falls, WI 53085 [email protected] 920-453-6960 [email protected]

60 AVANTI MARCH | APRIL 2017 MARCH | APRIL 2017 AVANTI 61 2017 AFFILIATE SHAMROCK FARMS SNYDER'S-LANCE 303-530-0600 MEMBERS Chris Perry David Galindo [email protected] 450 Chinahill Court 20252 N. 80th Lane PEPSICO, INC. Apopka, FL 32712 Peoria, AZ 85382 UNILEVER ICE CREAM Tina Ashby 602-803-7497 623-640-5521 Chad Keener 1800 Preston Park Blvd. # 225 [email protected] [email protected] 3853 Ferndale Lane Plano, TX 75093 Frisco, TX 75034 972-334-2050 SHAMROCK FARMS SPACE JAM JUICE 214-842-1473 [email protected] Michael Stremlau Dylan Spencer [email protected] PEPSICO, INC. 1900 W Ruthrauff Rd 18001 S Mitchell St Patty Struzik Tucson, AZ 85705 Irvine, CA 92614 UPTIME ENERGY 7701 Legacy Drive, 2A-44 520-904-7580 949-606-3173 Patrick Pinner Plano, TX 75024 [email protected] [email protected] 1324 Rio Vista Ave 972-334-2368 Fort Myers, FL 33901 [email protected] SMOKEY MOUNTAIN SPACE JAM JUICE 239-209-3857 SNUFF Richard Willemstein [email protected] PEPSICO, INC. Richard Hunsberger 1041 Calle Trepadora Tracy Davitt 5505 Wisdom Court San Clemente, CA 92673 VIXXO 27717 Aliso Creek Rd Waco, TX 76708 972-505-1963 Sid Middlebrook Aliso Viejo, CA 92656 214-914-5531 [email protected] 11333 N Scottsdale Road, Suite 160 949-643-5737 [email protected] Scottsdale, AZ 852654 [email protected] SPIKE, LLC 281-296-0373 SMOKEY MOUNTAIN Greg Guss [email protected] PERFETTI VAN MELLE SNUFF 1850 Reliable Circle Colt Bearden Paul Wilhour Colorado Springs, CO 80906 VOSS ARTESIAN WATER 914 Bucknell Dr. 19522 N Wasson Peak Drive 719-473-5500 Justin Burnett Arlington, TX 76012 Surpise, AZ 85338 [email protected] PO Box 937 817-538-8693 623-523-7031 Sierra Madre, CA 91025 [email protected] [email protected] STORCK USA 626-484-2060 Tony Harper [email protected] 325 N. LaSalle Street Chicago, IL 60610 VOSS ARTESIAN WATER 312-494-5912 David Martin [email protected] 236 W 30th St, 9th Floor New York, NY 10001 SWEDISH MATCH 708-404-3893 Aaron Choate [email protected] 403 Wellington Court Southlake, TX 76092 VPX BANG & REDLINE 817-312-2017 Gene Bulovi [email protected] 1600 North Park Drive Weston, FL 33326 SWISHER INTL 954-665-1274 Ted Zahn [email protected] 657 Channel Ridge Rockwall, TX 75087 WALKERS 904-378-6499 SHORTBREAD INC. [email protected] Neil Apple PERFETTI VAN MELLE SNAGAJOB 170 Commerce Drive Scott Swanson Joe Gabriel TOPPS INC. BAZOOKA Hauppauge, NY 11788 3645 Turfway Road 4851 Lake Brook Dr. CANDY BRANDS 631-273-0011 Erlanger, KY 41018 Glen Allen, VA 23060 Shauna Crusa [email protected] 859-283-1234 703-457-7873 4480 E Reins Rd [email protected] [email protected] Gilbert, AZ 85297 WRIGLEY 570-335-1744 Edward Keogh RED BULL SNYDER'S-LANCE [email protected] 600 W. Chicago Avenue Rachel Ridenour Daniel Bush Chicago, IL 60654 3898 Van Ness Lane 13024 Ballantyne Corporate Place TSN WEST, LLC 312-953-9964 Dallas, TX 75220 Charlotte, NC 28277 Mike Sullivan [email protected] 214-366-0708 843-819-8494 4001 Salazar Way [email protected] [email protected] Frederick, CO 80530

62 AVANTI MARCH | APRIL 2017 MARCH | APRIL 2017 AVANTI 63 Register for the 2017 NCASEF Convention www.ncasef.com

continued from page 28 uct assortment with the store's customer primary determinant in selecting a sta- preferences, it offers many proprietary tion, an increasing percentage of con- continued from page 50 and private-label items, and it has assem- sumers say that the quality of items across its entire net- bled a “restaurant-quality” team that is in- inside the store dictates where they buy work. • The global con- troducing more fresh foods to the chain. fuel. In fact, one in seven drivers (16 per- fectionery market was valued at $184,056 cent) say that the in-store offer is driving million in 2015, and is projected to reach their fueling decision, a 5-point increase $232,085 million by 2022, growing at a CAGR of 3.4 percent from 2016 to 2022, ac- since 2015. A majority (51 percent) of Walmart Unveils Silicon cording to a new report by Allied Market Re- Valley Tech Incubator American drivers still say that the gas search. The chocolate confectionery segment price is the reason that they prefer a spe- Walmart is dominated the market in 2015 with more cific store or chain, but that is a 6-point creating a tech- than one-third revenue share. • Houston is drop over the past two years. now home to the nation's largest fully au- nology-startup The survey also reveals that fueling tomated coin-operated car vending ma- incubator in customers also are going inside the store chine, reported Stores Magazine. Operated by Silicon Valley to more: 42 percent of those fueling up also Carvana, it stands eight stories tall and stores identify changes that will reshape the went inside the store, a 7-point jump up to 30 cars at one time. Customers can retail experience, including virtual re- from two years ago. For those going in- purchase their car online and opt to pick it up ality, autonomous vehicle and drone side, the most popular reasons were to at the car vending machine or have it deliv- delivery and personalized shopping, pay for gas at the register (50 percent), ered to their home. • Several retailers—in- reported Bloomberg. The incubator— cluding Best Buy, L Brands and buy a beverage (45 percent) or buy a which will be called Store No. 8 in a Wal-Mart—have cited the Internal Revenue snack (36 percent). More than one in five reference to a Walmart loca- Service’s delay in issuing refunds to low- tion where the company ex- and middle-income families as a factor in perimented with new store “NACS new national survey slowing store traffic and sales in February, re- layouts—will partner with ported CNBC. • General Motors is said to be readying a massive fleet of automated elec- startups, venture capitalists says Americans are increasingly tric cars for a test program with ride-hailing and academics to promote seeking out fueling locations affiliate Lyft, reported Forbes. Starting in 2018, innovation in robotics, vir- based on the quality of the food GM intends to deploy thousands of auto- tual and augmented reality, mated Bolt hatchbacks in what could be the machine learning and arti- associated with the gas station.” largest such test fleet in operation. • Dunkin' ficial intelligence. The com- Donuts recently announced the signing of pany said the goal of Store No. 8 is to multi-unit store development agreements (22 percent) say they used the rest room. have a fast-moving, separate entity to with two franchise groups to develop a total Overall, 8 percent say they bought a identify emerging technologies that of 12 Dunkin' Donuts restaurants in North sandwich or meal, and that percentage can be developed and used across Wal- Carolina over the next several years. • Pennsyl- jumps to 13 percent for younger con- mart. vania-based c-store chain Wawa recently sumers ages 18 to 34. began rolling out the mobile ordering feature on its app, allowing customers to get their made-to-order hoagies—and basically Gas Stations Chosen Verifone Security Breach any other menu item normally available on Based On Food Quality Electronics payments company Ver- the touch screens in Wawa stores—much Americans are increasingly seeking ifone Systems is investigating a breach of faster, reported PhillyVoice. • New research out fueling locations based on the quality its internal networks that appears to have from the CVS Health Research Institute states that the company’s decision in 2014 to re- of the food associated with the gas sta- impacted a number of gas stations and move tobacco from its pharmacy stores has convenience stores running its point-of- tion, according to new national survey reduced cigarette purchases nationwide. Find- results released by the National Associa- sale card terminals, reported Reuters. ings also show that those who had purchased tion of Convenience Stores. While sur- According to KrebsOnSecurity, which continued on page 66 vey results show that gas price is still the continued on page 72

64 AVANTI MARCH | APRIL 2017 Register for the 2017 NCASEF www.ncasef.com continued from page 20 Convention

Legislative Update continued from page 64 the Supreme Court to reject the appeal ated with selling lottery tickets. He has cigarettes exclusively at without a hearing. They said the accord introduced a bill, S.5108, to achieve that. CVS Pharmacy were 38 was unfair because it stripped them of There are 17,700 licensed New York percent more likely to stop buying them al- their right to sue Visa and MasterCard Lottery agents statewide, and together together. • Fast-food chain Wendy's plans to over fee practices that weren’t addressed these small businesses have helped install self-ordering kiosks at about 1,000 locations by the end of the year, reported the in the settlement. build New York Lottery into a $9.6 bil- Associated Press. A typical location would lion-a-year enterprise, NYACS said. Proposal To Increase have three kiosks, and higher-volume restau- NY Lottery Commission NY Surcharge Ban Must rants will be given priority. • Swisher Interna- Not Violate Free Speech tional Inc. recently announced the New York State Senator Tony appointment of Bill Dunn to Vice President, In- Avella recently spearheaded a bipartisan The U.S. Supreme Court recently dustry Relations. Formerly Vice President of effort to help offset the rising costs of ruled that a New York law intended to Field Sales, Bill has held more than 10 differ- New York Lottery retailers by ad- crack down on credit card ent positions of increasing responsibility justing their compensation rate surcharges must not violate within the organization spanning a 35-year for the first time in 50 merchants' free speech career, the company said. • Allstate Insur- years, the New York As- rights, reported USA ance recently released a new account-specific sociation of Conven- Today. In a unanimous skill for Alexa devices like the Amazon Echo ience Stores (NYACS) but narrow ruling by Chief that allows customers to ask Alexa for help announced. Backed by a Justice John Roberts, the court finding the due date on their next bill or what bipartisan group of his Senate said the law can be challenged the minimum amount due might be. For gen- colleagues, Senator Avella aims in lower courts based on whether eral consumers, Alexa can assist with locating to increase the retailer's commis- it restricts the way merchants adver- the nearest Allstate agency office by zip code. sion from the current 6 percent of tise prices. That bolsters the effort • Each industrial robot introduced between the face value of tickets sold to 8 percent mounted by New York merchants who 1990 and 2007 led to the loss of 6.2 jobs, reveals a paper from the National Bureau of in order to reflect higher costs associ- argued that they should be able to re- Economic Research. Wages also saw a slight cover the costs of “NY State Senator Tony Avella aims to increase the re- drop of between .25 and .50 percent per credit card swipe 1,000 employees when one or more robots tailer's commission from the current 6 percent of the fees by posting the was added to their workforce. • MillerCoors face value of tickets sold to 8 percent in order to reflect cash price of a prod- and IPG Media Lab have partnered with on- higher costs associated with selling lottery tickets.” continued on page 68 demand alcohol delivery service Drizly to develop a branded Amazon Dash button for 500 customers, as well as an Amazon Alexa skill with the trigger phrase “Start Miller Time,” reported MediaPost.com. • Bottled water surpassed carbonated soft drinks in 2016 to Play The Name Game! become the largest beverage category by vol- Look carefully at each page in this issue. ume in the U.S., according to the Beverage Somewhere in this magazine a line is hidden that Marketing Corporation. Last year, total bottled water volume grew nearly 9 percent and contains the words $Name Game Winner + Americans consumed an average of 39 gal- person’s name + city$. If you find this line, and lons of bottled water compared to 38.5 gal- it contains your name, call AVANTI’s Offices at lons of carbonated soft drinks. • With retail foot traffic falling 12.3 percent in the last 215 750-0178 before the next magazine is published, two months of 2016, and online sales rising and win this issue’s total. NCASEF Members only. continued on page 70

66 AVANTI MARCH | APRIL 2017 Register for the 2017 NCASEF Convention www.ncasef.com continued from page 66 Legislative Update uct and a surcharge for buying on owners in order to pay for a $52 credit—but not the higher credit of Representatives, any of the state’s billion infrastructure plan, re- card price. 11,234 restaurants, bars, convenience ported The Hill. Supporters of the bill said Under the state's law, a merchant can stores or grocery stores with an “R” li- the average driver would pay about $10 advertise a $10 cash haircut and a $10.30 cense from the Liquor Control Board more per month in fuel taxes, and most credit card haircut, or it can advertise the could buy a $2,000 permit to sell up to drivers will pay between $25 and $50 an- $10.30 price and a cash “discount.” But it three liters—usually four bottles—of hard nually to license vehicles valued under cannot post only the $10 price and a 3 liquor to a consumer. A percent or 30-cent “In NY state a companion bill was intro- “California legislators are close to passing a bill credit card surcharge. duced in the state Senate by that raises gas taxes by 12 cents a gallon and merchant can The state Court of Pennsylvania Sen. Randy creates a new annual fee for vehicle owners.” advertise a $10 Appeals upheld the Vulakovich. Governor Tom cash haircut and law as a price regula- Wolf said he does not sup- a $10.30 credit tion, but Roberts said port this measure, at least until the state $25,000. Most of the money generated by card haircut, or it regulates speech has fully implemented the liquor reforms the gas tax hike, about $33.7 billion, will advertise the instead, since all the of last year. pay for a backlog of infrastructure repair $10.30 price and prices are the same. projects that has grown to $130 billion. Kansas Allows Stronger a cash ‘dis- He sent the case back Beer In C-Stores WV Gov Proposes Tobacco count,’ but it to a federal appeals & Soft Drink Taxes cannot post only court to be tested The governor of Kansas recently the $10 price under the First signed a new law allowing the sale of After lawmakers pushed back on his and a 3 percent Amendment. “The stronger beer in convenience stores in original 2017-18 West Virginia budget or 30-cent credit law tells merchants two years, reported the Wichita Eagle. plan, Gov. Jim Justice unveiled in late nothing about the February a second version that reduces card surcharge.” The State Legislature approved the meas- amount they are al- ure earlier in April. It’s a significant shift proposed increases in sales taxes, gas lowed to collect from a cash or credit card in the way the state regulates alcoholic taxes and business gross receipts taxes, payer,” Roberts wrote. “Sellers are free to beverages, according to the article. The and makes up some of the difference with charge $10 for cash and $9.70, $10, bill was touted as a compromise between higher tobacco taxes and a tax on sugary $10.30 or any other amount for credit. big box stores and some liquor stores in soft drinks, reported the Charleston What the law does regulate is how sellers response to changes in alcohol laws in Gazette-Mail. Justice announced his may communicate their prices.” neighboring Colorado and Oklahoma. “Better Health Initiative for West Vir- PA Bill Would Allow The House substitute for SB 13 will allow ginia” on February 27, which would im- C-Stores To Sell Hard convenience and grocery stores to sell pose a 1-cent-per-ounce tax on sugary soft drinks to raise $85 million, and a 50- Liquor beer with an alcoholic content of 6 percent by volume starting in April 2019. cent-per-pack increase on cigarettes to A Pennsylvania lawmaker recently Those stores now can sell only beer with raise $47.8 million. introduced a bill in the state legislature an alcoholic content of 3.2 percent by Justice said health advocates had that would allow convenience and weight. The change does not include convinced him the increases would not grocery stores to sell hard wine. only raise revenue, but would help im- liquor in addition to wine prove the health of residents. The soda California To Increase and beer, reported tax would not apply to sugar-free bever- KDKA-2 CBS Pittsburgh. Gas Tax ages, and would not change the 1-cent Under the bill proposed California legislators are close to soft drink tax that helps support the West by Rep. Mike Reese, passing a bill that raises gas taxes Virginia University School of Medicine. which now awaits a by 12 cents a gallon and creates Justice’s new plan also retains increases in vote by the full House a new annual fee for vehicle continued on page 70

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continued from page 66 wholesale liquor prices and beer taxes because Indiana would lose its price 12.6 percent, many to raise $5.6 million for tourism pro- advantage over neighboring states. An malls are adding motion. extra dollar a pack would put Indiana Amazon's yellow lockers as a way to attract Conn Legislature essentially even with Illinois and more customers, reported the Philadelphia Considers Raising Michigan, and 40 cents more expensive Daily News. • Sandwiches, burgers and other than Ohio. Tobacco Age handheld items account for nearly one out of But the Indiana Chamber said every four dollars spent in the foodservice The Connecticut General Assem- smoking drives up business health channel in 2016, totaling just over $205 billion bly is considering a bill that would raise costs by $3 billion a year, with another in sales, reveals a new Technomic study. • Wal- the legal age for buying and using to- $3 billion evaporating due to lost pro- mart Canada recently launched grocery home bacco products from 18 to 21, reported ductivity. Senate Republicans have delivery for customers in the Greater Toronto WNPR News. The been skeptical of the cigarette tax hike, Area. Customers living within select regions in General Assembly's warning you can't assume it'll keep Toronto, Etobicoke and Mississauga can now have their grocery orders delivered right to “Connecticut Public Health Com- bringing the same amount of money. their door. • A bill introduced recently in the and North Car- mittee heard public NC Bill Seeks To Raise Colorado Senate would open the door for olina would be testimony recently on Tobacco Purchase Age home-delivered recreational and medical the third and the bill. A 2015 study marijuana in the state. • Swisher Interna- four states na- by the Centers for A new bill in the North Carolina tional recently announced the expansion of its Disease Control and legislature would raise the minimum tionally to raise international sales team to include Stephan Prevention reported age to purchase tobacco and nicotine Qarimi as an International Market Manager the smoking that 75 percent of all products to 21, reports the North State and Director of Travel Retail. Qarimi will focus age to 21.” Americans, and 70 Journal. Current state law is 18 years on marketing Swisher products that are cur- percent of all smokers old. The bill also includes raising the rently distributed in more than 60 countries as support raising the age limits on cigarette wrapping papers part of the company’s global vision. • Jaguar age to 21. If the bill becomes law, Con- and vapor products. It makes an excep- and Shell have teamed up to launch the necticut would be the third state be- tion for people age 18 to 20 who are world’s first in-car payment system. Owners hind California and Hawaii to raise the serving in the armed forces. According of the Jaguar XE, XF and F-PACE in the United age of tobacco sales to 21. to the article, lobbying efforts to raise Kingdom can now use PayPal or Apple Pay via their car’s touchscreen to pay for fuel at Shell Indiana C-Stores & Law- the minimum age for tobacco began in earnest in 2005 and have led mostly service stations. • The size of the average gro- makers Clash municipalities to enact higher age lim- cery store has grown by more than 7,000 Indiana convenience stores its, with 220 cities passing square feet in the past 30 years, and the additional perimeter square footage has been filled are trying to block a proposed them across the country. with a wider variety of fresh items such as $1 per pack cigarette tax Hawaii and California local produce, organic options and more ready- hike, reported WIBC- raised the tobacco age made and pre-cut items, reported Fortune. • C- TV. House Republicans' to 21 in recent years. Store chains QuikTrip and Sheetz have ranked tax proposal was the main Currently in North Car- onto the 2017 Fortune 100 Best Companies focus of attention as a Senate olina, a law passed in 2013 to Work For list, with QuikTrip coming in at #68 committee conducted the first to ensure statewide unifor- and Sheetz landing at #87. This list, now in its of seven hearings on a new state mity prevents local 20th year, recognizes companies that have ex- budget in early March. The In- governments from ceptional workplace cultures. • GPM Invest- diana Grocery and Conven- making their own ordinances ments LLC recently signed an agreement to ience Store Association warned that governing the sale of tobacco and to- acquire Mountain Empire Oil Co. Inc., operat- would be “devastating” to its members bacco-derived products. continued on page 74

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Midwest FOA Donates Funds first reported on the breach, a “source said his employer shared with the card To Chicago Police Federation brands evidence that a Russian hacking The Midwest FOA, with the guid- group known for targeting payment ance and support of Charlene Brandt providers and hospitality firms had com- (Regional Manager of Governmental promised at least a portion of Verifone’s Affairs, Heartland Zone), represented internal network.” KrebsOnSecurity also by its president Jim Bayci and Board stated the source said “Visa and Master- Card were notified that the intruders ap- member Joe Rossi, presented the peared to have been inside of Verifone’s Chicago Police Federation with a network since mid-2016.” $10,000 donation on April 5, 2017. 7-Eleven's “Working with Chicago Law Enforcement Special Luncheon” was hosted at the Palmer House Hotel. The Heartland Zone asked for Supermarkets support from the Zone FOAs to match SEI's $5,000 donation. The MWFOA proudly matched the $5,000 Expanding Delivery and, along with SEI, presented a $10,000 check to the Big food retailers are expanding grocery delivery services, hoping to dissuade Chicago Police Federation. customers from defecting to online rivals Just days after the check presentation, four stores in downtown like Amazon, reported Market Watch. Chicago were robbed. Within three days, the Chicago Police Depart- Grocery heavyweights including Wal- ment, working closely with the local 7-Eleven team, solved the rob- mart, Kroger and Meijer are broadening beries and delivery areas across the country and the arrests ways in which customers get were made. “About 20 per- their groceries. The Mid- cent of shoppers Meijer recently west FOA went online to started delivering encourages groceries in the all fran- purchase gro- six Midwestern chisees to ceries in 2016, states—Illinois, support more than half Indiana, Ken- your local of those on tucky, Michigan, police de- Ohio and Wis- partments. Amazon Prime consin—where its and 22 percent 230 stores are lo- at traditional cated. About 20 percent of shop- grocers.” pers went online to purchase groceries in 2016, compared with 16 percent in 2015. However, more than half of those online grocery shoppers turned to Amazon Prime while 22 percent turned to traditional grocers' online offerings, according to data from Nielsen. continued on page 74

“Excentus’ survey report found 37 continued from page 70 Philadelphia Soda percent of consumers prefer fuel ing as Roadrunner Tax Reduces Sales discounts over credit card rewards, Markets, including Philadelphia’s new tax on all 92 convenience stores with fuel sales sweetened beverages is already coupons, retailer points and instant and seven quick-service restaurants located taking a toll on drink distribu- in North Carolina, South Carolina, Tennessee discounts at the cash register.” and Virgini, reported Convenience Store Deci- tors and grocers, with some re- the number of cooler doors, to a total of 34, sions. • Overall domestic retail salesfor reporting sales drops of as much as 50 percent, frigerated coffee creamer products in 300 traditional Dollar General locations reported Bloomberg. Philadelphia became approached $2.5 billion in 2015—an in- the first major U.S. city to implement a soft- this year. The expansion is based on knowl- crease of more than 4 percent, reveals a new drink tax when it approved a levy of 1.5 edge obtained from the conversion of the study by market research firm Packaged cents per ounce on sweetened beverages in Walmart Express stores that it had acquired Facts. The share of households consuming June, almost doubling the price of 12 packs and converted to the DG Plus format, which three or more containers per month is at a of cans and two-liter bottles. features fresh meat and produce. In addi- five-year high of 12 percent. • Dollar Gen- Canada Dry Delaware Valley—a local tion, Dollar General plans to begin testing eral has announced plans to build the com- distributor of Canada Dry Ginger Ale, an assortment of fresh produce in certain lo- pany’s 16th distribution center in Sunkist, A&W Root Beer, Arizona Iced cations that it is remodeling, and open about Amsterdam, New York, located in Mont- Tea and Vita Coco—said business fell 45 1,000 stores in 2017—including about 160 gomery County. The company said the project is expected to create430 new jobs, and percent in Philadelphia in the first five smaller-format stores of 6,000 feet or less, which have proven to be successful over the construction on the facility should begin in weeks of 2017, compared with the same late spring 2017 with a planned completion past two years. It expects to have 250 such period last year. Total revenue at Brown’s date in fall 2018. • Pharmacy Chain CVS re- Super Stores, which operates 12 ShopRite locations by year-end. cently announced it will fund $10 million in and Fresh Grocer supermarkets, fell 15 new and expanded partnerships and pro- percent at its six retailers in the city. In grams to launch the second year of Be The March, Pepsi pulled 2-liter bottles and 12- Target Redesigns Stores First, the company's five year, $50 million packs of its products from Philadelphia For Convenience commitment to help deliver the nation's grocery store shelves over the city's new first tobacco-free generation. •Chick-fil-A, Target is redesigning its stores in order tax, saying it wants to offer products and Chipotle Mexican Grill, and Hardees de- to help customers who need to dash in for package sizes working families can better liver the best customer experience in the small grocery items get out quickly, re- afford, reported the Associated Press. fast food industry, according to the 2017 ported the Associated Press. The redesign Temkin Experience Ratings. • White Castle will also encourage those who want is the first and only fast food organization in Dollar General to wander the aisles to linger. The the United States to become an official part- “Target is new layout will feature a separate ner ofUSA Luge and title sponsor of the off- Expands Fresh entrance and 10-minute parking for season recruitment program—the White redesigning shoppers looking to pick up an on- Castle USA Luge Slider Search. • Now even Produce its stores line order or some essentials. New the tradition-bound funeral industry of- Discount chain Dol- center aisles will be curved rather fers one-stop services with a simple and with a convenient online platform: Taiwan-based lar General plans to greatly than squared off, to inspire people separate 51 People Commitment, an online “conve- increase the number of to explore. cooler doors in many of its entrance for nience store” for end-of-life services and the The first of the redesigned stores very first in the world utilizing mobile in- stores and expand the of- customers will open in suburban Houston this fering of fresh produce to ternet technology, officially went online fall. About 40 more stores will get on March 15. • About a third of 45- to 65- additional locations, re- looking for small gro- the remodel treatment by October, year-old Americans say they’ll work ported Supermarket using the Houston prototype as a part-time in their golden years and 4 News. The company said cery items.” template. More than 600 of Target's continued on page 80 it would more than double continued on page 76

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1,800 total locations are scheduled for up- “Circle K parent company dates over the next three years. It expects Couche-Tard’s Third the remodeled stores to see a 2 percent to Alimentation Couche- 4 percent sales bump. The remodeling is Quarter Earnings Rise Tard reported higher net a key part of Target Corp.'s strategy to win Circle K parent company Alimenta- back shoppers and rev up sales. tion Couche-Tard recently reported net earnings of $287.0 million for the third quarter of SPECIAL NACS fiscal 2017.” Membership Offer earnings of $287.0 million for the third quarter of fiscal 2017 compared with FOR NCASEF MEMBERS $274.0 million for the third quarter of The National Association of Conven- fiscal 2016. The company also reported ience Stores (NACS), in partnership with that same store merchandise revenues the National Coalition of Associations of increased -by 1.9 percent in the U.S. and 7-Eleven Franchisees, is now offering a by 2.5 percent in Europe, but decreased special membership to NCASEF members by 0.9 percent in Canada. Merchandise at the reduced price of $40—an 80 and service gross margin decreased by percent discount off of the starting mem- 0.4 percent in the U.S. to 32.9 percent, bership rate of $200. The NCASEF NACS and by 1.4 percent in Europe to 42.5 per- Membership Program offers industry-spe- cent. In Canada, gross margin increased cific programs and services, as well as tra- • NACS Daily News e-newsletter. by 1.4 percent to 33.8 percent. Couche- ditional association benefits to help you • Potential for consideration as NACS Tard said same store gasoline volumes compete and succeed. The benefits of the Board or Committee Member. special NCASEF NACS Membership Pro- grew 2.8 percent- in the U.S. and 1.8 per- • One copy of NACS Magazine (monthly gram include: cent in Europe, but decreased by 0.8 per- publication). • Discounts to all NACS events. cent in Canada. The company further • Congressional and federal agency repre- reported that 278 sites acquired from • Discounts on all NACS training, educa- sentation through the NACS Government Imperial Oil were successfully integrated tional, and operational products. Relations team. into its network in Ontario and Quebec • Access to NACS Help Desk, an informa- • And more! during the third quarter. tion resource that provides answers to re- To sign up, all you need to do is com- tailer member questions and facilitates plete the one-page membership applica- greater industry connections. tion distributed by your FOA and scan and Massachusetts Gas • Full voting rights as a NACS Domestic e-mail, fax, or mail it to NACS. Retail member. Stations Disappearing U.S. Census Bureau figures reveal If you have questions that the number of Massachusetts gas about NACS membership stations dropped 12 percent between for NCASEF members, 2005 and 2014, reported the Boston please contact NACS Vice Globe. In Greater Boston, the drop was President of Member Services Michael Davis at 14 percent. There are several reasons be- [email protected] hind the decrease. Some mom-and-pop or (703)-518-4246. You operations have been squeezed out by may also contact NACS bigger suburban stations. Also, stricter Retail Membership Man- environmental standards have prompted ager, Eboni Russell, at [email protected] some stations to close rather than pay for or (703) 518-4271. expensive equipment upgrades. But per- continued on page 80

76 AVANTI MARCH | APRIL 2017 MARCH | APRIL 2017 AVANTI 77 Register for the 2017 NCASEF continued from page 76 Convention www.ncasef.com Intere$ted In $aving Money By By Bill Huffman On Your Expen$e Line? Co-Chair, NBLC Vice President, Greater Oregon FOA April 18 has come and gone, and most of us had to write “When you take forms to your CPA/accountant, a check to Uncle Sam to pay our taxes. Are you interested and the amount generated will in reducing the amount you pay on Tax Day? advantage of the be deducted from the income The United States Government wants to give YOU tax WOTC program, tax owed to the IRS. credits that could be used to reduce the amount of in- you may receive What is the cost of this come tax you pay. When you take advantage of the service? Neon only charges Work Opportunity Tax Credit (WOTC) program, you may tax credits that you for credits generated by receive tax credits that can be used to offset income tax can be used to your state. So if you sent in 20 due to the IRS. applications and only 5 of offset income tax How does this program work? New employees that are them generated credits, you qualified within 28 days of hire can generate these credits. due to the IRS.” will only pay for those five. To qualify employees, SEI has engaged a company, Neon Neon charges 10 percent of Workforce Technologies, Inc.—also known as TaxBreak—to the tax credits you receive. simplify the process. Once you have completed a power of This is a rock bottom cost within this industry. attorney giving Neon the ability to research your payroll Since this is a federal program that is administered by records through SEI, the state governments, some of the credits take a long all you have to time to generate. However, the credits are usable for up to do is have your twenty years. new hires fill How much can you save? While every store will be dif- out IRS Form ferent, my two stores have consistently generated in ex- 8850 and a cess of $13,000 a year for the last five years. As we face tax credit operational costs that never go down, this is a way to information form. save some money, and best of all the time it takes is very You will then fill out minimal. two lines of infor- Keep in mind that this is not a quick fix. In March of this mation about year, I received additional credits for tax years 2011, 2012, the employee and 2014 that total over $8,000. This amount may be used and mail this infor future tax expenses, or I have the option of redoing my tax returns for those years. “SEI HAS ENGAGED A COMPANY, NEON WORK- Only 6 percent of franchisees are taking FORCE TECHNOLOGIES, INC.—ALSO KNOWN AS advantage of this program! If you are part of the 94 percent who are not, I urge you to TAXBREAK—TO SIMPLIFY THE PROCESS.” sign up TODAY! All of the forms are on the formation to TaxBreak. We now also have a portal on the ISP, and help is available from TaxBreak at (256) 399- ISP in the Hire Right section, so if you choose to automate 0236. If I can be of any help, please email me at coos- this process, you have that option. [email protected], I will do my best to assist you. Once TaxBreak receives the information, the employee is vetted and applications are sent to your local state gov- TAKE ADVANTAGE OF WOTC BILL HUFFMAN ernment for approval. When approved by your state, Neon Look for the WOTC Taxbreak CAN BE REACHED AT will send the information back to you. You then take the forms on your ISP, or call (540) 290-0331 OR TaxBreak at (256) 399-0236. [email protected]

haps the main factor for the decline: the tional products. The result: healthy is the continued from soaring value of real estate. Especially in new normal. page 74 urban settings, land has become so valu- Among the findings of the study: able that it has enticed many station • 78 percent of Millennials describe bet- owners to sell, given that the profit mar- ter-for-you snacks as tasting the same or percent aim to have a full- gins of selling fuel tend to be slim. better than traditional packaged snacks. time job, changing the very meaning of retire- • 64 percent of Millennials, more than ment, according to an Ipsos/USA TODAY any other generation, believe that fewer survey. • Between 2005 and 2014, Americans Millennials Driving ingredients mean a snack is healthier. In consumed 19 percent less beef, avoiding an addition, 79 percent of Millennials said estimated 185 MMT of climate-warming pollu- Better-For-You Snacking that understanding all the ingredients in- tion or roughly the equivalent of the annual Millennials have been the driving creases their level of trust in a packaged tailpipe pollution of 39 million cars, according to a new study by the Natural Resources De- force behind the growth of the better- snack. for-you snack category, reveals a new na- fense Council. • Environmentally-responsible • More than any other generation, Mil- dry cleaning franchise OXXO Care Cleaners re- tional study by Amplify Snack Brands, lennials will try a better-for-you snack Inc. and the Center for Generational Ki- cently launched its OXXO Mobile app, which based solely on an online rating, allows customers to track information about review, or social media post. the status of their orders, request pick-up and “Better-for-you choices, driven •. The majority (69 percent) of delivery, and locate a nearby OXXO Store, Millennial moms say their kids among other options. • Mama Gaia—a fast by millennials, are now sought understand that some snacks are casual, organic, vegetarian restaurant con- aer by a mainstream audience, healthier than others and 55 per- cept—recently opened for business in Mem- according to a new report.” cent say their kids are more likely phis, Tenn. The couple behind the pioneer to choose a better-you-snack concept was inspired when they found a lack over another packaged snack. of restaurants offering affordable organic and vegetarian menu choices that are served netics. Thanks to these health conscious quickly. • Domino's Pizza recently celebrated and influential consumers defining both Amazon Delays Opening the grand opening of its 14,000th store in Cy- how we snack and our expectations of berjaya, Malaysia, outside of the nation's those snacks, better-for-you choices are Of Automated C-Store capital of Kuala Lumpur. • Museum of Ice now sought after by a mainstream audi- Amazon is Cream recently claimed downtown Los Ange- les’ burgeoning art district as its highly antici- ence, the report states. The national re- postponing the pated second location. Open from April 22 search revealed that healthier snacks opening of its until May 29, interactive highlights include a have become widely available across the Amazon Go convenience store because of “banana split” comprised of ten thousand “ba- country, break the income barrier, and technical issues, reported Business Insider. nanas, a melted popsicle jungle, and more. • are being held to the same standards of The cashier-less convenience store Alexandria-based startup ThreadRobe has in- universal taste appeal as their conven- was scheduled to launch in Seattle at the troduced an automated piece of furniture continued on page 82 that eliminates the need to fold, hang, and put away your laundry. Users place loads of clean clothing from the dryer directly into the Share Your Experience and Expertise automated wardrobe's bin, which then sepa- Do you have a store experience, some operational expertise, or thoughts rates, identifies and stores them. • Bank of the about the 7-Eleven system you would like to share with your fellow West recently announced five mobile wal- storeowners? Avanti Magazine welcomes articles from franchisees let options for its customers, making it one interested in communicating their ideas, knowledge, suggestions, of the few U.S. banks to offer access to all five opinions, etc. to the franchisee community at large. Please contact major mobile wallets: Apple Pay, Android Pay, Sheldon Smith at [email protected] or 215-750-0178 if you Samsung Pay, MasterPass by MasterCard, and would like to contribute an article to Avanti. Microsoft Wallet.

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continued from page 80 Convention www.ncasef.com end of March, but the payments technol- in favor of snacking, re- tend to be consumed during an ogy needed to replace employees at ported Supermarket News, occasion where nourishment is checkout is not working properly. The citing the Hartman Group’s among the goals, while snacking technology uses cameras, sensors, and Future of Snacking 2016 for optimization or to manage algorithms to track what customers pick study. Hartman Group out- alertness and focus can include up for purchase. However, it reportedly lines three main drivers of drinking a cup of coffee. Snacking malfunctions when more than 20 people snacking occasions, which for pleasure, meanwhile, is im- are in the store. In order to make this a tend to overlap: snacking plicit for a majority of eating oc- worthwhile investment for Amazon, the for nourishment to help casions since people want to eat technology will need to be able to sup- meet daily sustenance (56 percent of all snacks that taste good. port large crowds, the article states. snacking); snacking for optimization to help fulfill mental and physical perform- ance (34 percent); and snacking for Young Men Are Most Likely Consumers Eating pleasure or to fulfill emotional desires for To Grocery Shop Online enjoyment, craving and comfort (49 per- Although online grocery shoppers More Snacks cent). can be found across all demographic Of the vast majority of Americans The Hartman group study reveals groups, they are more likely to be (91 percent) who snack multiple times that yogurts, granola bars, whole fruits younger men, ages 18-44, according to a per day, 8 percent forgo meals altogether and vegetables, water and smoothies continued on page 84 Register for the 2017 NCASEF Convention www.ncasef.com continued from page 82

recent study by The NPD Group. Ama- For these reasons, the report states, on- their marketing, products offerings, zon Prime members and young adults line shoppers are disproportionately men services, and even store designs just to are other groups more likely to grocery who are looking to minimize physical garner even a semblance of consumer shop online, finds The NPD Group re- trips to the store. loyalty,” said David Sprinkle, research di- port, “The Virtual Grocery Store.” Gro- rector, Packaged Facts. cery shopping online appeals to those who find grocery shopping a necessary Key Trends Shaping evil and many of those who feel that way Grocery Retailing Mobile Ordering are men, according to the NPD study. There are a number of trends that Double-Digit Growth Since many younger adults are de- are putting pressure on food retailers of The use of mobile apps, text mes- laying marriage and the formation of all stripes, and three of the most promi- sages, and the internet to order food families, and many Boomers are becom- nent are the incursion of e-commerce from a restaurant or other foodservice ing widowers, more than 40 percent of onto the food retailing landscape; the outlets grew by 18 percent last year and primary grocery shoppers are men and evolution and expansion of contactless now accounts for 1.9 billion foodservice 60 percent of men, 18 to 44, have pur- payment options; and the rise of the visits, reports The NPD Group. The chased groceries online. NPD has found smaller store formats, reveals a new re- global information company’s study re- that men tend to make grocery shopping port by market research firm Packaged veals that, while currently more orders a mission and spend less time in brick Facts. “Food retail is evolving. The cus- are placed using websites, orders placed and mortar stores compared to women. tomer is king, and perhaps more than with a mobile app are growing more Men will also buy fewer items on each anytime in history, the consumers are strongly. Fifty percent of digital orders trip and will likely leave the store if they firmly in control. Competition from come at dinnertime, and 35 percent of can’t find an item. Online grocery shop- multiple channels is unrelenting, and re- digital ordering includes parties with ping is the answer for men who are look- tailers must be creative and innovative in kids, according to the NPD report. Peo- ing to avoid physical trips to the store. ple under age 35 and those with higher household incomes are among above-av- “Online grocery shoppers are more likely to be younger erage users of digital ordering. men ages 18-44, Amazon Prime members, and young Deals and promotions play an important role in digital ordering, finds

adults, according to an NPD Group report.” continued on page 86 Want to talk to other franchisees? To find the FOA closest to you. Visit www.NCASEF.com to contact any one of the 46 local Franchise Owner’s Associations nationwide. Want to talk to someone at the national level? Call the NCASEF Vice Chairman in your area: Nick Bhullar, Vice Chairman, Rehan Hashmi, Vice Chairman, Vice President, The National Coalition Board Member, So. California FOA Alliance Of 7-Eleven Franchisees has Franchise Owner’s [email protected] [email protected] 818.571.1711 847-845-8477 Association member Romy Singh, Vice Chairman, National Office organizations in all 33 states President, Eastern Virginia, FOA [email protected] in which 7-Eleven operates. 757-506-5926 831-426-4711 [email protected]

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NPD. When consumers order digitally, ability to pay with mobile boosts cus- special (39 percent), warmth (33 per- they are twice as likely to order on a deal, tomer satisfaction scores and encourages cent) and happy (30 percent). What’s and that deal is usually a coupon. guests to visit for reasons related to loy- more, over one quarter (27 percent) of Twenty-nine percent of all digital orders alty, reports NPD. Americans consider seasonal flavors to used a coupon. Other top deals used be nostalgic. were discounted price, daily special, and The Mintel research further reveals combined item special. Additionally, the Americans Want Seasonal that 43 percent of American consumers Ingredients Year-Round prefer seeing seasonal ingredients featured in coffee drinks, rising to more “e use of mobile apps, While Americans wait all year in an- than half (53 percent) of Millennials and ticipation for their favorite seasonal-in- text messages, and the in- 57 percent of iGeneration consumers. spired food and drinks, new research ternet to order food from a Seasonal flavors aren’t just limited to from Mintel reveals that nearly seven in non-alcoholic beverages, however, as restaurant or other food- 10 (67 percent) consumers enjoy being American consumers are also interested service outlets grew by 18 able to consume specific seasonal ingre- in seeing seasonal ingredients featured in dients year-round. The study also shows percent last year and now beer (27 percent), craft beer (23 percent) that seasonal flavors create an emotional accounts for 1.9 billion and dinner/happy hour cocktails (22 connection with consumers, such as percent). foodservice visits.” evoking notions of comfort (39 percent),

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The 96-month wind energy agreement, which impacts 425 stores, starts June 1, SINGLE-ORIGIN COFFEE 2018 and is expected to reduce 7-Eleven's carbon footprint by 6.7 percent while pro- FROM MEXICO viding significant operating expense sav- SEI recently introduced its second sin- ings. SEI said TXU Energy will help it save NEW WOMEN'S FRANCHISE gle-origin coffee, this time from the Chia- even more by providing energy efficiency INITIATIVE COMPETITION pas growing region of Mexico. Rainforest rebate incentives through its TXU Green- Alliance Certified, the new premium, sus- Back program. These incentives will allow In an effort to increase its own number tainable coffee from Chiapas is made ex- 7-Eleven to fund and pilot new energy effi- of female franchisees, 7-Eleven has kicked clusively from beans harvested in the cient technologies that can be used off a franchise give-away contest targeted mountainous highlands of southern Mex- throughout its portfolio of facilities. exclusively to women entrepreneurs. ico, an area known for its dense Last year, SEI outlined steps to reach One deserving woman will be rain forests and ancient measurable corporate social responsibility awarded a 7-Eleven fee- Mayan ruins. Notes of (CSR) goals to reduce its environmental free franchise, a value of “7-Eleven cocoa balance the full- footprint. The company's CSR mission has up to $190,000. In ad- has kicked off a bodied, dark roast, three focus areas—people, planet and dition, 7-Eleven said it which has a smooth, products. SEI said it has already decreased will make a donation franchise give-away clean finish. electricity use in store operations by an es- to the winning contest targeted ex- 7-Eleven coffee timated 21 percent over the past seven woman's charity of clusively to women drinkers' taste prefer- years through projects including installa- choice that aligns with entrepreneurs.” ences continue to shift to- tion of LED lighting, energy management its Project A-Game pro- ward darker, richer flavors, systems and high-efficiency HVAC units. gram, which helps provide the company said. With 100 youth a foundation for success percent Colombian coffee experi- SEI RAISES FUNDS FOR by funding programs focused on educa- encing the fastest growth in its hot beverage tion, fitness, safety and hunger relief. ORLANDO CITY YOUTH SOCCER lineup, SEI introduced the darker roast, The competition is similar to the com- Major League Soccer team Orlando single-origin coffee from Nicaragua last pany’s successful Operation: Take Com- City SC announced that 7-Eleven contin- fall. The new Mexican single-origin coffee mand franchise giveaway for U.S. military ued its support of the Orlando City Youth is bolder still, with roast levels falling be- veterans. Like Operation: Take Command, Soccer (OCYS) program by collecting tween the Colombian and Brazilian Bold this multi-phase competition includes $2,500 throughout the 2016 Major League flavors giving 7-Eleven customers more of meeting company franchising qualifica- Soccer (MLS) season. The funds were a selection in the flavor profiles they like. tions, preliminary interviews, video contest raised through and a final one-on-one interview with 7- MOST TEXAS 7-ELEVENS TO BE “7-Eleven contin- in-store activa- Eleven senior leadership for the top final- ued its support tions and dona- ists. The winner can choose any of the POWERED BY WIND ENERGY of the Orlando tions and will be company's 7-Eleven con- SEI announced it has City Youth Soccer used to support venience stores available signed an agreement with program by col- the OCYS schol- in the continental U.S. TXU Energy to purchase lecting $2,500 arship program, at the contest's cul- 100 percent Texas throughout the which provides mination. The financial re- wind energy for all its 2016 Major winner will be Texas stores located sources to bud- announced in in competitive en- League Soccer ding youth soccer July 2017. ergy markets. season.” continued on page 93

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continued from page 90 players, the soccer club said. The scholar- Buy One-Get One FREE Slurpee ship can cover the cost of registration, drinks—any size, all day, every day dur- equipment, jerseys and more. erational efficiencies with ing the promotion. Available exclu- Throughout the 2016 season, Orlando added systems integration ca- sively at 7-Eleven stores, the featured 7-Eleven stores treated kids 12 and under pabilities that reduces redun- Slurpee flavor during to a free purple Slurpee when they wore dant data entry and increases the BOGO was the first their youth soccer jersey to a participating data integrity. “7-Eleven ever Trolli-branded store. 7-Eleven also offered fans “Plugged needed a RMIS system capable Slurpee flavor—Pineapple Lime. As In” playlists, hosted player appearances and of consolidating our data for ad- part of the first Trolli flavor promotion, supported Magnet Mondays with the vanced reporting and automation 7-Eleven stores also rolled out Trolli Sour Kickin’ Cruiser. to increase our efficiencies. Riskonnect has Brite Sloths gummy candy. During the Buy been able to provide us with the custom One-Get One Free Slurpee drink event, SEI NAMES INCOMM built modules and tools we need to be suc- both the purchased and free Slurpee drinks ‘VENDOR OF THE YEAR’ cessful in supporting our organization,” counted toward the 7Rewards “Buy Six, said Danny Downs, Risk Analyst. Get the Seventh Free” drink offer available Prepaid product and transaction serv- on the 7-Eleven smartphone app. ices company InComm has been named EXCLUSIVE TROLLI SLURPEE Services Vendor of the Year by SEI. This is 7-ELEVEN MEXICO the first time 7-Eleven has given out an FLAVOR CRAWLS INTO award for excellence to any of its services 7-ELEVEN STORES DEPLOYS ORACLE “In March vendors, according to a released statement SEI and Ferrara RETAIL by Incomm. InComm and 7-Eleven have Candy Company's 7-Eleven introduced Oracle recently an- worked together for over 13 years. Trolli brand intro- Pineapple Lime, the nounced that 7-Eleven “Our customers rely on 7-Eleven for a duced another Weirdly first-ever Trolli- Mexico S.A. imple- wide variety of prepaid products,” said Jack Awesome collabora- mented Oracle Retail Stout, 7-Eleven Vice President of Merchan- branded Slurpee tion—this time featur- to simplify operations dising. “Our long-standing collaboration flavor, exclusive to ing sloths, an exclusive and facilitate the cus- with InComm has not only allowed us to Slurpee flavor, Weirdly 7-Eleven.” tomer experience. 7-Eleven meet those prepaid needs, but it has also Awesome straws and a free Mexico operates 1,950 conven- empowered us with the innovations that offer. In March 7-Eleven introduced ience stores supported by 8 distribution keep us ahead of our competition. In- the first-ever Trolli-branded Slurpee fla- centers and 18,000 collaborators across 15 Comm's dedication to excellence in the vor—Pineapple Lime—and exclusive to 7- states in Mexico. With the introduction of prepaid category made it a deserving Eleven, Trolli Sour Brite Sloths gummy the new system, 7-Eleven Mexico has given choice for Services Vendor of the Year.” candy. In a nod to Trolli's popular Sour teams the ability to adopt a more aggressive Brite Crawlers, four Weirdly Awesome business strategy to retain and attract cus- SEI GOES LIVE WITH Slurpee straws tomers. The replacement of the technology RISKONNECT were also avail- platform has also addressed an important SEI recently announced that it has able for purchase aspect of 7-Eleven's philosophy: empower- gone live with Riskonnect’s Risk Manage- in select stores for ing store managers to take decisions about ment Information System (RMIS) to a limited time. the quantity and type of product at each power its claims management, policy point of sale, making each store a mix that management and property data collection SLURPEE ‘TWIN-SIES’ fits the reality of their micro market, at processes in the U.S. and Canada. Riskon- 7-Eleven celebrated National Siblings every moment of the day and at special nect RMIS helps companies increase op- Day during the week of April 10-16 with events.

MARCH | APRIL 2017 AVANTI 93 Pennzoil Streamlines Its Look • PB 'N Cones—Sure to be a favorite, it features swirls of creamy peanut butter and The #1 Convenience Store motor oil brand, Pennzoil, is going through a crunchy, chocolate-dipped cone pieces through- redesign that is intended to streamline the look of the entire portfolio of out rich vanilla ice cream, giving this classic fa- high-performing motor oils to reflect the advanced technology inside the vorite a unique twist and added texture. package. Pennzoil is already synonymous with yellow and has chosen to Additional scoopable ice cream new flavors move to an all yellow bottle de- include Rockin' Rocky Road, Monster Cookie Mash, Toffee sign for increased visibility at Brownie Twist and Mint Cookie Crunch, which adds yummy shelf. The labels have been re- fudge swirls and mint chocolate cookie chunks to traditional mint ice vamped to allow consumers to cream. Lastly, Blue Bunny is excited to announce, by popular demand sea- easily find their go-to formula- sonal favorite flavor Cherrific Cheesecake will be available year-round. tion. Each front label is color- For consumers who want a delicious coded for easy navigation treat that's on the across all Pennzoil motor oils lighter side, Blue and features the viscosity grade Bunny is happy to offer Pennzoil has moved to an all yellow bottle front-and-center. On the back flavor additions to its design for increased visibility on-shelf. label, you’ll find a product com- no-sugar-added Sweet parison chart that helps with selecting the right motor oil for the vehicle. Freedom® collection— This, in addition to creating a more unified look across the brand, leads Bunny Tracks and to easy product selection for the consumer at the shelf. But there’s one thing Peanut Butter Party. New Blue Bunny Snacks, PB ‘N Cones and new that remains untouched—the oil inside. The same technologically advanced scoopable ice cream flavors. continued on page 96 motor oils you know and trust are still available, including Pennzoil Synthet- ics made from natural gas. Blue Bunny Dials Exclusive: New 7-Eleven Up the Fun With New 5-Hour Energy Flavor Living Essentials, makers of 5-hour ENERGY shots, recently Flavors unveiled new Fiery Cinnamon Extra Strength 5-hour ENERGY. With Blue Bunny is upping the ante with a new its bold packaging and even bolder taste, Fiery Cinnamon will lineup of products, including personal-sized ice attract new customers and keep them coming back for more. cream Bunny Snacks novelties and several From May through October 2017, Fiery Cinnamon Extra new scoopable ice cream flavors. Strength 5-hour ENERGY shots will be available exclusively • Bunny Snacks—This brand-new per- through 7-Eleven retailers. Two eye-catching displays are sonal-sized treat offers available—a 120-bottle floor (or power wing) display, and a consumers a delicious, 48-bottle countertop display. Either way you choose, you’re sure satisfying, bite-sized por- to re-energize your front-end sales. tion. The unique new for- 5-hour ENERGY is America’s bestselling brand of energy mat combines Blue shots. In fact, it was the first energy shot on the market and Bunny ice cream with continues to lead the field by a wide margin. Why? Because it sweet surprises to cre- works. And unlike most canned energy drinks, 5-hour ENERGY ate four unique fla- shots have zero sugar, zero carbs and are portable, making them Fiery vors: Salted Caramel Cinnamon Extra the favorite of hard working people on the go. Pretzel, Chocolate Strength 5-hour ENERGY For more information about Fiery Cinnamon Extra Strength 5-hour Vanilla Twist, Choco- shots, exclusive at 7-Eleven ENERGY shots, call Dempsey Garrett at 936-321-1857 or your McLane late Chip Cookie and May to October 2017. representative. Cookies 'N Cream.

MARCH | APRIL 2017 AVANTI 95 continued from page 95 Bhuja Snacks Offer coconut water sales. Resealable cap adds convenience and meets active lifestyle needs. McLane UIN 685651, Core Mark 437084. Healthier, Flavorful Alternatives Kraft Introduces New recommended Bhuja Snacks are a New Snack Items combination of wholesome ingredients To respond to changing consumer snacking usage and attitudes, Kraft blended in a secret recipe of all natural spices. is innovating between meal, meal replacement and anytime snacks to Made with timeless recipes, wholesome ingre- provide satisfying meal replacements with quality ingredients. Better for dients,and natural spices, Bhuja Snacks contain Bhuja Snacks, an approved you snack food comsumption has grown 25 percent in the last 10 years with no preservatives, are certified NON-GMO, are healthier snack option. more portable, more protein and more variety leading the growth areas. vegetarian friendly, and have a low Glycemic Index. Available in two vari- For consumers searching for better, nutritional snacking solutions to fit eties via McLane now: within their fast, “hyper” day, serve up these new tasty Kraft items: • Ancient Grain Twists Mix—Fragrant and complex spices contrast • Philadelphia Bagel Chips & Cream deliciously with the wholesome goodness of a special grain blend that is a Cheese Dips—Available in two flavors, Straw- source of Omega-3. berry, and Chive & Onion, this popular Philly snack • Beer Mix—Fragrant spices mingle with peanuts and crispy wholesome comes with crunchy multigrain bagel chips and noodles for a crunchy contrast that's deliciously distinctive. wholesome Philadelphia Cream Cheese perfectly portioned in portable snack cups for an eat-at- New Naked Coconut home or on-the-go snack. SRP $2.19. Water 16.9 Ounce • P3 Protein Plates—Natural cheese, savory meats, delicious nuts and sweet fruit After you’re done working your body into shape, treat it combined for an irresistible small meal. With 40 per- to a tropical getaway with an organic elixir that has cent more protein, P3 Protein Plates will satiate more potassium and magnesium, making it a great beverage demanding snacking needs. Each of four flavors con- for replenishment. With Naked Pure Coconut Water hy- tains a larger serving of protein in a tasty blend of dration never tasted so good. Testing shows that over 50 meat, cheese, nuts and fruit. No artificial preserva- percent of consumers enter the coconut water category tives and conveniently packaged for eating on the with the 16.9 ounce size. With packaging credentials op- go. Available in four different varieties. SRP: $3.99. timized to call attention to organic certification, non- Naked Pure Coconut • Planters P3—Combines fresh roasted nuts, premium- GMO verified, no preservatives, no sugar added, Pure water in new cut lean jerky, and tasty seeds for a delicious snack. Packed 16.9 ounce size. Coconut Water 500 ml accounted for 60 percent of total with protein, fiber, vitamins and minerals, P3 is the snack your customers want to keep them active and going strong. This item is peggable TYLENOL RAPID and shelf stable. SRP: $3.99. Available in RELEASE GELS three varieties.

PROVIDE FAST RELIEF Rapid Release Gel sales will • Oscar Mayer Naturals Plate—A Tylenol Rapid Release Gels (24 count) be 56 percent incremental. Natural blend of feature laser-drilled holes to facilitate fast medicine release and provide meat, cheese and crackers. Con- temporary relief of fever and minor aches and pains, including headache, back- tains no artificial preservatives, ache, minor pain of arthritis, toothaches, and pain due to the common cold. ingredients, or flavors. The meat Thanks to this new technology, 70-80 percent of the medicine is released in 3 components sourced from three minutes. Rapid Release Gel sales will be 56 percent incremental. Cost is $3.30, best-selling Oscar Mayer Natural SRP is $5.99, and Suggested Gross Profit Margin is 45 percent. The 7-Eleven cold cuts. Top consumer claims Plan-o-gram will be available from September to October 2017. continued on page 98

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(Protein, Natural, and No Artificial Preservatives) drive increased purchase in- cents per filter pack of 20. Airio has a low SRP designed to create impulse tent in over 71 percent of consumers. Available in three varieties. SRP: $3.99. sales at $1.99 to $2.19 per pack. Available thru McLane. Introducing Airio—The World's New Blue Diamond Nut Thins Smallest Cigarette Filter In A 2 Ounce There are over 40 million smokers in the U.S. and many of them are Package looking for alternatives or more healthy ways to smoke. Launched in Janu- C-store consumers ary 2017 by Smokey Mountain Chew, the Airio Micro Filter elimi- are seeking healthier op- nates approximately 65 percent of the tar in a cigarette via a tions, so expand your sales unique centrifugal process and is the ultimate in discrete filter- with the healthy, craveable ing. You can see the tar removed as you smoke. Each goodness of America’s #1 Airio Cig Filter works for up to three ciga- gluten-free snack cracker, rettes. Airio comes packed in 20-count now available in a conven- Popular Blue Diamond Nut Thins, now in 2-ounce on-the-go sizes. filter packs and are available in an ient 2-ounce size. Blue Dia- attractive 12-count display. mond Nut Thins Snack Crackers are available in Sea Salt, Cheddar Cheese, Take advantage of the Special and Sriracha flavors and are made with real almonds, gluten free, at an SRP New Airio Intro Offer running now thru Sep- of $1.99. According to the experts, 50 percent of customers are looking for Micro Filters has tember 2017: Buy 10 filter packs healthier foods, and 53 percent would shop in c-stores more often if health- a special intro of buy ier choices were available. Order today: Sea Salt (SLIN 0307347), Cheddar 10 packs and get 2 free get 2 FREE. Costs per 12-count until September. display is $9.00 (net of distributor markup) or 75 Cheese (SLIN 0307348), and Sriracha (SLIN 0307346). FOA Board Meeting Dates

7-Eleven FOAC Members Meeting Midwest FOA Phone: 847-353-9999 November 9, 2017—Board Meeting Phone: 908-232-1336 May 25, 2017 FOA Of Greater Dates for Chicago: August 31, 2017 June 29, 2017 Los Angeles (Co-sponsored with Alliance of 7- September 26, 2017 July 27, 2017 Phone: 909-822-4122 Eleven Franchisees FOA) October 24, 2017 August 25, 2017 May 16, 2017 September 21, 2017—General November 28, 2017 September 28, 2017 June 20, 2017 Meeting Board Meetings October 26, 2017 Aug 15, 2017 Dates for Michigan: November 30, 2017 May 16, 2017 Sept 19, 2017 June 13, 2017—General Meeting December 21, 2017 June 20, 2017 Oct 17, 2017 September 28, 2017—General July 25, 2017 Columbia Pacific FOA Nov 21, 2017 Meeting August 22, 2017 September 19, 2017 Phone: 503-901-1677 Metro New Jersey FOA UFOLINY May 18, 2017—General Members October 12, 2017 Phone: 908-232-1336 Phone: 516-647-4617 Meeting November 21, 2017 June 14, 2017 General Membership Meetings NOTE: February through June meetings August 24, 2017—Board Meeting September 13, 2017 September 21, 2017—General May 23, 2017 will be held at the Upsky Long Island November 22, 2017 June 27, 2017 Hotel in Hauppauge, NY.

98 AVANTI AVANTI 99 MARCH | APRIL 2017 $name game winner Al Haffar, Philadelphia, PA$ MARCH | APRIL 2017 Register for the 2017 NCASEF Convention www.ncasef.com foa events continued from page 102 San Diego FOA Vendor Midwest FOA/Alliance Appreciation Event of 7-Eleven Fran- National Coalition AleSmith Brewery chisees FOA Illinois NCASEF Affiliate Meeting San Diego, California Holiday Show Gaylord Opryland Resort & September 7, 2017 Chicago O’Hare Marriott Convention Center Phone: 619-713-2411 Chicago, Illinois board Nashville, Tennessee November 1, 2017 October 30-31, 2017 UFOLINY Golf Phone: 847-971-9457 meetings Tournament National Coalition Baiting Hollow Golf Club 7-Eleven FOAC National Coalition Board of Directors Baiting Hollow, New York Holiday Party/ Board of Directors Meeting September 7, 2017 Trade Show Meeting Gaylord Opryland Resort & Phone: 516-647-4617 (venue to be announced) Marriott St. Louis Grand Convention Center November 16, 2017 St. Louis, Missouri Nashville, Tennessee Southern California Phone: 847-353-9999 May 3-5, 2017 November 1-3, 2017 FOA Charity Golf Tournament Midwest FOA National Coalition Industry Hills Golf Club Michigan Holiday Show Board of Directors Industry Hills, California (venue to be announced) Meeting September 20, 2017 December 6, 2017 Caesars Palace Las Vegas Hotel Phone: 626-255-8555 Phone: 847-971-9457 Las Vegas, Nevada Delaware Valley FOA UFOLINY Holiday Party July 16-17, 2017 Annual Trade Show (venue to be announced) Caesars Palace Atlantic City December 7, 2017 Phone: 516-647-4617 Pacific Northwest FOA Metro New Jersey FOA Atlantic City, New Jersey Holiday Party Holiday Party September 28, 2017 (venue to be announced) (venue to be announced) Phone: John Riggio Columbia Pacific FOA December 9, 2017 December 15, 2017 262-275-3086 Holiday Party (venue to be announced) Phone: 253-261-4455 Phone: 908-232-1336 December 8, 2017 Phone: 503-901-1677 Advertiser’s Index 7-Eleven Inc...... 88-89 Diageo Guinness ...... 21 Mars Ice Cream...... 46 Seneca ...... 22-23 Altria/AGDC ...... 79 Don Miguel...... 14 Maruchan...... 30 Shamrock...... 28 American Licorice...... 86 Dr Pepper Snapple...... 29 McLane...... 54 Simply Orange ...... 12-13 Aon Risk Services ...... 38 Foreign Candy ...... 48 Mondelez...... 17 Swedish Match ...... 10,69 Argo Tea ...... 97 Green Dot...... 92 Nestle Ice Cream...... 32-33 Swisher International ...... 5,6,77 Blue Bunny...... 11 Hormel ...... 40,60 Nestle Professional...... 51 Topps ...... 100 Blue Diamond Growers ...... 99 Johnson&Johnson ...... 59 Nestle Waters...... 34 Unilever Good Humor/ Bug Juice ...... 39 Kellogg's...... 9 P&G Acosta ...... 8,73 Breyers...... 3,4,75 Campbell Soup...... 87 Kraft ...... 85 Pepsi ...... 7,67 Vixxo...... 56 Chobani ...... 42 Kretek International ...... 63, cover 4 Pepsi Quaker ...... 65,82 Whitewave Foods ...... 19 Coca-Cola ...... cover 2 Living Essentials...... 91 Perfetti Van Mele ...... 44 Wrigley ...... cover 3 Dannon ...... 94 Logic Ecig ...... 52-53 Red Bull ...... 83 Windsor ...... 27 Dean Foods...... 37 Majan Acosta ...... 25 Reynolds American ...... 71

MARCH | APRIL 2017 AVANTI 101 Eastern Virginia FOA Utah FOA Golf 7-Eleven FOAC foa events Golf Tournament Tournament Golf Tournament Sleepy Hole Golf Course (venue to be announced) St. Andrews Golf and Country Metro New Jersey FOA Suffolk, Virginia June 8, 2017 Club Trade Show May 25, 2017 Phone: 801-450-4538 West Chicago, IL July 12, 2017 Royal Albert’s Palace Phone: 757-506-5926 Phone: 847-353-9999 Edison, New Jersey Midwest FOA Michigan May 11, 2017 Midwest FOA/Alliance Golf Tournament Phone: 908-232-1336 of 7-Eleven Franchisees (venue to be announced) 7-Eleven FOAC FOA Illinois Trade Show June 14, 2017 Trade Show Southern California FOA Donald E Stephens Convention Phone: 847-971-9457 Odeum Expo Center Trade Show Center Villa Park, IL July 13, 2017 Pasadena Convention Center Rosemont, Illinois FOA Of Greater Los Phone: 847-353-9999 Pasadena, California May 25, 2017 Angeles Golf May 17, 2017 Phone: 847-971-9457 Invitational Phone: 626-255-8555 Black Gold Golf Club Metro New Jersey Midwest FOA/Alliance Yorba Linda, California FOA Picnic Texas FOA Trade Show of 7-Eleven June 21, 2017 (venue to be announced) Four Points by Sheraton Hotel Franchisees FOA Phone: 909-822-4122 August 5, 2017 Irving, Texas Illinois Golf Tournament Phone: 908-232-1336 May 18, 2017 St. Andrews Golf & Country Club Columbia Pacific FOA Phone: 214-208-6116 West Chicago, Illinois Golf Tournament 7-Eleven FOAC June 7, 2017 Langdon Farms Golf Club Family Picnic Texas FOA Phone: 847-971-9457 Aurora, Oregon Forest Preserves of Cook County Golf Tournament June 29, 2017 Ned Brown Meadow Cowboys Golf Club Utah FOA Trade Show Phone: 503-901-1677 Busse Woods Grove 29 Grapevine, Texas (venue to be announced) August 12, 2017 May 19, 2017 June 7, 2017 Chesapeake Division FOA Phone: 847-353-9999 Phone: 214-208-6116 Phone: 801-450-4538 Annual Private Yacht Cruise San Diego FOA Eastern Virginia FOA Nor-Cal United 7-Eleven National Harbor Day At The Races Trade Show FOAs Charity Golf Oxon Hill, Maryland Del Mar Horse Racetrack Hilton Garden Inn Tournament June 30, 2017 Del Mar, California Suffolk, Virginia Hiddenbrooke Golf Club Phone: 571-344-2781 August 25, 2017 May 24, 2017 Vallejo, California Phone: 619-713-2411 June 7, 2017 Phone: 757-506-5926 continued on page 101 Phone: 707-280-1776

Caesars Palace National Coalition 42nd Annual Las Vegas Hotel Convention &Trade Show Las Vegas, Nevada July 17–20,2017 Trade Show: July 19-20, 2017 Register at www.ncasef.com!

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