2 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 3 4 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 5 6 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 7 8 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 9 10 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 11 12 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 13 T H E V O I C E O F 7 -ELEVEN FRANCHISEES May/June 2015 Contents SPECIAL FEATURES THE NATIONAL COALITION 28 Foodservice Is Our Future 40 YEARS OF By Waqar Sheikh, President, Virginia FOA FRANCHISEE UNITY 53 It’s A Good Start, But SEI Needs To Do More To Help Franchisees ATIMELINE By Gary Singh, Vice President, San Diego FOA Page 60 55 SEI Listened & Responded By Ray Dhaliwal, NCASEF Accounting Committee, Chairman; President, Greater Bay FOA 95 Back Injuries—Why It Hurts, NCASEF 40th 33 Easing The Burden And What You Can Do About It Annual Convention Of Rising Labor Costs By John Harp, Risk Engineering Consultant, & Trade Show Mitsui Sumitomo Insurance Group By Joe Galea, Chairman, NCASEF 110 You Take Care Of Business, July 27-31 35 On The Path To We Take Care Of Human Resources! Pages 18 & 25 System Improvements Aon Risk Solutions HR Pilot By Jivtesh Gill, Executive Vice Chairman, NCASEF DEPARTMENTS 39 National Coalition Solicits Member News...... 16 Franchisee Opinions And Views Tedeschi, 7-Eleven Global Ranking, Double-Digit Pizza By Eric H. Karp, Esq., General Counsel, NCASEF Growth, Franchisor Practices, C-Stores Fuel America, SAA Dis- coveries, Fresh Items In C-Stores, Skimmers In Florida, NCASEF 45 Too Many FOAs Is A Chairman Joins SEI, Amazon Private-Label, Court Disqualifies Fran- chisee Firm, Foodservice Threatens QSRs, Reynolds Acquires Lorillard, Serious Problem Wal-Mart’s Hot Foods, Getty Acquires 77 C-Stores, Mexican By Hashim Syed, Expansion In Texas, Franchisee Sentenced, E-Cig Use Surges Vice Chairman, NCASEF Legislative Update...... 24 47 The FIW Process: Swipe Fee Lawsuit, Federal Minimum Wage, Los Angeles Minimum Wage, Mis- The Way We Knew It souri's and St. Louis Minimum Wage, Federal Overtime Rule, Chicago 24-Hour By Serge Haitayan, Vice Chairman, NCASEF C-Stores, Florida Store Security Bill, California Tobacco Tax Hike, California Smok- ing Age, NYC High-Sodium Warning, San Francisco Soda Labels, Connecticut 49 Holistic Review Or Smoke Powdered Alcohol, Road Tax Plan, Can't Ban Plastic Bags, Pump Your Own Gas And Mirrors? ...... 100 By Jas Dhillon, Vice Chairman, NCASEF SEI News Airport Terminal 7-Eleven Opens, Operation: Take Command Contest Winners, Zero-Franchise-Fee Stores, Animal Slurpee, Chill Sweepstakes, Ultra Mobile, AVANTI is published by the National Coalition of Associations of 7-Eleven Franchisees Faygo Rock & Rye Slurpee for all independent franchisees, corporate store managers, area licensees and in- terested parties. National Coalition offices are located at 740 Front Street, Suite 170, Santa Cruz, CA 95060. For membership information, call 831-426-4711, e-mail Bits & Pieces...... 28 [email protected] or fax to 831-426-4713. AVANTI Editorial and Advertising Offices are located at 116 Bellevue Ave., Suite 304, Langhorne, Pennsylvania 19047. Vendor Focus...... 105 For advertising information, call Sheldon Smith at 215 750-0178 or fax to 215 750-0399; on-line, send messages to [email protected]. Franchisee Calendars...... 114

14 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 15 NATIONAL COALITION OF ASSOCIATIONS OF 7-ELEVEN FRANCHISEES Register for the 2015 NCASEF NATIONAL OFFICERS Convention at www.ncasef.com Joseph Galea NATIONAL CHAIRMAN stores in the greater Boston area and New 831-426-4711 • [email protected] SEI Acquires Tedeschi Hampshire. Jivtesh Gill EXECUTIVE VICE CHAIRMAN SEI recently announced it has agreed 209-481-7445 • [email protected] to acquire , Inc.'s ap- 7-Eleven On Global Eric H. Karp, Esq. proximately 182 convenience stores in the GENERAL COUNSEL greater Boston, Massachusetts area and in Ranking 617-423-7250 • [email protected] New Hampshire. The transaction is antic- 7-Eleven is the only Jas Dhillon ipated to close in mid 2015, subject to stan- c-store chain to be VICE CHAIRMAN 818-571-1711 • [email protected] dard closing conditions and regulatory listed on BrandZ’s approvals. Terms of the deal were not dis- Top 100 Most Valu- Serge Haitayan closed. The company said it expects to ex- able Global Brands VICE CHAIRMAN 559-355-4899 • [email protected] tend job offers to most Tedeschi Food 2015, coming in at No. 17. According to the Shops employees who are affected by this report, “The appearance of 7-Eleven in the Hashim Syed acquisition upon successful completion of VICE CHAIRMAN BrandZ Retail Top 20 for the first time con- 847-293-8551 • [email protected] their pre-employment screening process firms the strength of the convenience trend. and continued satisfactory performance. Maninder Walia The chain operates TREASURER Currently, SEI operates and franchises 164 55,000 locations worldwide, including a 253-861-6737 • [email protected]

strong presence in Asia.” CONVENTION CHAIRPERSON 7-Eleven more than doubled its store The BrandZ Top 100 520-577-8711 Most Valuable Global [email protected] count in Boston and New Hampshire with Brands ranking is now John Riggio in its tenth year and is MEETING/TRADE SHOW COORDINATOR the acquisiton of Tedeschi Food Shops. 262-275-3086 • [email protected] continued on page 18 Sheldon Smith AVANTI PUBLISHER ADVERTISING MANAGER Get Avanti 215-750-0178 • [email protected] Online! The National Coalition is proud to announce that vendors and fran- Sheldon Smith PUBLISHER&ADVERTISING SALES chisees can now read AVANTI, the 215 750-0178 digital version, online at Issuu.com [email protected] before you receive the printed copy! John Santiago ASSISTANT EDITOR To join the AVANTI distribution list 215 750-0178 [email protected] and receive a link to the latest issue Tricia Kessler as soon as it is uploaded, send an GRAPHIC DESIGN e-mail to [email protected] KESSLER DIGITAL DESIGN with the subject field “AVANTI ONLINE” The Voice of 7-Eleven Franchisees and you will receive an email alert as soon as the digital magazine is May/June 2015 posted. Feel free to include your U.S. postal address in the e-mail if you ©2015 National Coalition of Associations of 7-Eleven Franchisees would also like to be placed on our AVANTI mailing list. AVANTI is also Avanti Magazine is the registered trademark of The National Coalition available on the NCASEF website in pdf format at www.NCASEF.com. of Associations of 7-Eleven Franchisees.

16 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 17 Register for the 2015 NCASEF www.ncasef.com continued from page 16 Convention at

the only study to combine measures of brand equity based on interviews with over three million consumers globally about thousands of global brands. It also uses a rigorous analysis of the financial and business performance of each com- pany to separate the value that brand plays in driving business and shareholder value. Consumer perception of a brand is a key input in determining brand value because brands are a combination of business per- formance, product delivery, clarity of po- sitioning, and leadership. Apple is No.1 on the list, followed in 40th Annual Convention & Trade Show order by Google, Microsoft, IBM, Visa, AT&T, Verizon, Coca-Cola, McDonald’s Sheraton Chicago Hotel and Towers and Marlboro. July 27-31, 2015 Trade Show: July 30-31 The National Coalition turns the Big 4-0 this year, and here’s what the Convention Committee has C-Stores Have Double- scheduled to celebrate this momentous event! Join us for the seminars, the two-day trade show at Down- town Chicago’s renowned Navy Pier, golf at St. Andrews Golf & Country Club— voted Top 3 “Favorite Golf Digit Pizza Growth Course for an Outing” by Chicagoland Golf readers, and at Wednesday night’s blowout bar party at Untitled Cases of pizza crust and dough shipped Supper Club, a Prohibition Era-themed lounge. Remember to download the schedule to your smartphone so to convenience stores from broadline food- you don’t miss out on anything! Visit WWW.NACSEF.COM for more details. service distributors increased by 27 percent and servings of pizza ordered by convenience Monday, July 27 Thursday, July 30 store customers increased by over 20 percent 12:00 p.m. - 5:00 p.m. Franchisee and Vendor Registration 9:00 a.m. - 1:00 p.m. Franchisee and Vendor Registration in the year ending February 2015 compared 8:00 a.m. - 9:00 a.m. Continental Breakfast 7:00 p.m. - 9:00 p.m. Welcome Reception at Sheraton to year ago, reports The NPD Group. Total Chicago Riverwalk Terrace with Live Music 9:00 a.m. - 11:00 a.m. “Legal Talk” With Eric H. Karp, NCASEF General Counsel (Franchisees Only) dollars of pizza crust and dough cases Tuesday, July 28 11:00 a.m. - 4:00 p.m. Trade Show at Navy Pier Festival Hall A shipped from broadline distributors to c- 9:00 a.m. - 12:00 p.m. Franchisee and Vendor Registration 6:00 p.m. - 8:00 p.m. Charity Auction Night Benefiting Swim stores increased 8:00 a.m. - 9:00 a.m. Continental Breakfast Across America and St. Jude Children’s Research Hospital by over 30 per- 9:00 a.m. - 12:00 p.m. “The State Of The Coalition” with Chair- Hosted By Magician Mike Hammer (Franchisees, Sponsors and cent, according man Joe Galea and The NCASEF Officers (Franchisees Only) Registered Exhibitors) to the com- 12:00 p.m. - 2:00 p.m. Lucky Lotto Luncheon with Magician 8:00 p.m. - 9:00 p.m. International Buffet Dinner Mike Hammer and Prize Giveaways (Franchisees and Major Sponsors) 9:00 p.m. - 12:00 a.m. 40th Anniversary Dance Party pany’s Supply- 2:00 p.m. Explore Chicago at Your Leisure—Self sign-up for with DJ Sohbash Track report. Chicago tours Total dollars of The popularity Friday, July 31 of the pizza cat- Wednesday, July 29 9:00 a.m. - 11:00 a.m. Franchisee and Vendor Registration pizza crust and Joe Saraceno Charity Golf Tournament At St. Andrews egory at c- 8:00 a.m. -9:00 a.m. Continental Breakfast Golf & Country Club Benefiting Swim Across America dough cases stores is further and St. Jude Children’s Research Hospital 9:00 a.m. -11:00 a.m. “Take Control Of Your Finances” Accounting Seminar, Senior VP Alicia Howell, 7-Eleven, Inc. evidence of the 9:00 a.m. - 5:00 p.m. Franchisee and Vendor Registration shipped to c-stores channel’s in- 6:30 a.m. Buses Depart 11:00 a.m. - 4:00 p.m. Trade Show at Navy Pier Festival Hall A has increased by 8:00 a.m. Shotgun Start 6:00 p.m. - 7:00 p.m. Cocktail Reception creasing focus 8:00 a.m. Free Day—Explore Chicago at your leisure 7:00 p.m. - 11:00 p.m. Grand Banquet with Special Guest over 30 percent, on foodservice Self sign-up for Chicago tours Speaker (Franchisees, Sponsors and Registered Exhibitors) according to continued on 8:00 p.m. - 12:00 a.m. 40th Anniversary Bar Party Visit WWW.NACSEF.COM for more details. page 20 At Untitled Supper Club (Adults Only) NPD Group. 18 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 19 continued from page 18 and its competitive threat to traditional quick sion to investigate alleged abusive practices investments when a franchisor wrongly service restaurants, the report states. The by major franchisors, reported Reuters. In terminates their relationship. At that time, double-digit growth in pizza servings at c- its petition, the SEIU outlined six U.S. fran- Brown called on opposing sides in the bat- stores contrasts to flat servings at quick serv- chisor practices it said appeared endemic tle over the legislation to make a concerted ice pizza restaurants and a 1 percent increase and "particularly harmful." The union said effort to find a collaborative solution. at traditional quick service restaurants, finds those practices include incomplete or mis- NPD’s foodservice market research. leading financial performance representa- tions, unreasonable capital expenditure C-Stores Fuel America demands, retaliation against members of From fuel to snacks to coffee, conven- SEIU Wants To Probe independent franchisee organizations, un- ience stores are uniquely equipped to meet fair termination, unfair nonrenewal, and the needs of Americans on-the-go, ac- Franchisor Practices interference with transfers or sales. cording to an infographic released by The Service Employees The SEIU is currently backing a pro- Cenex. Some of the more interesting tid- International Union posed law in California that would make bits revealed by the infographic include: (SEIU), backer of a three- it more difficult for franchisors to termi- • One out of every $25 spent in the U.S. is year campaign to im- nate agreements with franchisees. Last spent at a convenience store. prove the plight of low-wage retail and year, California Governor Jerry Brown ve- • C-stores employ 2.2 million Americans, fast-food workers, recently announced it toed a bill that would have helped fran- and make a huge impact on local would petition the Federal Trade Commis- chisees recoup some of their business continued on page 24 22 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 23 Register for the 2015 NCASEF Convention at www.ncasef.com continued from page 20 economies. Legislative Update • The average c-store pumps more than 4,000 gallons of fuel every day. That’s Retailers File Another enough fuel to drive a car around the world Swipe Fee Class Action four times. Lawsuit • The average c-store offers more than 2,000 items for sale. A group of retailers recently filed a class action lawsuit against Visa • C-stores across the country sell nearly 23 and MasterCard accusing the payment million cups of coffee every day. Laid end- card giants of unlawfully restraining competition and forcing merchants to pay exces- to-end, that’s enough to line the entire sive interchange fees to accept payment from Visa and MasterCard credit and debit length of Route 66. cards, reported Top Class Actions. The swipe fee class action lawsuit alleges Visa and MasterCard have engaged in an illegal conspiracy in violation of federal antitrust laws. Among the plaintiffs are c-store retailers Inc., Allsup's Convenience New Discoveries For SAA Stores Inc., RaceTrac Petroleum Inc., QuickChek Corp., QuikTrip Corp. and Swim Across America (SAA)—which Inc. The group is seeking damages, attorneys’ fees, costs of the lawsuit, and pre- and is dedicated to raising money and aware- post-judgment interest. They have demanded a jury trial. ness for Bill To Raise Federal Minimum Wage cancer re- A bill introdued in A bill was introduced on Capitol Hill in early May that search, pre- May would raise the vention and treatment through would raise the federal minimum wage to $12 an hour over swimming-related events—recently an- five years, and then index it to median wage growth, re- federal minimum ported NACS Online. The measure, co-sponsored by Rep. nounced news of promising discoveries wage to $12 by 2020. Bobby Scott (D-VA) and Sen. Patty Murray (D-WA), would made by two of its Swim Across America raise the federal minimum wage to $8 in 2016 and increase Labs. it by a dollar annually in subsequent years, until it reaches $12 in 2020. The proposal In a clinical trial funded primarily by would also gradually phase out the tipped minimum wage, which has held at $2.13 SAA, scientists at the Sidney Kimmel Com- since 1991, raising it to equal the minimum wage, followed by indexing. The federal prehensive Cancer Center at Johns Hopkins minimum wage has stayed at $7.25 an hour for the past six years, even as cities and have found a promising genetic biomarker states across the nation raised their local wages. Proponents of the bill said the mini- to predict response to certain immunother- mum wage hike is long overdo and has widespread public support. aphy drugs. In the trial of 48 patients with Missouri's Minimum Wage Up For Vote colon and other cancers who have failed standard therapies, researchers found that Three initiative petitions that would ask voters whether to increase Missouri’s min- mistakes in so-called mismatch repair genes, imum wage have been cleared by the Secretary of State’s office for backers to begin gath- first identified by Hopkins and other ering signatures, reported KBIA 91.3. One scientists two decades ago, may ac- Business groups warn minimum wage version of the proposal would gradually raise curately predict who will respond to increases could cause some businesses the state's minimum wage to $15 an hour by the certain immunotherapy drugs year 2023. The second version would gradually to lay off workers or change location. raise the minimum wage to $12 an hour by known as PD-1 inhibitors. 2020, while the third version would raise it to Dr. Jedd Wolchok, Director of $11 by the year 2019. If supporters get enough signatures, the proposal would go before the SAA lab at Memorial Sloan-Kettering Missouri voters next year. Missouri's current minimum wage is $7.65 an hour. It goes Cancer Center, recently presented findings up each year based on rate of inflation. at the American Society of Clinical Oncol- ogy. His work on immunotherapeutics has Los Angeles To Raise Minimum Wage lead to recent developments on identifying The Los Angeles City Council recently backed a plan to raise the city’s minimum which patients are likely to benefit from ex- wage to $15 per hour despite concerns from business groups, reported the Los Angeles pensive treatments such as Opdivo, Yervoy continued on page 26 continued on page 28

24 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 25 Register for the 2015 NCASEF continued from page 24 Convention at www.ncasef.com Legislative Update Times. Lawmakers agreed to draft an ordinance raising the $9-an-hour base wage to $15 by 2020 for as many as 800,000 workers, making L.A. the largest city in the na- tion to adopt a major minimum-wage hike. Chicago, San Fran- cisco and Seattle already have approved similar increases, and raising the federal minimum wage has moved to the forefront of the Democratic Party’s agenda. On a 14 to 1 vote, the council instructed the City Attorney to prepare an ordinance carrying out the wage hikes, setting the stage for a final vote on the measure in June. Mayor Eric Garcetti has already promised to sign the wage increase into law, allowing The National Retail Federation released a study in May that the first wage boost—to $10.50 per hour—to take effect in July said 3.3 million salaried retail and restaurant employees do not 2016. The harshest criticism of the law came from business qualify for overtime. Raising the threshold to $42,000 would make groups, which warned lawmakers that the mandate would force 1.7 million more people eligible for overtime pay and cost busi- employers to lay off workers or leave the city altogether. nesses $5.2 billion a year, the study said. Next year, California and St. Louis Could Raise Minimum Wage New York are set to raise income thresholds for overtime pay under state laws to $800 and $675 per week, respectively. A push to increase St. Louis’ minimum wage to $15 per hour Florida Gov Vetoes Store Security Bill has gained support from city leaders, including Mayor Francis Slay, according to news station Fox2Now. The proposal, which will be Florida Gov. Rick Scott recently vetoed a bill designed to beef reviewed by the Board of Aldermen, would immediately increase up convenience store security, reported the Associated Press. The the minimum wage to $10. Then, every year it would increase by store security bill (HB 755) would have required family-owned $1.25 until it reaches $15 by 2020. Small businesses that employ convenience stores to follow certain security measures that are al- 15 people or less would be exempt. Supporters say this raise would ready in place for stores owned by large vendors. Scott said he ve- be an economic boost for the city and its residents, helping to al- toed the bill because it would a place a "significant new financial leviate poverty. But some worry the minimum wage increase, on burden" on small business owners. top of the city’s 1 percent earnings tax, could incentivize businesses Chicago Lawmakers Target to leave downtown. 24-Hour C-Stores Lawmakers Hold Hearing On Chicago convenience stores would need city approval to stay New Federal Overtime Rule open all night, approval that would be granted only if operators Congressional Republicans have a plan to minimize “noise and disturbances,” under a held a hearing in early June to con- crackdown proposed by a handful of aldermen, reported sider concerns by business owners The Labor Department the Chicago Sun-Times. The ordinance states that, “In order about a Labor Department plan to in May submitted a draft to reduce noise and disturbances in and near residential boost overtime pay for millions of proposal to raise the an- districts, a retail food establishment whose primary busi- Americans, reported Reuters. The nual income cap from the ness activity is the service of prepared food to the public Labor Department in May submit- shall not be open for business … between the hours of 1 ted a draft proposal to raise the an- current $23,660 or $455 a.m. and 5 a.m. without permission from the commissioner nual income cap from the current per week for workers of Business Affairs and Consumer Protection.” $23,660 or $455 per week for eligible for overtime pay. For permission to stay open all night, c-store operators workers eligible for overtime pay. must submit a written application that includes: a list of all However, officials did not release residential units within 660 feet of any portion of the build- details of the proposal. Some experts say the federal minimum ing that includes the c-store; a plan for minimizing noise and dis- exempt salary could be raised to $50,000 or higher. The proposal turbances associated with the operation; and a description of the may also address the current exemption of many white-collar c-store premises, including seating capacity, points of ingress and

workers from overtime protections. continued on page 82

26 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 27 Register for the 2015 NCASEF Convention at www.ncasef.com

continued from page 24

Foodservice Is Our Future Waqar Sheikh | President, Virginia FOA In 2014, convenience stores sold some 391 million doughnuts for sales of about $580 7-Eleven stores in the past have had very little oven because it’s so fresh and good. I believe this million, reported CNBC, citing the latest IRI ready-to-go fresh and hot foods as some of our early would lead to word of mouth—the best form of data. • Japan Tobacco Inc. has agreed to attempts did not work out as well as we wanted. As advertising—which will help bring in more cus- acquire U.S. electronic cigarette com- a result, we went to selling more snacks and pack- tomers and will also create repeat customers. pany Logic Technology Development aged foods. Then Joe DePinto took over the reins at I realize not every store is ready for the next LLC, reported the Wall Street Journal.The SEI and announced we are moving forward with the level of foodservice, but stores in the Washington, deal will give Japan Tobacco the third foodservice business because we could no longer D.C. area and about four or five other markets in largest e-cigarette company in U.S. c-stores rely on declining tobacco and alcohol sales to pull us the Liberty Zone already have huge foodservice with about a 20 percent market share. • through. When he first presented the detailed road sales and are ready for a big change. The margins Following its acquisition of , Inc. map on 7-Eleven’s foodservice goals, he explained are good because the more you sell, the lower on March 16, 2015, Circle-K parent com- that we have to find something new, and that food- your write-offs and your margins go up. pany Alimentation Couche-Tard added service is our future. more than 1,500 stores to its network in I know some of the franchisees who don’t have In order for foodser- the United States, totaling 7,815 conven- “True, in the begin- hot foods in their stores yet are worried about vice to work for us, I be- ience stores in North America. • CVS ning you will have margins. In my stores and in many of the stores in lieve the quality of our Health Corp. is buying Target Corp.'s some write-offs, but our area, we are not doing less than 39 or 40 per- offerings should be very pharmacy and clinic businesses for about cent gross profit with hot foods. True, in the begin- once you fine-tune high. One of the unique $1.9 billion, reported Dow Jones Business ning you will have some write-offs, but once you your foodservice challenges we face right News. The deal includes more than 1,660 fine-tune your foodservice selection to your cus- selection to your now is that we have to pharmacies, which CVS will rebrand as tomers, write-offs become less of a concern. customers, write- display the food we sell CVS/pharmacy and operate through a offs become less rather than cook it or Foodservice may be our future and may be our store-within-a-store format, and nearly 80 of a concern.” prepare it as it’s ordered, destiny. If we don't work hard right now to fine- clinics, which will be rebranded as Min- much like it’s done at tune the program, we'll be left behind as our uteClinic. • A new startup has developed a McDonald’s or Subway. I highly encourage the com- competitors cash in. I'm very excited about the fu- gasoline delivery service that allows pany to start a menu-based program so that a cus- ture of our foodservice program, and I believe drivers to refuel wherever they are by tomer can order a pizza and have it fresh from the that 7-Eleven ultimately simply using a smartphone app, reported WAQAR SHEIKH oven. We have a very good oven, which can make will be known as a CAN BE REACHED AT The Verge. Filld, the service provider, then food in about a minute or a minute and a half. I'm source for great fresh 540.270.7934 or sends a truck to the customer’s location and sure our customers will love food right from the and hot foods. [email protected] fills the tank for a flat fee of $7 plus the per gallon local gas price. • According to a survey by social consultancy group Good Charity Golf Tournament and Live & Silent One in three Americans say Scout, 71 percent of consumers say they they have purchased more Auction events during the NCASEF’s 40th an- have donated to a charity at the regis- nual convention. SAA is also supported by sev- ter, and 66 percent of consumers donate snacks considered "healthy eral FOAs across the country. less than $2 at one time. • Facebook re- choices" over the past year, cently announced it is going to raise its minimum wage to $15 an hour for con- according to NACS. Consumers Turning To tractors and vendors, as well as provide them with 15 vacation days and a $4,000 and Keytruda, which could save money and Fresh Items In C-Stores bonus for having a child. • State lotteries prevent side effects. Over one in three Americans (34 percent) suffering from “jackpot fatigue” need in- SAA is one of two charities that will ben- say that they have purchased more snacks that creasingly bigger jackpots to lure in casual efit from funds raised at the Joe Saraceno are considered "healthy choices" over the past continued on page 40 continued on page 86

28 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 29 $name game winner Pranjal Patel, North Wales, PA$ 30 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 31 BY JOE GALEA, EXECUTIVE CHAIRMAN, NCASEF

One of the bigger issues causing in that time we’ve “Higher volume tremendous concern for 7-Eleven fran- managed to chisees these days is the wave of minimum adjust our stores are perhaps wage increases spreading across the coun- budgets to deal try. As small business owners it’s very trou- with it. But many fran- impacted minimally, but bling to see cities raising their minimum chisees fear the minimum wage the lower volume stores will wagesEasing from $7.25 an hour Theor a little more, Burdenincreases coming just as theOf company to as much as $15 an hour, because it rep- is rolling out the hot foods program will struggle with these added resents a huge spike in our payroll expenses. prove too difficult to adapt to by simply It's a topicRising that's been discussed atLabor the Na- tweaking our Costs budgets. While we hope hot minimum wage costs.” tional Coalition meetings and at FOA meetings nationwide, and during our meet- ings with SEI. lieve SEI should review our store operating Although minimum wage increases costs and make adjustments to our agree- are inevitable, having such large increases ment so it’s more favorable to both parties. imposed on us over a short period of time SEI should sit and discuss with us in good is oppressive financially. Add to this the ris- faith the impact the minimum wage in- ing costs of credit card fees that we share creases, credit card fees and the added labor with SEI and the roll out of the hot foods of hot foods are having on some of our program—which requires more labor—and stores and work with us on a solution. we have a recipe for financial disaster. Higher volume stores are perhaps impacted minimally, but the lower volume stores will struggle with these added costs. Times are changing, and as we continue to talk to SEI management we need to focus on what is good for the store, the franchisee, our guests, and our vendor partners. One of the best things that can happen “We need a balance wherein increasing expenses to a franchise is having a healthy, profitable system. That's what we need to achieve. We aren’t Looking always back to when shifted we first fran-unto foodsfranchisees. will be very successful I believe and we will be need to understand these new expenses and SEIchised shouldour stores, the review agreement wasour pretty storeable operatingto maximize it to costsit’s fullest andto obtain do a total evaluation of all stores by volume simple. The minimum wage was low, credit the highest profitability, we doubt that or location and make it a fair program for makecard fees were adjustments something SEI always to tookour agreementwould be enough to so offset it’s the more increased everyone. Salaries are totally a franchise ex- favorablecare of on our behalf, to both and new parties.” programs payroll costs. pense, as we're defined as independent con- like the roller grill were implemented with We have voiced these concerns to SEI tractors, but with the credit card fees and few interruptions. management, and we told them we under- hot foods program there can be some kind JOE GALEA We have been stand that sometimes expenses can shift to of compromise to help some of these stores. CAN BE REACHED AT sharing the credit card our side of the ledger. But there needs to be Our hope is that SEI can develop a solution 831-426-4711 or fees with SEI for about a balance wherein increasing expenses quickly so our stores can weather the finan- [email protected] the last six years, and aren’t always shifted unto franchisees. I be- cial storm headed our way.

32 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 33 BY JIVTESH GILL, EXECUTIVE VICE CHAIRMAN, NCASEF Running a successful 24/7 conven- “NCASEF issues records to make ience store business is challenging during sure all deliveries the best of times, but it becomes down- presented to SEI and sales are properly ac- right discouraging when your franchisor counted for. There is a report creates more problems before solving the were sent over to the available in 7-Hub to help with ones you already have. That has been the this that provides the details on situation for franchisees over the last sev- NBLC for resolution.” purchases starting with the last eral years, but things as of late have been audit and accounts for all sales infor- Onchanging, andThe SEI has been workingPath with To mation received thru Cash Summaries. the franchise community to make our nancially, an $800 to $1,800 maintenance This report is available after 10 business business strongerSystem and more manageable Improvementscharge could throw them under equity days after the audit. The problem is that for both parties. With this goal in mind, and generate other consequences, such as the report is nearly hidden under the Im- we are now engaged in closer dialogue breaches and LONs. aging menu: 7-Hub→Store Tools→Expand with SEI to resolve the issues creating the In our experience when these non- Imaging→Image Lottery Audits. We asked most problems for franchisees. contract charges are disputed by franchisees SEI why that report is residing under Im- To move matters forward, the Na- the vast majority of them get credited back. aging and recommended it should be tional Coalition spent time during its last moved to Seven Reports like other reports. few Board meetings gathering a list of all SEI will look into standardizing these re- the issues affecting franchisees (the ma- ports so results are displayed much jority are accounting-related) and created quicker, and will also provide training and a committee tasked with presenting these communication so franchisees can utilize issues to SEI. The committee members the Lottery management tools. met with our franchisor on February 3 We’ve been requesting for a long while and presented 32 topics of discussion to to receive a deposit verification notice when the 7-Eleven team, which consisted of ac- our bank deposits are recorded. We in- counting senior staff and some members formed SEI that many times we are not no- of the executive team. Ray Dhaliwal cov- tified until several days after the deposit is ers many of the topics discussed during the meeting in his article on page 55, so I will discuss some of the issues that were “We requested that SEI open a ‘suspense’ account the sent over to the NBLC Accounting Com- mittee for resolution. moment a franchisee disputes a maintenance charge.” The first issue is the creation of a “sus- pense” account for all disputed mainte- We requested that SEI open a “suspense” made, and we would like to see instantly that nance charges. Typically, franchisees get account the moment a maintenance charge the deposit was credited so we can take im- charged on their AP9 (Accounts Payable) is disputed where the franchisee can be mediate action if there are any errors. Now for maintenance and other things, and see credited and the money remains until the the D-RA1 Daily Bank Activity Report is a small explanation of the charge. If they issue is resolved. This request was made available to franchisees, which will be cur- don’t agree with the charge, they have to very clear in the NBLC, and SEI has com- rent up to deposits made the previous day. open a case and dispute it. The problem is mitted to make some system changes. They Another issue given to the NBLC to the dispute can take 60 to 120 days to be have promised to follow up and add re- resolve is common area maintenance resolved and get the sources to resolve this issue. (CAM) charges. With many leased stores Another issue involves lottery recon- JIVTESH GILL money refunded back in strip malls, etc. the leases contain a CAN BE REACHED AT to the franchisee’s ac- ciliation after an audit. Many franchisees CAM charge for which the store is respon- 209-481-7445 or count. In certain situ- have a hard time understanding their lot- sible. Quite often stores have no knowledge [email protected] ations, when a tery audit results, so they would like to of how the charge is calculated or when it’s franchisee is tight fi- look for details to reconcile it with their continued on page 36

34 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 35 continued from page 35 raised, and don’t know who negotiates “We have asked SEI to give franchisee’s bottom line. these terms on their behalf. We see stores Store remodels are starting up again nationally where CAM charges jump sig- franchisees access to lease in November in Southern California, and nificantly from year to year. Just like FM the plan is to update 800 stores by the end Facility Maintenance charges, these CAM agreements that show CAM of 2016, each with one of five different re- charges are paid by franchisees but negoti- model programs. So it’s not a cookie cutter ated by SEI without any input from fran- charge increases.” approach and one remodel program for chisees.On The We have Path asked SEITo to System give Improvements everyone—it will be based on individual franchisees access to lease agreements to stores. We requested more than a few see the CAM charges, as well as informa- of each employee’s accrued sick leave changes of equipment and new counters. tion regarding the increases. SEI has agreed hours. SEI has promised a solution on this When the remodel is finished, we want it to review the details on this, and be very issue very soon so franchisees do not have to be visible from the inside as well as the transparent on details. We will take this to keep track of this themselves. outside, so when customers walk in they issue up again at the next NBLC meeting. Audits continue to be a concern. can actually feel the change. Although the California sick leave When we moved from WIS to RGIS we At the end of the day, for 7-Eleven to re- law affects only California franchisees, hoped some of our concerns would go main competitive all issues preventing fran- similar legislation could spread easily to away, but unfortunately, that is not the chisees from operating successful and other parts of the country. We’ve had a case. Franchisees overall are still frus- profitable stores must be resolved. We’re couple of conference calls with all the Cal- trated with audit results. They have to per- hopeful SEI will allocate the resources to fix ifornia FOA presidents and SEI Account- form cycle counts immediately after the these issues, and will not base their decisions ing on this topic. After quite a bit of audits to keep the “I” accurate. The quality for the appropriate resolutions on just their discussion, SEI agreed to make some en- and training of the auditors is also a huge bottom line, but instead on how these im- hancements within the Store Payroll Sys- concern. We continue to work with SEI on provements will make franchisees more suc- tem so they can calculate and keep track this important issue, which impacts each cessful and our lives a little bit easier.

MAY | JUNE 2015 AVANTI 37 ERIC H. KARP, ESQ., GENERAL COUNSEL TO NCASEF

As your General Counsel, one of my roles is to ensure that the issues we ad- “Great care was taken to make vance on behalf of the National Coalition sure that the survey questions accurately reflect the priorities, concerns and viewpoints of not just the Executive elicited information regarding Officers and the Board, but also of the Nationalconstituent franchisees who are Coalition members Solicits matters of the greatest interest of the FOAs that comprise what is truly a to franchisees.” NationalFranchisee Coalition. Opinions And Views To that end, we recommended that the Board engage a professional research • 44 percent are dissatisfied or very dis-

and polling firm to conduct a scientifi- satisfied with the performance of their

cally valid survey of 7-Eleven franchisees. local CDC The Board readily agreed to retain Fran- us as your General Counsel to our coun- • 74 percent do not believe that their CDC chiseGrade.com to carry out this project. terparts at the franchisor, and by the offers the lowest cost of goods available on Great care was taken to make sure that Board in its dealings with SEI’s manage- most products; here are the details: the survey questions elicited information ment team. regarding matters of the greatest interest Here are some of the results of the The CDC offers the lowest cost of goods to franchisees. We also wanted to make survey: available on most products. sure that the responses would be confi- 5% Strongly Disagree Operational Issues % 1 % Disagree dential in all respects. • 50 percent of franchisees believe that % 74 46% 7 Neither Disagree or Agree % % In the end, 642 surveys were com- the DVR security system has not con- 13 28 Agree pleted, which creates a 95 percent confi- tributed to store safety or reduced theft Strongly Agree N/A (no CDC) dence level in the results with a margin of • 66 percent do not believe that SEI’s error of 3.7 percent. Those who re- audit process is fair and transparent sponded reflected a valid and broad • 47 percent are dissatisfied or very dissat- • 54 percent do not believe it is worth- cross-section of the system in terms of isfied with the performance of McLane; while to own a gas store in light of the age, number of years as a franchisee, level details are shown in the chart below: commission structure of education, prior business experience • 60 percent of the respondents have been How satisfied are you with the and number of stores owned. This meets part of BT performance of McLane in your statistical and academic survey collection area over the last two years? • 32 percent of the BT respondents be- standards. 5% lieve their store has benefited from BT; 54 The results of the survey indicate percent believe that there has been no % % that the relationship between SEI and its 29% 47 22 Very Dissatisfied benefit to the store from BT % Dissatisfied franchisees is on the whole not positive, % 25 19 continued on page 40 and in need of a great deal of substantive change for the better. The results also val-

idate the depth of ERIC H. KARP concern and unhap- CAN BE REACHED AT piness among fran-

617-423-7250 chisees that has been [email protected] described to SEI by

38 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 39 “In the end, 642 surveys were completed, which

creates a 95 percent confidence level in the results

with a margin of error of 3.7 percent.”

continued from page 39

Relationship Issues • 80 percent do not believe that they are continued from page 28 treated as independent contractors by SEI players who buy lottery

National• 61 percent do not Coalition trust SEI Solicits tickets only when a • 75 percent believe that SEI does not prize is huge, reported USA Today. People once

Franchiseetrust them Opinions And Views impressed with a $100 million payout shrug “The results of the survey until it reaches $300 million. • Google recently 7-Eleven, Inc. trusts its franchisees. unveiled Android Pay, which enables Mas-

% terCard credit, debit, prepaid and small busi- 2 Strongly Disagree indicate that the relation- % 9 Disagree ness cardholders to use their Android phones 75% 43% % Neither Disagree or Agree ship between SEI and its for everyday purchases in-store and within An- 13 % 32 Agree droid apps. • A new report from the Federal Re- Strongly Agree franchisees is on the serve reveals that 47 percent of Americans would have to borrow or sell something to

• 45 percent disagree or strongly disagree whole not positive, and in cover an unexpected expense of $400.• C- with the statement “I am proud to be a 7- need We publishof a great these results deal with of a single store chain Casey's General Stores is now offer- Eleven Franchisee” ing online ordering for pizzas, subs and goal in mind. In recent months, your • 58 percent are dissatisfied or very dis- substantive change for more in select Iowa counties, reported KCCI 8 franchisor has pledged in numerous fo- satisfied as a franchisee of 7-Eleven News. Testing of the online foodservice ordering rumsthe better.”to reset the relationship between • 49 percent would not choose to be a 7- started at the end of last year. • Philippine the company and its franchisees. The Na- Seven Corp., the licensor of 7-Eleven stores in Eleven franchisee if they had the decision to make all over again tional Coalition has over and over again the Phillipines, said it is on track to open 500 made the point that communication new outlets this year as a part of its nation- If I could make the decision all alone will not suffice; the reset will be wide expansion, reported Manila Standard over again, I would choose to be a 7-Eleven Franchisee. judged by concrete and measurable Today. • Toys R Us will close its FAO Schwarz

% flagship on Fifth Avenue in Manhattan in 8 changes in the legal and financial rela- Strongly Disagree July, reported Bloomberg.The 153-year-old toy tionship between 7-Eleven and its fran- 18% 49 % 28% Disagree brand will continue to sell online and in Toys R Neither Disagree or Agree chisees on a wide range of issues, % 21% Us stores while the company hunts for a less- 25 Agree including those raised in the survey. Strongly Agree pricey Manhattan store space. • Trader Joe’s is We can only hope that the informa- America’s favorite grocery retailer for the • 67 percent would not recommend a 7- tion in this survey will make clear to SEI third year in a row, according to a study of more that the path to a better relationship, to than 7,200 consumers by Market Force Infor- Eleven franchise as an investment to a fam- increased market share, to higher store mation. Publix ranked a close second and ALDI ily member or friend; here are the details level profitability, to expansion of the was third. • A Taco Bell planned for Wicker I would recommend a 7-Eleven franchise system, and ultimately to better Park in Chicago will be the first in the world franchise as an investment opportunity financial results and equity value of the to serve alcohol, reported the Chicago Tribune. option to my family or friends. The new location will open this summer and franchisor, is a truly collaborative rela- 4% serve beer, wine and boozy "freezes" to eat-in Strongly Disagree 11% tionship marked by a fair balance of the 67% 45% Disagree customers only. • A new study by market re- Neither Disagree or Agree risks and rewards of the franchise rela- 18% 22% search firm Packaged Facts reveals that 87 per- Agree tionship. As my fellow tennis enthusiasts cent of American consumers look at the Strongly Agree would say, the ball is in their court. nutrition facts panel on packaged foods and beverages at least sometimes, while 56 percent “The National Coalition has over and over again made the point that actively seek out nutritional information and communication alone will not suffice. The reset of the relationship guidelines. • Inspired by the Replicator device in “Star Trek”—which synthesizes food and bev- will be judged by concrete and measurable changes in the legal and erages within seconds—two Israeli entrepre- financial relationship between 7-Eleven and its franchisees.” continued on page 56

40 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 41 42 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 43 Vice ’ Chairs TOO MANY FOAs IS Forum A SERIOUS PROBLEM HASHIM SYED NCASEF VICE CHAIRMAN, FOAC VICE PRESIDENT

I’ve been in the 7-Eleven system for a very long time and I’ve seen my share of “The formation of new FOAs is not in the best ups and downs. interest of the franchisees. In most cases they are As the Vice President of the FOAC and Vice Chairman of the National Coali- being started by selfish, self-appointed leaders tion of Associations of 7-Eleven Fran- who simply want to soothe their hurt egos.” chisees (NCASEF), I am very aware of the activities of other 7-Eleven FOAs through- and for their own selfish reasons, they de- seem to be popping up all over, and to be out the country and how they run their as- cide to form an association of their own so honest it’s getting out of hand and ab- sociations. I can honestly say that most of they can have complete control and power. solutely ridiculous, especially due to the them, without a doubt, truly care about Believe me, these individuals don’t self-serving reasons behind them. their franchisees and want to do what’s best care at all about the franchisees or the neg- Now to be fair, not all FOAs are formed to help them succeed. ative impact of their decisions. All they by disgruntled franchisees. In some cases, Unfortunately, this isn’t true for all 7- want to do is satisfy their self-serving mo- franchisees have complained that meetings Eleven FOAs. tives and extremely large egos. It’s a very are too far away and that it’s difficult to par- In recent years, I’ve seen first-hand sad and unfortunate situation. ticipate. But, rather than starting a new what can happen when franchisees decide From my personal experience, things es- FOA to accommodate these individuals, a to break away from their existing FOA to calate quickly and get very ugly when an ex- smarter solution would be for the FOA start their own association. I can tell you isting FOA breaks up and the two groups get leadership to plan meetings in various lo- it’s not good. It’s not good for the original into dirty politics and finger pointing. Not only cations each month, making it easier for all FOA, it’s not good for the newly formed is it upsetting and disruptive to the franchisees, members to attend; exactly like SEI does for FOA, and it’s definitely not good for the but it also effects the vendors. market meetings. Distance alone should franchisees. Not only does it create frag- Our vendor partners not be a reason to form a new FOA! mentation and division on a local level, but want to support all FOAs, but I firmly believe that now the ripple effect is felt nationally, as well. there’s only so much they can is the time for the Then why do they do it? do with their limited NCASEF leaders to take a I’ll tell you why. In most cases, these are funds. The formation stand and do what’s right individuals who, for one reason or another, of new FOAs creates for the sake of our NCASEF believe that they have been wronged or mis- frustration for the ven- and the franchisees it repre- treated by the FOA that they belonged to. dors and unnecessary fi- sents. Typically, their feelings somehow got hurt, nancial challenges. They’re not Our current leadership is happy having to choose one FOA over fully aware of the urgent need to “It’s time for the NCASEF another. It’s simply not fair to put them in this send a powerful and clear message to take a firm position position, but that’s what the leaders of these that unity is a priority! We must put an newly formed FOAs are doing. end to the formation of new breakaway and do what is necessary Having seen this time and time again, FOAs and put stronger policies in place to to stop new breakaway there is growing concern about the re- discourage franchisees from doing so. The quirements necessary to form a new fran- cycle of division and fragmentation needs FOAs from forming. New chise owners association. In my opinion, to end now. The best HASHIM SYED by-laws must be consid- there is an immediate need to revise our interests of the fran- CAN BE REACHED AT by-laws to stop, or at the very least, slow chisee community [email protected] ered and implemented, or 847-293-8551 sooner rather than later.” down the creation of new FOAs. They must come first. 44 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 45 Vice ’ Chairs Forum FIW: THE WAY WE KNEW IT SERGE HAITAYAN NCASEF VICE CHAIRMAN, PRESIDENT, SIERRA FOA

Over the last several years, franchisees When SEI extended an olive branch CEO Joe DePinto, who was present at that have been embroiled in a great number of to the franchise community with inten- meeting, said fixing this issue must be conflicts with SEI over policies, processes tions to fix the relationship last year, fran- made a top priority. A committee consist- and program changes we believe have chisee leaders told corporate upper ing of seven franchisees and senior-level caused more harm than good to storeown- management that the FIW was one of the SEI executives was then created to investi- ers. The Financial Impact Worksheet biggest issues impacting the relationship. gate further. (FIW) was one of those processes that To their credit, SEI suspended the process SEI hired a company called Protiviti caused our relationship with 7-Eleven to once it heard this, and hasn’t issued an Consulting to help reshape and redraft the get contentious and reach a boiling point. FIW since July 2014. FIW process. Protiviti conducted a survey Now that our relationship seems to be on of franchisees, and the results revealed four the mend, we are working side-by-side top complaints about the FIW: 1) the with our franchisor to remedy the FIW co- process was complex and hard to under- nundrum, as well as many other issues. In stand, 2) it wasn’t transparent, 3) it was un- fact, at our late June meeting with SEI in fair, and 4) franchisees did not trust the Dallas, SEI informed us that the FIW results. Based on this feedback, the NBLC process as we knew it is a thing of the past. FIW committee went to work. SEI created the FIW process more Our primary concern is to make sure than 10 years ago (it used to be called the the process is fair so that moving forward HQIA, among other things) to make ad- franchisees who make a mistake or are vic- justments when they believed there was tim to employee theft won’t be treated the something reported incorrectly in the store, same as those franchisees who intend to whether it was an under-reporting of sales, “Now that our relation- defraud the system. We want to make cer- an over-reporting of write-offs, or a mis-re- tain there’s a clear distinction in place. tailed item. The company also used the ship seems to be on the Our job as leaders of the franchise FIW to detect fraud intentionally commit- mend, we are working community is not to worry about or pro- ted by a franchisee or a dishonest em- tect storeowners who are committing in- ployee. This is where SEI strayed off course side-by-side with our tentional fraud with a hidden second because they went hard after every fran- franchisor to remedy register or a cigar box. Our job is to protect chisee with the same zeal, regardless if the the FIW conundrum.” the franchisees who make an honest mis- indiscretion was small or large or the result take that might get compounded with of an honest mistake or oversight. Fran- time. A lot of progress was made with SEI chisees making honest mistakes ended up FIWs continued to come up in Coali- on the FIW front. feeling like criminals, and SEI com- tion officers’ meetings with corporate, and Today we have the POS Report that pounded the problem by forcing fran- at the CEO Roundtable. The National we can look at on a weekly basis to detail chisees to pay back the company’s 50 Coalition asked SEI to include Kathy York cash register activity. One of the things percent of the missing gross profit when (Greater Los Angeles FOA President) and franchisees and the National Coalition employees were to myself as members at large on the would like to see is more preventative SERGE HAITAYAN blame. Franchisees NBLC/FIW committee to work with SEI tools on the other side of the business— CAN BE REACHED AT [email protected] clearly believed this to frame the new FIW process. cash report detail and inventory—to see or 559-355-4899 was unfair, and it dam- During the last NBLC meeting we had problems when they start, instead of wait- aged our relationship. a great deal of discussion about FIWs, and continued on page 49

46 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 47 FIW: THE WAY WE KNEW IT continued from page 47 ing a year and going back to the store after working very hard to put this whole In the past Vice we have’ advised fran- Chairs a huge problem develops. We want to process in place asap. chisees with problemsForum not to reach out to know immediately when there is an issue The ultimate goal of this NBLC com- Asset Protection because someone would with an employee, or a mistake, and we mittee has always been to develop a solu- be coming to visit with an FIW based on want SEI to come and warn the franchisee tion that franchisees believe is fair and what they found in the store. Today Asset that they have an issue and should take equitable, and we think SEI feels the same protection has assured us that franchisees shouldn’t be afraid to call about store is- “Today Asset Protection has assured us that sues. They will help solve our problems without the impunity of the FIW. franchisees shouldn’t be afraid to call about store The overwhelming majority of fran- issues. They will help solve our problems without chisees are honest storeowners trying to do a good job everyday for our families, the impunity of the FIW.” our businesses and our franchisor. We are immediate action. In short, we want fu- way. If we can create and build a preventive encouraged by SEI’s announcement at our ture FIW-process tools to support the process that keeps a franchisee tuned-in to June meeting that FIWs will no longer be franchisee rather than function as a what might be off in their stores, we can used against franchisees, and we hope we “gotcha.” If the franchisee does not take prevent an FIW situation from ever com- are on the road to putting in place a fair action (say a stealing employee is not rep- ing up. We could then use Asset Protection process that helps franchisees manage rimanded), at that point it’s not an em- to be just that—protection of franchisee their stores. I will provide an update after ployee issue, it’s a franchisee issue. SEI is assets—not just 7-Eleven’s. our next meeting. HOLISTIC REVIEW OR SMOKE AND MIRRORS? SURVIVAL OF A FRANCHISEE. BY JAS DHILLON VICE CHAIRMAN, NCASEF

‘Smoke and mirrors’ is a metaphor for By the time you read this article creases that have already passed. We can a deceptive, fraudulent or insubstantial ex- seven months of 2015 will have passed, expect more states to vote on increases planation or description. The source of the and more and more cities are passing throughout the balance of this year and name is based on magicians' illusions, minimum wage laws that will define our next at a quickening pace. where magicians make objects appear or businesses and/or decide our viability. I take no position personally or po- disappear by extending or retracting mir- Fourteen states have minimum wage in- litically on the appropriateness or neces- rors amid a distracting burst of smoke. creases already enacted, waiting to be im- sity of these movements. The issue of “income inequality” or wage stagnation is “In our 7-Eleven system 100 percent of better left to the economists and elected officials. I do know the increase in minimum wage rates is that the 2016 national presiden- borne by the franchisee. Can every store tial elections will have this issue sell its way out of this? Probably not.” front and center. Our very livelihoods, and those of The expression may plemented. Five states will countless other small busi- JAS DHILLON CAN BE REACHED AT have a connotation of implement minimum wage in- nesses will be at stake, and 818-571-1711 or virtuosity or cleverness creases in 2015, 12 states will implement every attempt to raise wage rates will fur- jasdhillon@ in carrying out such a increases in 2016, and 7 states will imple- ther redefine our businesses and decide rocketmail.com deception. (Wikipedia) ment increases in 2017. These are in- continued on page 50 48 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 49 Vice ’ HOLISTICChairs REVIEW OR SMOKE AND MIRRORS? SURVIVAL OF A FRANCHISEE. Forum continued from page 49 our viability as well as that of our fran- program, I can honestly say not much is chisor. Today franchisees from every sys- “Last year was a stellar on the horizon. tem imaginable are being painted as year for SEI. They made My personal opinion is it is business greedy, overzealous employers, and more more money than ever as usual in Dallas. National Coalition of- politicians from cities, towns, counties, ficers have expressed the urgency fran- and states are jumping on board. before, and three times chisees feel, and we are told that every To all this add increases in govern- more than in 2008.” concern is being discussed as part of the mental regulation (ours is a heavily regu- company’s holistic review. lated business), channel blurring, In past articles I have confessed to increasing competition, delivery and op- staff, negatively affecting service, or raise being cautiously optimistic about change. erations complexity, the continued and prices. When we raise prices our cus- Today I am actually concerned. I am not changing effects of social media, and the tomers lose and we risk losing them, but sure these issues will be resolved to fran- fact that many of our stores must compete our franchisor gains, because the price in- chisees’ satisfaction. According to our in spite of having older physical plants. In- crease is all in gross profit dollars, which CEO, last year was a stellar year for SEI. deed, the rollout of the hot foods pro- we share with SEI. It’s a vicious cycle. Oh, They made more money than ever before, gram, currently underway for 1,500 and by the way, an increase from $7.50 to and three times more than in 2008. When stores, will increase our labor. It’s enough $10 is mild compared to many proposals. I look at my bottom line, I am at a loss for for Excedrin headache 7-1-1. Many of us would welcome a minimum words! If we look at the impact of a substan- wage at $10, if it stopped there. As if this Old-timers in the system tell me that tial increase in the minimum wage in our was not enough, sell your way through a back in the early days of franchising at 7- 7-Eleven system, which is based on wage increase or raise prices without Eleven the split was 50-50. In the late 1970s the energy crisis caused SEI to ap- proach franchisees about changing the “National Coalition officers have expressed the split to 52-48 because “the future of the urgency franchisees feel, and we are told that company is at stake,” and franchisees re- luctantly agreed. Today, I propose that the every concern is being discussed as future of franchisees is at stake, part of the company’s holistic review.” and the split needs to be 46-54. After all, did your net income in- shared gross profit and not on royalties on jeopardizing sales and you crease three times over 2008? sales, and where the franchisee bears the may get hit with the wrong I picked the title for this cost of “all labor and labor-related ex- side of the graduated gross profit article because I see it from a penses,” we see that 100 percent of the in- split, otherwise known as 7-Eleven’s different angle than SEI. It is crease in wage rates is borne by the “success tax.” not wrong for a CEO to squeeze as much franchisee. Keep in mind too that other The National Coalition team has he or she can out of a business to increase labor related expenses, like workers comp been in face-to-face meetings with our the corporate bottom line, but at what and the employer portion of social secu- CEO and his top brass since October of cost? I have seen our income magically rity taxes are tied to the wage rate, and a last year. While these meetings have disappear while corporate income has in- 33 percent increase in wages from $7.50 opened up a dialogue, I am not sure if it creased. Last year we were not being to $10 also carries approximately $.25 in has been all that fruitful for franchisees. heard. Today we are being heard and that’s additional tax and insurance costs. This We are talking, but we have no sure sign just about it! adds another 3.3 percent to the increase. of relief from our franchisor. Other than These are my thoughts, and yours Can a store sell its way out of this? a shuffling of top brass, and bringing in a may differ. I would love hear from Probably not. The only recourse is to gut much-needed low volume store relief you.

50 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 51 Franchisee Guest Column

It’s A Good Start, But SEI Needs To Do More To Help Franchisees

By Gary Singh Vice President, San Diego FOA

There is a genuine effort on SEI’s part chisee to help re- to be more willing to listen to us, the solve that account- franchisees. I see it from our zone leader ing issue? to our field consultant—they are making Audits are getting better and I see “Even though we are a serious effort to listen, and I really Asset Protection auditing the auditors, commend SEI for turning the page. Op- but if there’s a huge overage and shortage, working together erations, the Merchandise Department why is the franchisee blamed and ac- and Asset Protection are truly working cused of not preparing the store for the with SEI, we still with us to solve as many of our issues as audit? I don’t want to discount that some have high hurdles they can. stores might not be ready for an audit, However, even though we are work- but who in their right mind wants to lose to overcome. ing together with SEI, we still have hur- money due to some minor housekeep- I need someone to dles so high to overcome that I am afraid ing? It could be that the deliveries got to even mention them. Let me try to ex- crossed since there is no timestamp on listen to my issues.” plain what I mean. the receiving log, or if the auditor scans Let’s say you have an accounting the delivery first and then the store scans ting around and waiting for deliveries problem. You explain the problem to the delivery later, that creates a shortage to arrive? your field consultant and create a case right there. While I’m the subject of minimum online. It’s more than likely your case When you talk to the Logistics peo- wages, how does SEI expect us to offset will be closed without a satisfactory res- ple about McLane and CDC delivery the increased labor cost? Do they sin- olution, so you reopen the case and the discrepancies, the first thing they will cerely think we can increase sales by $300 dollars per store day? I have tried “I have tried my best to increase costs to cover my best to get there and I welcome any- minimum wage increases, and I welcome one who can teach me how to do it. Another hurdle is promos—we have anyone who can teach me how to do it.” too many of them and it is hard for our sales associates to keep track of each and cycle goes on. Now my question is, the say is the store was not prepared for the every one. The other effect of promo- field consultants are told to handle these deliveries—i.e. the store did not sched- tions is that our GP is going down. Do problems by corporate, but do they have ule labor to handle the delivery. What you have any control on your GP? any better recourses than we do? All about when the McLane truck leaves I want someone to listen to my issues, they can do is write a note and update the warehouse three hours late? Under which is my GP is going down, my op- the case, but in reality that will not re- the current environment with mini- erating costs going up, and how I can solve the problem and instead create mum wages being increased nation- survive all of this on my own. Yes, Mr. friction between you and the field con- wide, how can a franchisee properly DePinto promised to take a holistic re- sultant, which is only natural. Now, why schedule labor to receive the deliveries view of the system, but I hope I do not is there not even one dedicated person when we have no control over the de- run out of courage and resources in the to listen to the field consultant or fran- livery times? Can you have people sit- meantime.

52 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 53 Franchisee Guest Column

“NCASEF SEI Listened committee members And Responded received a response on all 28 issues the week Ray Dhaliwal, NCASEF Accounting Committee Chairman prior to the President, Greater Bay FOA National Earlier this year, the accounting com- credit explanation. Lottery/Lotto recon- Coalition’s mittee for NCASEF met with SEI’s exec- ciliation is not available to franchisees on May 7-8 board utive team and department directors to a timely basis. Payroll does not notify present a list of 28 accounting-related is- franchisees of garnishments. The Money meeting.” sues compiled by NCASEF Board mem- Network card takes too long to set up. bers and their member franchisees. Deposit verification is not available to to a “live person” during business hours. NCASEF committee members received a franchisees. Expense detail and invoice This pilot will assign an accounting field response on all 28 issues the week prior for CAM charges should be available to trainee to all FCs in the Zone. Accounting to the National Coalition’s May 7-8 board System Improvement II is scheduled to be meeting and reported to the Board. implemented in 2017. SEI is currently The following highlights the issues working to standardize reports, which presented and summarizes the 11 pages should facilitate faster reconciliation, and of responses from the SEI team. Due to will look into having garnishment notifi- the space constraints we cannot list all of cations sent to the store (need to review the issues in detail with the responses. If legal implications before changing). you are interested in the complete com- Accounting will work with IT to rein- mittee report, please contact me or your stitute the bank deposit verification re- port and review our process to see if we “NCASEF’s accounting committee met with SEI’s can achieve better transparency into CAM charges. An NBLC subcommittee executive team and department directors to present is devoted to the issue of billbacks/scan- a list of 28 accounting-related issues compiled by backs, and SEI is looking at this reporting NCASEF Board members and member franchisees.” option in our new system in 2017. For S18s Merch Support will debrief on addi- FOA President, as all presidents have tional improvement opportunities. All been sent an electronic copy. We will be the franchisee monthly. Total earned bill- forms of retail inventory adjustment (S18, tracking these issues through the NBLC, back dollar amount received from ven- RIA, etc.) are processed within 48 hours the CEO Leadership Roundtable and Na- dors must be verified and booked of receipt by the accounting center. One tional Coalition Board meetings. promptly and provided to franchisees and exception to this rule is for retail inven- be on M01. Scanback needs to be incor- I have divided the issues and SEI’s re- tory adjustments aged 90 days when the porated with the Daily Mark Up/Down audit is completed. sponses into four categories, and would report. Franchisee has to keep resubmit- appreciate any feedback you may have. ting S18s for same item. Some recom- 2. ASSET PROTECTION: 1. ACCOUNTING: mended items are factored. ISSUES: A concern has been identified ISSUES: An open CHD case should RESPONSES: SEI is setting up a new regarding “mis-keys by RGIS.” The audit not be forced closed. Franchisees have to pilot “Escalation Desk” in Greater LA. exception report downloads in ISP 24 create a case to determine the charge or Franchisees in that area will be able to talk continued on page 56

MAY | JUNE 2015 AVANTI 55 Franchisee Guest Column SEI Listened And Responded continued from page 55

hours after day of audit. Current store sion to self-billing. We are currently work- price list must be available to audit team ing on a system enhancement that will continued from page 40 leader for franchisee verification. Appeal allow wholesale vendors to function like neurs have created The process for FIWs or Overages does not DSD vendors in terms of a 48 to 72 hour Genie, a machine that can produce an unlimited variety of meals work. FIW process is not clear and check-in/invoice window. The only in- within 30 seconds using pods that contain should be evaluated for improvement. stances where a store would need to create natural dehydrated ingredients, reported Overage policy needs to be repealed. a CHD case to receive credit would be in Reuters. • Monthly sales at restaurants ex- RESPONSES: Asset Protection will the rare circumstance when a McLane de- ceeded grocery store sales for the first time work with RGIS to develop a report. The livery is more than 24 hours late to a store. on record, the National Restaurant Association AP team is conducting monthly verifica- Shippers should not be delivered unless reported. In June 2014, grocery store sales ex- tions on over 400 audits including error they are ordered. The current McLane con- ceeded restaurant sales by $1.6 billion. By April 2015, the gap had essentially reversed, with rate on facing, dollars, piece count, print- tract ends in July of 2016 and our intent is to move away from the CPM model. As we restaurant sales moving out in front by $1.5 bil- ing section, and pre-walk with franchisee. lion. • Brand agency CBX said chain drug negotiate the new contract, franchisees will AP will explore solutions into how we can stores should position themselves for the verify the price file in a way that the fran- be involved in the process and have a voice future by experimenting with paradigm- chisees will accept in the final agreement. busting store prototypes like replacing candy, without printing the (Glory Halleluiah!) high-sugar drinks, and low-end electronics entire list. An estab- 4. GENERAL: with a preventive medicine clinic, an organic lished team includ- juice bar, and FitBit-style gizmos. • An over- ing SEI VP Mark ISSUES: Impact of whelming majority of millennials polled (85 percent) have used a self-service checkout Stinde, franchisees Project-E on fran- chisees. Need for more kiosk and 20 percent say they don’t like in- Bill Huffman, Kirin teracting with cashiers during checkout, ac- changeover support. Husain, Wayne John- cording to a survey by Retale. • Sandwich chain son, and a consulting RESPONSES: We Subway recently celebrated the opening of its company will review the overage policy. need to understand and address any po- 5,000th convenience store and truck stop loca- The FIW process is being overhauled. tential disconnect with franchisees as well tion in Lima, . Subway now has 10,498 restaurants in non-traditional locations— 3. MERCHANDISE: as the available training for accounting practices and processes. Change over sup- nearly a quarter of the brand's global portfolio ISSUES: Auto ship should not happen. falling under the category. • While employers port is under review. Holiday orders cannot be transmitted. BT added a net 85,000 jobs in March, about 2.8 vendor cost does not match vendor hard I want to thank Kathy York, President, million Americans quit their jobs—the copy invoice cost as booked on M01. Greater Los Angeles FOA, Serge most since April 2008—up from 2.7 million in February, reported USA Today. This is a sign of a McLane and CDC approval should be in- Haitayan, Vice Chairman, NCASEF and Teeto Shirajee, Vice President, Central dynamic labor market in which workers feel creased from 24 hours to same as other ven- confident enough to leave one job for another. • Florida FOA, for diligently working with dors. McLane not issuing any credits unless As its population grays and people live longer, a CHD is created. CPM charges without me to put together this exhaustive pres- Japan’s c-stores are increasingly catering to franchisee input. Too many shippers should entation, and also the SEI team for older clientele by introducing home delivery, not come into low volume stores. spending an entire day with us and re- healthy bento boxed meals and being a one- RESPONSES: The Free Fill program has sponding to our requests so efficiently. stop shop where pharmacies share floor space, reported the Japan Times. • Dairy alternative been discontinued based in part on feed- As directed by the NCASEF Board of beverages like almond milk are increasing Directors, this committee will continue back from franchisees. We will strive to their share of the overall dairy beverage mar- have 365 day-a-year delivery. There is a to identify franchisee accounting issues ket and now account for 20 percent of the in- manual solution to periodically align SEI and present them to SEI for distribution dustry, up from barely 14 percent in 2010, and vendor costs to NBLC committees. I encourage every according to a report by Packaged Facts. • A RAY DHALIWAL to remind ven- franchisee who has taken the time to new AARP study debunks myths about age CAN BE REACHED AT dors of need to read this article to send me any issues 50+ workers, showing that they are highly 707.328.3960 or apprise of changes you might have that apply to many fran- motivated, productive and cost effective— [email protected] following conver- chisees nationally. continued on page 82

56 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 57

In 1975 sixty franchisees incorporated as the Convenience Store Franchise Association, and the National Coalition of Associations of 7-Eleven Franchisees (NCASEF) was born. After several early THE NATIONAL COALITION name changes and over 40 years of representing franchisee inter- ests, the National Coalition still provides the only national forum 40 YEARS OF where franchisees can gather, trade experiences, and optimize their interests in working with vendors and 7-Eleven. Today, NCASEF has Franchise Owners Associations in all 31 FRANCHISEE UNITY states in which 7-Eleven operates stores. Avanti Spring 1982 Four officers from Southland Franchise attorney Southland VP Corporation meet with Tim Fine retained Dick Dole met with franchisees of the Detroit as counsel. Coalition Chairman San Fran- and San Francisco FOAs. Bennie Thayer (left) Six Seattle store cisco owners Thirteen franchisee Seattle and San for the first time in owners hold a meet with The national 7-11 Franchise organizations join the ranks of First national convention Francisco FOAs hold 1982, signaling basement Southland Southland Owners Association formed. the national organization. held at the Hacienda Hotel cooperation planning meetings. meeting to dis- Corporation manage- First national convention and Casino, Las Vegas Franchise owner’s Huntington Beach franchisee cuss ways to in August ment. held in Hawaii. groups around the Franchisee Bennie improve profits. opens its Joe Saraceno publishes first 5,000th country find out The “National Newsletter” quarterly issue of “Avanti,” Thayer Elected Coalition officers travel to Dallas for store. about each other’s becomes the Coalition’s which in Italian means “on- chairman of the workshop with management. Renewal existence. first publication. ward” or “forward.” “national.” and open communication are goals.

1973 1974 1975 1976 1977 1978 1980 1981 1982

Sixty fran- Meeting marking the for- Southland Senior VP Dick Dole addresses chisees in- Elected Chairman “Renewal” voted mation of the National National Coalition board for the first time. corporate as Bill Schuessler frames the most important goal The National Coalition Coalition, originally called the Conven- infamous Coalition motto, of the national the 7-11 Franchise Owners 200 vendors exhibit at the Southland ience Stores organization. narrative starts in “None of us is Association. Convention in Las Vegas. The National Franchisee Chairman Bill Coalition has a booth. Association. as great as all of Schuessler seated Franchisee Rosalie Robin- 1973, a time when Franchisee/Corpo- us together.” on National Advisory son of Santa Barbara works rate cooperation 7-Eleven was in a Committee (NAC) on home-grown software to produce her cash report. increases as the First franchisee Avanti National becomes growth phase, building convention held Winter a business entity. around 300 stores a in Las Vegas. 1981 Second Convention The hiring of the held at Riviera Hotel and Casino in Las Vegas. Coalition’s first Renewal for a 10-year period becomes reality. year. Most of the images here are taken from the pages General Counsel, Tim Fine, landed on of AVANTI, which was started by Joe Saraceno in Fall 1980. one of the earliest AVANTI covers.

60 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 61 THE NATIONAL COALITION Avanti 40 YEARS OF May/June 1984 7-Eleven and franchisees FRANCHISEE UNITY saluted the Olympics with Sam, the Olympic eagle mascot, Eric Heiden, the five-time The National is the largest skating gold medal independent franchisee trade winner turned cyclist, association in the country. and Sheila Young National Coalition Ochowicz, U.S. world San Diego FOA holds Chairman Jack cycling champion at Christmas party for Wixon and South- the veledrome. underprivileged children. land commit to First Avanti working to sponsor the Olympic Games. Invitational National Coalition Convention held in 500 California Golf conjunction with 1984 World’s Fair in stores get ATMs. Tournament. New Orleans. Senator Alan Cranston is keynote. Coalition Board approves Southland Affiliate Members, chari- stock splits Chicago stores get ATMs. ties, and booth displays three for two. McLane’s Second Annual The company has 7,140 stores Spring Forward Convenience UFOLI supports Fair in the U.S. and Canada. Store Trade Show held. Franchise Act in NY State. 1983 1984 1985

Bennie Thayer Coalition Counsel Tim Fine writes about Coalition welcomes first retires. Jack Wixon Supreme Court ruling allowing franchisees Affiliate Members: elected National to purchase independently from any vendor. Chairman. Coca-Cola Company Core Mark Joe Saraceno is Ser-Vis, Etc. American Bakeries Veryfine Coalition Board donates Stroh Brewery GYYR John Morrell elected Chairman & Company $2,000 to MDA. M & M Mars Miller Brewing with “good Keebler McLane Southland Dairies relationships” Southland Superior Coffee Avanti Keith Ferguson as a primary Distribution Transaction Jan/Feb 1983 Verification Curtis Langendorf Circulation Spaceship Earth, Epcot goal. Marty’s Foods Bakeries Oscar Mayer Center and the Future Carl Buddig & Pepsi Cola World Pavilion were highlighted for the Southland Chairman Coalition’s 1983 conven- John Thompson speaks tion in Disneyworld. at National Coalition Grand Banquet.

Avanti Mar/Apr 1985 Avanti salutes the snack and bever- Avanti Nov/Dec 1984 age industry as relationships with New national officers: Shirley Borden, vendors grow. Treasurer; Joe Saraceno, National Chairman; and Al Obar, Vice Chairman.

62 AVANTI MAY | JUNE 2015 THE NATIONAL COALITION 40 YEARS OF FRANCHISEE UNITY

Chairman Joe Saraceno writes about the importance of franchisee reactions to a changing business environment. Affiliate Members grow to 52 companies. Annual Convention held in Hawaii for first time, with over Avanti Jan/Feb 1988 Tim Fine writes about the impor- 100 exhibitors. Spotlight on the 1988 officers tance of protection laws regard- Avanti (from top): Joe Saraceno, ing franchisee termination. National Chairman; Al Obar, Sept/Oct National Vice Chairman; Phyllis Chairman 1987 Shideler, Treasurer; Gene Saraceno AVANTI salutes Brown, NW Regional Chair- talks with the 58 Affiliate person; Bob Strauss, Midwest management Members of the Regional Chairperson; Walt about “imbalance in franchisor/ National Coalition Reinbott, Eastern Regional franchisee relationship.” with its first Chairperson; and Frank Affiliate Member Corigliano, Northeastern NAC committees restructured. Special Issue. Regional Chairperson.

1986 1987 1988

Insurance and Franchise JT Acquisition, organized by the Southland and JT Acquisition Cor- renewal, transfer and succession Thompson Corporation, makes ten- poration merge. Losses predicted raised as most important topics. der offer to acquire all outstanding until 1992. Equipment, advertis- shares of Southland Corporation. ing, remodels stop. Franchisees National still support the company. Coalition Black Monday. Southland stock Convention in falls and JT Acquisition loses $500 Franchisees Disneyworld, million. Southland now predicts meet in Las Florida. South- four straight years of losses. Vegas to share land Distribu- questions tion Centers is and concerns. major sponsor. Jerry Lewis represents MDA at the National Coalition Convention and is guest speaker at Grand Ban- quet. Dr. Joyce Brothers 1987 Elected Officers: (seated) speaks at Treasurer Maxine Smith, Chairman luncheon. Joseph Saraceno, Vice Chair Al Obar, Back row: Regional Chairs Larry Zink, Bob Strauss, Don Avanti Mar/Apr 1986 Hefner, Domenick Manzo, Bill Alber. Illustrated cover by Robert J. Moore, II toasts all the 7-Eleven beverage suppliers.

64 AVANTI MAY | JUNE 2015 THE NATIONAL COALITION 40 YEARS OF Avanti FRANCHISEE UNITY Jan/Feb 1991 Chief Financial Officer Affiliate Member Di- Clark Matthews ex- rectory included 80 member companies plains $400 million as vendors sought Ito-Yokado/Seven- even more inde- Eleven Japan restructuring deal. pendent contact with franchisees. The Thompsons write open letter to franchisees urging support for strategic partnership with Seven- Eleven Japan.

Avanti Jan/Feb 1989 National officers (left to right): Ted Poggi, Vice Chairman, Joe Saraceno, Chairman, and Phyllis Shideler, Treasurer, at board meeting in Scottsdale, Arizona.

McLane and CoreMark both hold trade shows for franchisees. Avanti May/Jun 1990 The company restructures $1.8 billion debt and receives $400 million in Avanti Mar/Apr 1991 exchange for 75 percent of stock. AVANTI goes bi-monthly on the Franchisees ask questions, but magazine’s 10th birthday. Cover col- support the company. lage by franchisee Dick Rainforth.

1989 1990 1991 1992 1993

Southland reports 1988 loss of First joint Coalition Board of Court confirms Southland’s $216.2 million on revenues of Directors/Affiliate Member meeting. reorganization. Southland VP $7.99 billion. Steve Krumholtz and other Coalition Convention managers outline goals at Southland sells stores in is held in Hawaii board meeting. Southland and Ted Poggi takes over as Chair- Memphis, Kansas and Minnesota with great success. McLane sign man with platform of “indepen- but not in franchise markets. 200 franchisees Chairman Saraceno provides affidavit definitive agreement. attend board before bankruptcy court. dent decisions.” meeting. Jere Coalition online INFONET service established. Convention held in Reno is huge Thompson speaks. Avanti Jul/Aug 1991 success. Japan’s Toshifumi Tariq Kahn and Teresa Maloney elected Suzuki addresses franchisees. Affiliate Member program AVANTI celebrates Regional Chairpersons. continues to grow. July 4th and grow- New agreement a concern to Avanti Mar/Apr 1993 National Coalition supports AFA efforts to ing franchisee in- franchisees. More militant Chairman Ted pass fair franchising legislation. Exec VP Dick Dole speaks to dependence as the Poggi takes over reigns of the vendors at Affiliate Meeting. Coalition moves to Board meets in Sarasota, Coalition. National Officers meet Fair Franchising sample agreements presented to protect the rights Florida to discuss profitability in San Jose to plot a course for corporate. of franchisees. and equity with management. the new administration. The courts uphold store agreements.

66 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 67 THE NATIONAL COALITION 40 YEARS OF FRANCHISEE UNITY Chairman Poggi meets with Jere Glover, Chief Counsel at the Small Business Administration. Second annual survey shows the majority of franchisees support Management speaks at Reno Board strong tactics in dealing with meeting on the topic of CDCs. corporate. Proposed operations manual Southland VP of Finance Jim Keyes perceived as defacto contract. visits Coalition Board meeting for the first time. Steve Krumholtz writes for AVANTI on CDC “vision.” Slurpee is 30-years-old. Avanti Mar/Apr 1994 Communications with corporate Southland, Coalition are strained as a result of threat- settle Mutual ening legal action. Ted Poggi Termination and begins “State of the Coalition” Retail Automation is the Coalition Release lawsuit. addresses. buzzword. 1994 1995 1996

First National Coalition poll Franchisees visit National Coalition of franchisees on CDC. Washington, D.C. as presents $1 million check to MDA. part of White House Many FOAs look to the Council on Small Coalition for leadership. Business. Coalition continues to support MDA. Avanti May/Jun 1995 The National Avanti May/Jun 1996 Coalition cele- The road to Reno in 1996 was brates 7-Eleven long and winding as lawsuits Days for the first continue and Ted Poggi asks time since the for a business approach from LBO. corporate. Avanti Jul/Aug 1995 Avanti Sept/Oct 1994 The 20th Anniver- sary Convention The 1994 convention in Las and Trade Show Vegas highlights unity and fran- was bigger than chisee rights at the spectacular ever and featured MGM Grand and the magical an array of talented performers. city of OZ. Southland senior management be- gins to actually attend Coalition Board Meetings. 68 AVANTI MAY | JUNE 2015 THE NATIONAL COALITION 40 YEARS OF FRANCHISEE UNITY Franchisee liai- son program Vegas convention is established. largest in Coalition history. CFO Jim Southland high- Keyes and COO lighted on cover Steve Krumholtz address franchisees. of CS News for “exciting Southland gets improved Moody’s rating times.” on stock. Southland management now regular Avanti fixtures at board meetings. Commu- May/June 1997 nication improves. The Coalition cele- brates Las Vegas Avanti Jan/Feb 1998 Keyes, Khan write joint open letter to with its first National Tariq Khan takes over as chairman franchisees on the “new relationship.” C-Store Buying with “business” approach in com- Expo, the largest municating with corporate. Other Coalition included in 7-Eleven trade show in national officers include Executive annual report for the first time. franchisee history. Vice Chair Paula Yocum, Bob Strauss, Gene Villagrana, Tom Winn Coalition representatives invited to Renewal becomes Coalition objective. and Leonard Goltz. visit Japan. 1997 1998 1999

Jim Keyes writes first article for AVANTI. Southland, Coalition Coalition Retailers Against Minors Pur- pledge to establish chasing (RAMP) program established. business relationship. FOA presidents Avanti report to Coali- Nov/Dec tion board from 1997 all franchisee areas for first time. It’s the changing of Southland president Clark the guard as Matthews is invited to lawsuits Coalition board meeting. begin to Avanti JulyAug 1999 wind down Washington The Coalition has its most success- and Tariq State FOA ful convention ever, setting records Khan is leaders pass in both attendance and booth par- elected chairman. At corporate, Jim “illegal under ticipation at the trade show. Same- Keyes takes over as president and CEO. 18 legislation.” store sales are rising and ranchisees are encouraged by the growth. Avanti Coalition Counsel Avanti Sep/Oct 1997 Pat Carter and Sept/Oct 1998 The CDC is a major Southland lawyers Coalition Officers issue with fran- Mike Davis and and Southland sen- chisees, who want Buck Smith appear together on Legal ior management answers from man- Forum at convention. agree that the sys- agement about why tem needs cooper- ation at all levels. goods cost more.

70 AVANTI MAY | JUNE 2015 THE NATIONAL COALITION 40 YEARS OF FRANCHISEE UNITY 7-Eleven Franchisees Against Youth Smoking program, an expansion of Inventory variation is a the RAMP program, formed. major concern to many franchisees. Joint National Avanti Coalition/7-Eleven, Inc. Jul/Aug Case Study Project conducted by Vice 2001 Chairman John Irvine. The Coalition and SEI celebrate to- Jim Keyes succeeds Clark Matthews as gether at the 2001 Mar/Apr 2002 convention. More President and CEO of 7-Eleven, Inc. New Officers elected. John Irvine, franchisees and Bob Rose, Joe Kropkowski, Vice corporate employ- Chairs, Leonard Goltz, Treasurer, Franchisee ees participate Gene Villagrana, Executive Vice Chair leadership works than ever before. and Tariq Khan, Chairman. The board positively with SEI is focused on RIS, sales and merchan- management to introduce positive dising. The National Coalition is SEI establishes Wall of Honor to honor changes into the system as SS sales stronger than ever. The Board meets franchisees. continues to grow. in Napa with 7-Eleven management. SEI introduces Vcom National Coalition cele- SEI loses trademark licensing fees from to franchisees. brates Silver Anniversary abroad, but sales continue to grow. with convention in Dallas. SEI hosts tours of City- VP Franchising Jack Wilke addresses the place headquarters. Franchisees and Coalition Chairman Tariq Khan focuses board, which agrees wholeheartedly to a SEI employees connect. on the impending new agreement. joint 7-Eleven convention for 2002. 2000 2001 2002

Affiliate Member pro- Delaware FOA gram reaches new high, formed. with over 100 members.

Avanti Jul/Aug 2000 The Coalition celebrates its 25th Anniversary in style, with Frankie Avalon. Inventory Variation is franchisees’ biggest concern.

Coalition strengthens financially and politically under Tariq Khan’s “business Avanti Jul/Aug 2002 entity” approach. Avanti Sept/Oct 2001 An unprecedented joint convention with franchisees and corporate man- Bob Strauss and John Wilkerson receive Disaster strikes on September 11. agement is held in New York City to Distinguished Service Awards from The entire system feels the impact. National Coalition. celebrate 7-Eleven’s 75th Birthday. 72 AVANTI MAY | JUNE 2015 THE NATIONAL COALITION 40 YEARS OF FRANCHISEE UNITY

Avanti Courts grant the National Coalition Franchisees continue a Jan/Feb “standing” to represent franchisees in long tradition of sup- 2004 the lawsuit against 7-Eleven. NCASEF porting the Muscular Dystrophy association, Board eventually elects to withdraw raising $80 million over 28 years. ARC completes their review pro- the lawsuit. cess. SEI begins As SEI works on the 2004 new agreement, it SEI issues new “food is passed to the ARC committee co-chaired distribution of the contract service clean” cleanli- by San Diego FOA Presi- ness standards for dent Gene Villagrana and franchisees begin to sign or face operational the introduction of as required by fresh and hot foods. the OFFF/Valente review. Lawsuit Settlement. Greater Bay FOA franchisees rejoin the Avanti Sept/Oct 2005 SEI involves the Coalition in the new agree- National Coalition after a 9-year hiatus. Seven-Eleven Japan ment, but discussions stall when franchisees completes tender learn of the 85 percent buying requirement. McLane Introduces offer for 7-Eleven their Virtual Trade USA at $37.50 per Franchisee Superstars convention held Show, which allows share. The company in Las Vegas and over 200 vendors ex- any customer to eventually goes private under the hibit. Neil Sedaka stars at the banquet. order online. S&i Holdings umbrella.

2003 2004 2005

Franchisees express General Counsel Pat Carter disappointment with the files “No Net Adverse Ef- terms of new agreement. fects” Lawsuit on behalf of Tariq Khan re-elected the National Coalition. SEI Chairman. Jim Keyes stops talking to the National works to raise the stock price. Coalition. SEI distributes first drafts of the 2004 Agreement and franchisees soon begin to sign.

More than 1600 franchisees sign the CEO Jim Keyes new agreement within the allotted time “retires” with $64 with very few holdouts nationwide. million and CFO Moneypenny is not SEI forms the President’s Leadership far behind. Tariq Council (PLC), comprised of Presidents Khan is re-elected Chairman of the of all Franchise Owners Associations in National Coalition. Avanti Jul/Aug 2003 the county. Joe DePinto joins 7-Eleven, The new agreement work group Inc. as new President and reached an impasse as franchisees tried CEO. to compromise at a 75 percent recom- mended vendor buying requirement.

74 AVANTI MAY | JUNE 2015 THE NATIONAL COALITION Goodwill becomes an issue as store growth 40 YEARS OF eats into pricing for franchised stores. FRANCHISEE UNITY Revered former National Coalition chairman and The Coalition forms Vendor Advisory statesman Joe Saraceno Board to help define distribution issues. passes away. NACS begins testimony before congress Dennis Lane elected regarding Interchange fees. Franchisees chairman, defeating get involved. Tariq Khan, chairman for 10 years. St. Louis and San Francisco/ 7-Eleven begins franchising 538 company Monterey Bay stores in Maryland and Virginia. FOAs join the National Coali- Simpsons promo is a huge tion as numbers of franchisees grow. success as 7-Eleven sells over Avanti Jan/Feb 2008 1 million Sprinklicious donuts. As the number of franchisees grows CEO DePinto introduces Retailer new FOAs spring up in areas like Initiative and Servant Leadership and NCASEF Utah, Texas and Washington, DC. franchisees respond positively. holds a suc- Remodeling through AQIP and cessful conven- CMR is in full swing. 7-Eleven begins a 5-year period tion in Hawaii with over of acquisition with the purchase 250 vendors exhibiting and 62 spon- 7-Eleven grows by 800 stores of 206 White Hen stores in the sors. Arnie Hauptmann retained as in one year as Starbucks Chicago area Coalition counsel. suffers, closing 600. 2006 2007 2008

Eight California FOAs send SEI a letter claiming the company is encroaching on fran- chisees’ independent contractor status. SEI introduces the MOT and launches AQIP store remodel program. Chairman Dennis Lane and Vice Chair Joe Galea build the Coalition, forming 20 new FOAs over a two-year period. California bans trans-fat and InBev and Anheuser Busch combine companies. Serge Haitayan writes about the LA test of Avanti July/August 2007 “consolidated With current franchisees purchas- distribution,” which ing more than 50 percent of avail- eventually becomes BT. able stores, more multiples are created, and franchisees who want Franchisees are warned about rampant additional stores enjoy prosperity. credit card fraud in lieu of Avanti Sept/Oct 2006 chargebacks, and 7-Eleven Deadlines and ordering controls private label offerings begin herald the decline of store customiza- to ramp up. tion as the 85 percent requirement trumps franchisee instincts.

76 AVANTI MAY | JUNE 2015 THE NATIONAL COALITION Tucson Franchisee Bruce 40 YEARS OF Maples begins first of two FRANCHISEE UNITY terms as NCASEF Chairman. Avanti New FOAs continue to form as Jan/Feb Two dissenting Chicago the number of franchised stores surges 2011 FOAs reunite into one and past 5000. CDC comes CEO Joe DePinto attends under their trade show. The new coffee pro- scrutiny once gram reaches Long again when Franchisees tighten their belts and Island. Franchisee SEI redefines concentrate on service as the tough economy Jack Rugen writes the distribution model with pummels c-stores and 61 percent suffer about it for Avanti. Business Transformation (BT). declines year over year. Franchisees are urged to take advan- Avanti SEI rolls out Redbox to all tage of the Work Opportunity Tax Credit. May/Jun franchised stores nationwide to 50-year fran- capitalize on the rental craze. 2010 7-Eleven app is chisee Dick Corporate redefines the multiple introduced to the Newmark, an store criteria as 60 percent of new public. The 2010 original stores are purchased by existing franchisees. agreement is in- Speedee Mart troduced with a franchisee, is SEI celebrates opening the 100th Business 10 year term and a 20 percent honored at the national Coalition Conversion Program store. franchise renewal fee. convention. 2009 2010 2011

Dr Pepper Snapple supports 7-Eleven and 7-Eleven unveils new pri- SEI realigns the division system into franchisees vate label beer, Game Day. 14 zones and moves field with Indy Car merchandising to Dallas. Sponsorship of driver Tony Kanaan.

NCASEF develops and opens the first real franchisee association website with meeting registration and web-based Avanti.

Avanti Jul/Aug FM rolls out www.FM24-7.com for franchisees to open cases online plus 2010 view invoices and site reports. NCASEF begins a three-year commit- Avanti Sept/Oct 2009 ment to Hire Heroes USA that results Franchisees recognized by Senator in more than $1 million in donations. Durbin for role in advanc- Franchisees and SEI team together to ing credit card swipe fight rising credit card fees by visiting Handpicked National Business Leadership fee reform. their congressmen in Washington, D.C. Council replaces the PLC, which was with an historic 1.7 million signatures. composed of NCASEF FOA presidents.

78 AVANTI MAY | JUNE 2015 THE NATIONAL COALITION SEI expands by 1800 stores in the 40-year franchisee Joe Galea, presi- 40 YEARS OF U.S. in 3 years while worldwide store dent of San Francisco/Monterey Bay FRANCHISEE UNITY count hits 50,000. FOA, takes the helm at the National Coalition. Franchisees achieve success with private Hot foods are the rage, but some franchisees strug- label in a number of gle with the program despite their best efforts. categories as 7-Eleven Swim Across America pushes the 7-Select brands. becomes the charity of Bills creating higher sin taxes on Chicago franchisee Jim Bayci ap- choice for its fundrais- pears on Fox News to talk about the sugar, alcohol and tobacco ing efforts. credit card swipe fee settlement. dominate legislative activity. Nationally The 2012 franchise agreement known fran- SEI begins installing DVR changes the way franchise fees are security systems, chise attorney Eric H. Karp hired as calculated. Franchisees struggle to general counsel to NCASEF. which results in all six understand Asset Protection’s role. national officers and Cleanliness surveys come under scrutiny as one Florida franchisee A record $750,000 is donated to evaluations hit oldest stores hardest. filing for mediation. Hire Heroes. 2012 2013 2014 2015

Franchisee Herb Franchisees fight maintenance rate hike Domeno and wife and SEI responds positively. Pearl honored by NCASEF for their NCASEF conducts survey of 48 years as franchisee concerns, opinions on franchisees. all topics 7-Eleven. Avanti Mar/Apr 2014 Franchisees feel the pinch on their inde- pendent contractor status as SEI uses accounting and Avanti Jul/Aug 2013 Asset Protection to NCASEF, vendors and SEI raise Hire Heroes USA, MDA as rein in the system and clamp down on $340,000 for Hire Heroes with a well as other organizations inventory and employee management. cause equity program. are recipients in a banner year of giving for the 7-Eleven piles up the acquisitions: National Coalition and FOAs Sam’s Mart, , Easy Trip, Quix, around the country. Tetco, Open Pantry, Speedy Stop, HM. Seven&I Holdings Avanti reports a 9.5 percent Jan/Feb rise in first quarter 2012 profits and focuses on U.S. expansion. SEI seeks to “reset” the relationship with the More National Coalition. National Coalition Board franchisees Labor lawyer Robert D. members meet with SEI Accounting person- become Haws talks to the Board nel for the first time in years. multiple own- about best practices in ers under a hiring and reporting. CEO Joe DePinto and changing cri- senior staff attend the NCASEF donates $100,910 teria as FM Facilities Maintenance NCASEF Board Meeting in to Susan G. Komen takes over the takes over mainte- Sandestin Florida. nance responsibilties nationwide. of Southern Arizona.

80 AVANTI MAY | JUNE 2015 Register for the 2015 NCASEF www.ncasef.com continued from page 26 Convention at

Legislative Update continued from page 56

egress, parking facilities, outdoor lighting Proposition 29, which sought to raise the advantages that can and other descriptive information re- tax by $1 a pack to raise nearly $750 mil- make them a “critical quired by the commissioner. lion. California presently taxes cigarettes component” of a successful business. • A survey The commissioner of Business Af- at $0.87 a pack. conducted by storage provider Storrage shows fairs and Consumer Protection would that 42 percent of all respondents said they California Votes To would rather use valet storage over self- then review the store’s “setting” and Raise Smoking Age “proximity to residences and hospitals” storage if both were available to them; the along with the establishment’s history of The California Senate voted recently number jumps to more than 50 percent among women, urban dwellers and millennials. • “public complaints of noise and other to raise the legal smoking age in the state An Anheuser-Busch brewery in Georgia moved disturbances” before deciding whether to from 18 to 21, a move that could make from producing cans of beer to churning grant special licenses that do not ad- California one of the states with the high- out cans of water, which was distributed to versely impact the “peace and quiet of est smoking age, reported Reuters. The those affected by flooding in the Southwest in the local community.” measure was approved by the Senate 26- 8 and must now be approved by the state late May, reported the Washington Post. • Tobacco Tax Hike Could Whole Foods is trying to change its reputation Land On California Ballot Assembly. The Institute of Medicine, the health arm of as a grocery with fresh food at high prices by A coalition of health and labor the National Academy of opening a separate chain of smaller, con- groups has submitted a pair of initiatives Sciences, has said that in- venience-focused, lower-priced stores for the 2016 ballot to raise the state’s to- creasing the smoking age aimed at millennials, reported USA Today. • PepsiCo said it is dropping the artificial bacco tax by $2 a pack, reported the to 21 would result in more sweetener aspartame from Diet Pepsi in re- Sacramento Bee. Save Lives California, than 200,000 fewer sponse to customer worries, reported the Asso- including the American Heart Associa- premature deaths ciated Press. The company will use sucralose, tion, American Lung Association, Amer- nationally for an artificial sweetener commonly known as ican Cancer Society, California Medical those born be- Splenda, to replace it. • In an effort to mod- Association and SEIU California, filed tween 2000 and ernize its domestic business, McDonald’s is two measures with the Attorney Gen- 2019. The Cigar testing delivery at 88 restaurants in New eral’s Office for titles and summaries. Association of York City through the app-based delivery Backers will likely decide later which one America op- service Postmates, reported Nation’s to take to the streets for signatures Restaurant News. • Amazon.com announced and a place on the ballot. One The Institute of Medicine says increasing its Prime Now service will offer one-hour measure allows state tax officials to delivery from local stores in addition to the impose an equivalent tax on elec- the smoking age to 21 would result in 200,000 fewer premature deaths nationally tens of thousands of items offered by Amazon. tronic cigarettes. Voters could have In Manhattan, customers can now pur- a say on tobacco tax initiative four for those born between 2000 and 2019. chase groceries, prepared meals and years after they narrowly rejected baked goods from D’Agostino, Gourmet continued on page 84 Garage and Billy’s Bakery through the Prime Now app. • Yum Brands Inc.’s Taco Bell and Pizza Hut restaurant chains plan to remove Play The Name Game! artificial flavors and colors from most of their food, joining other food companies that Look carefully at each page in this issue. Some- are opting for more natural ingredients in the where in this magazine a line is hidden that contains face of changing consumer tastes, reported the the words $Name Game Winner + person’s name + Wall Street Journal. • The Minnesota Senate city$. If you find this line, and it contains your name, voted overwhelmingly recently to end sales call AVANTI’s Offices at 215 750-0178 before the next magazine is of instant-win tickets on the Internet, at published, and win this issue’s total. NCASEF Members only. continued on page 86

82 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 83 Register for the 2015 NCASEF

continued from page 82 Convention at www.ncasef.com continued from page 84

Legislative Update Legislative Update posed the bill, contending that 18-year- that legislators say is hard to regulate. sugar leads to obesity, diabetes and tooth olds can serve in the military, vote and of salt—with a message stating: "High Bans have already been enacted by Ver- Michigan Voters Reject decay. This is a message from the City and sign contracts and should thus enjoy the sodium intake can increase blood pressure mont, South Carolina, Alaska, Delaware, Road Tax Plan County of San Francisco," the proposed right to smoke. and risk of heart disease and stroke." The Louisiana, Utah and Virginia, among oth- Proposal 1, warning label on the beverages would read. Health Department estimates about ten ers. The House passed the measure 143-2 NYC High-Sodium likely one of the The proposals would also ban adver- percent of dishes would warrant a to ban the product as of October 1. The Warning On Menus most compli- tising of sugary drinks on city property salt shaker. bill, which was approved previously by the The New York City Health Depart- Powdered alcohol cated and con- Senate, now goes to Gov. Dannel P. Malloy ment said it will consider requiring chain Connecticut Bans has been banned in fusing questions San Francisco lawmakers voted Powdered Alcohol After the sale of for his signature. restaurants to alert customers to menu Vermont, South powdered alcohol ever placed on a Michigan ballot, was to target soda and other sugar- Arizona Says Cities items that are high in salt, reported CBS The Connecticut House of Rep- was approved by soundly rejected during the May special sweetened beverages with the first Carolina, Alaska, Can't Ban Plastic Bags News. The proposed warning would apply resentatives has voted overwhelm- the federal govern- elections as many voters expressed anger at sugar warning label in the country. Delaware, Louisiana, lawmakers and state government for failing to restaurants with more than 15 locations ingly to ban powdered alcohol, ment in March, Arizona lawmakers voted in April to Utah and Virginia. to come up with a better solution to the nationwide. It would show a salt shaker joining several states across the states began re- make it illegal for cities in the state to im- sorry state of the roads, reported the Detroit and forbid city departments from buying next to any menu item with more than the country that have moved to prohibit sponding by en- pose plastic bag bans, angering municipal- Free Press. Proposal 1 would have increased sugar-sweetened beverages. A representa- U.S. daily recommended limit of 2,300 an item that has become popular among acting bans on the strong-proof alcohol ities over what they see as heavy-handed milligrams of sodium—about a teaspoon the state sales tax to 7 percent from 6 per- tive of the American Beverage Association teenagers, reported the Hartford Courant. continued on page 85 action by the state, reported the Associated cent, taken the sales tax off fuel sales, and told the San Francisco panel that “impor- Press. The same law applies similar restric- hiked fuel taxes—raising close to $1.3 bil- tant facts were missing from their discus- tions on Styrofoam containers and other lion extra for roads. sion” on the sources of obesity, such as disposable products. The measure was When fully implemented, the plan inactivity, genetics and overconsumption backed by the Arizona Retailers Associa- would have also generated about $200 of food items like pizza and burgers. There tion and the Arizona Food Marketing Al- million a year more for schools; $116 mil- was no immediate word on when the full liance, which represents brands including lion for transit and rail; sent $111 million board might act on the proposals. Safeway, , and QuickTrip. more to local governments; and given a & Oregon Kansas Senate Rejects $260-million tax break to low- and mod- To Let Motorists Pump Expanded Alcohol Sales erate-income families through restoration Their Own Gas of the Earned Income Tax Credit. The Kansas lawmakers have rejected a New Jersey and Oregon, the only two watered-down version of a plan to expand complex nature of the proposal resulted from the need to replace school and local U.S. states where motorists can’t pump alcohol sales by grocery, big-box and con- their own gasoline, could be in a race to venience stores in the state, reported the government revenues lost as a result of re- moving the sales tax from fuel sales to lose that distinction, reported Bloomberg. Wichita Eagle. Voting 26-11, the senators make room for higher fuel taxes, which Two New Jersey lawmakers have intro- turned down a floor amendment that unlike sales taxes, support roads and duced legislation to give drivers the option would have allowed the chain stores to sell transportation. Compounding the voter of self or full service at gasoline stations. full-strength beer. Under current law, they dissatisfaction, most of the details weren't The proposal comes after a measure to let can sell only beer and coolers with a max- spelled out in the ballot language. drivers in rural parts of Oregon serve imum alcohol content of 3.2 percent. Un- themselves passed the House of Represen- cork Kansas, a coalition including Dillons, San Francisco To Require tatives. New Jersey and Oregon adopted Hy-Vee and other chains, has pushed hard Soda Warning Labels bans on self- to bring a bill to the floor to allow their A panel of San Francisco lawmakers serve gaso- stores to sell hard liquor and wine as well voted recently to advance a package of laws line more as beer. They’ve been opposed by associa- targeting soda and other sugar-sweetened than 50 years tions representing independent liquor re- beverages, including what would be the first ago because tailers—the only ones now allowed to sell warning label in the country, reported of safety con- full-strength packaged alcohol. Reuters. “Drinking beverages with added cerns. n

MAY | JUNE 2015 AVANTI 85 Register for the 2015 NCASEF

continued from page 28 Convention at www.ncasef.com year, and they are increasingly turn- ing to convenience stores for these “A recent sweep of 7,571 gas continued from page 82 healthy purchases, according to stations led to the discovery gas pumps and survey results released by the Na- of 103 credit card skimmers.” through ATMs, re- tional Association of Convenience ported the Winona Daily News. • One-quarter Stores (NACS). More than six in 10 of global respondents say they are already American consumers (61 percent) say that tinel. The state’s Agriculture Commis- ordering grocery products online for home convenience stores are offering healthier, sioner said that a recent sweep of 7,571 gas delivery and more than half (55 percent) are nutritious products and serving sizes. This stations led to the discovery of 103 credit willing to use it in the future, according to the new Nielsen Global E-commerce and the New was the third consecutive year that a major- card skimmers. The devices were found on Retail Survey. • Dunkin' Donuts recently an- ity of Americans say that convenience stores gas station pumps stretching from Miami- nounced it is recruiting franchisees to de- Dade County all the way to Florida's Pan- are providing more better-for-you items. velop an estimated 10+ new Dunkin' Donuts Sales reflect growing consumer choice handle. Most were found in South Florida. restaurants throughout Mobile, AL, and Biloxi for food items in convenience stores. Nearly The Agriculture Commissioner said the and Jackson, MS. • A proposed battery swap six in 10 consumers (59 percent) and seven information about the skimmers was model developed by University of Wisconsin in 10 of those age 18-34 (70 percent) say being given to law-enforcement authori- students to increase the viability of electric that convenience stores offer food that they ties to investigate. He also said that his of- vehicles was named the winner of the Fuels In- feel comfortable eating. Foodservice sales at fice would continue to sweep through gas stitute’s inaugural Future of Transportation Case convenience stores increased 9.7 percent in stations. Competition at the Institute’s Spring Meeting in 2014, according to NACS data. In particu- New Orleans, reported NACS Online. • Seven lar, consumers are purchasing more fresh Emirates Investment, the exclusive regional and nutritious food in convenience stores. Former NCASEF franchiser of 7-Eleven, announced that it will Overall, 44 percent of Americans say that open the first 7-Eleven store in Dubai in Sep- Chairman Joins SEI tember 2015. • U.S. Millennials increased en- convenience stores offer nutritious items, SEI recently announced ergy drink consumption from 55 percent to which is a strong increase from the 30 per- that former NCASEF 61 percent from 2014 to 2015, despite the fact cent who felt that way in 2013. In addition, chairman and Tucson that 74 percent of older Millennials (consumers 43 percent say that convenience stores are a FOA president Bruce age 27-37) express concerns about product place to get fresh food items. Maples has joined the safety compared to 65 percent of consumers company as Senior Di- overall. • There is a good chance that average rector, Franchise Support Quality Assur- U.S. gas prices will drop soon due to stabiliz- Skimmers Found In Many ing crude oil costs and as refineries complete ance. SEI said Maples will provide the seasonal maintenance, which would result in franchisees’ perspective on issues across Florida Gas Stations the cheapest summertime gas prices since Florida consumers filling up at the gas the system and will report to Jeff Schenck, 2009, according to the AAA Monthly Gas Price pump may have had their credit card in- who has re-joined the company in the Report. • Costco Wholesale seems to have qui- formation stolen, reported the Sun Sen- continued on page 88 etly surpassed Whole Foods to become the biggest organic grocer, with annual sales of The National Coalition Office organic products exceeding $4 billion, reported the Seattle Times. • Altria, Lorillard and Has Moved! Reynolds American recently agreed to drop The strength of an independent trade association lies in their lawsuit over FDA rules for packaging its ability to promote, protect and advance the best inter- NCASEF Offices labels they consider as too restrictive after the ests of its members, something no single member or ad- agency issued an interim enforcement policy 740 Front Street, Suite 170 that puts a stop to that initiative until at least visory group can achieve. The independent trade Santa Cruz, CA 95060 until 30 days after the FDA issues a revised guid- association can create a better understanding between Office 831-426-4711 ance or announces its intention to not issue one. its members and those with whom it deals. National Fax 831-426-4713 continued on page 96 Coalition offices are located in Santa Cruz, California. E-mail: [email protected]

86 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 87 continued from page 86 newly created position of Vice President, market. “As a result of this acquisition, ing a competitive threat to quick-service Franchise Relations. Reynolds American has a significantly restaurants, according to Nation’s Restau- strengthened, balanced and diversified rant News. In recent research from The portfolio of iconic brands across all key cat- NPD Group, “food-forward” convenience Reynolds American egories—the most balanced in the indus- stores have increased their share of visits Completes Acquisition try,” said Susan M. Cameron, RAI’s to 17 percent of all convenience stores, ris- president and chief executive officer. ing from 12 percent in 2009. Of Lorillard Part of what’s moving the needle is Reynolds American Inc. recently an- that when evaluating intent to revisit, visit nounced it has completed its acquisition of C-Store Foodservice frequency and customer satisfaction, Lorillard, Inc., making it a wholly owned food-forward convenience stores receive subsidiary of RAI. Former Lorillard share- Threatens QSRs continued on page 90 holders will own approximately 15 percent As more convenience store chains of RAI’s common stock, the company said. focus on im- RAI’s operating companies have key brands proving food “Fiy-eight percent of consumers surveyed across major industry categories: Newport, and beverage Camel, Pall Mall and Natural American quality, they by NPD said they will definitely revisit a Spirit in combustible cigarettes; Grizzly in are growing ‘food-forward’ convenience store.” smokeless tobacco; and VUSE in the vapor visits and pos- continued from page 88 better scores than traditional quick-ser- ing products. Amazon has approached expansion in the deli department and new vice restaurants, fast-casual restaurants some private-label food manufacturers offerings in bakery including custom cake and traditional convenience stores. Fifty- seeking a partner, according to the article. decorating. Among the new features in the eight percent of consumers surveyed by Those discussions included TreeHouse deli is a pizza oven allowing custom pizzas NPD said they will definitely revisit a Foods Inc. of Oak Brook, Ill., one of the made to order. food-forward convenience store, com- larger private-label producers, with $3 bil- pared with 45 percent who said they will lion in sales last year. definitely revisit a traditional quick-ser- Getty Realty Acquires vice restaurant, 43 percent who said they 77 C-Store Properties will definitely revisit a fast-casual restau- Court Disqualifies Getty Realty Corp. announced it has rant, and 43 percent who said they will Franchisee Firm In acquired fee simple interests in 77 conven- definitely revisit a traditional convenience ience store and retail motor fuel stations store. More than 56 percent of food-for- 7-Eleven Case located in several high growth regions in- ward convenience store customers said A district cluding Northern California, Southern they visit more than once a month, while judge in April California, Colorado, Washington, Ne- only 37 percent of traditional quick-ser- ruled that Gerard vada and Oregon for approximately $214 vice customers and 19 percent of fast-ca- "Jerry" Marks and million. The acquired properties operate sual customers said the same. his law firm under several well-recognized brands— Marks & Klein including 76, Conoco, Circle K, 7-Eleven are disqualified and My Goods Market—and were ac- Amazon Plans To Expand from further participation in a franchisee quired from affiliates of Pacific Conven- lawsuit against 7-Eleven, Inc., claiming un- Private-Label Brand ience and Fuels LLC and simultaneously lawful termination, reported Blue Mau- Amazon.com Inc. is preparing to leased to United Oil, a leading regional Mau. The judge’s decision was centered on broadly expand its lineup of private-label convenience store and gas station opera- how Marks paid a witness, a former em- brands to include an array of grocery items tor. The company said it expects to receive ployee of 7-Eleven's Asset Protection de- such as milk, cereal, baby food and house- approximately $16.7 million of annual partment, to testify against the convenience hold cleaners, reported the Wall Street Jour- GAAP revenue from the transaction. store franchisor on how it treats franchisees nal. Amazon’s planned expansion in the in the case of Dilip Patel v. 7-Eleven, Inc., private-label business mirrors a more tradi- filed in March 2013. Jerry Marks told Blue tional retail model where name-brand Mexican C-Store Chain MauMau he plans to appeal the court rul- products are sold beside store-owned goods. ing, and said even if the decision stands Considers Expansion Earlier in May, Amazon sought trademark against him and his firm, the case will con- protection for more than two dozen cate- In Texas tinue to go forward. gories under its Elements brand, including 's biggest convenience store coffee, soup, pasta, water, vitamins, dog food chain operator, FEMSA, said it is consid- and household items like razors and clean- Wal-Mart’s Neighborhood ering a major expansion in Texas if it is successful in a bid for a license to sell al- Market Turns Focus To coholic beverages in the state, reported Hot Foods Dow Jones Business News. FEMSA—as Fo- mento Economico Mexicano SAB is better Wal-Mart is putting a bigger empha- known—said it could invest $850 million sis on hot foods at a new Neighborhood over 10 years to open 900 stores in Texas Market location in Arkansas and is taking if the permit is granted. The company said "a step up" with new deli and bakery offer- it has presented arguments for U.S. au- ings as part of an effort to elevate service thorities to consider a modification in the and choices for shoppers, reported Super- current law to allow FEMSA to sell alcohol market News. The new store will feature an continued on page 92 90 AVANTI MAY | JUNE 2015 Register for the 2015 NCASEF Convention at www.ncasef.com continued from page 90

in Texas. FEMSA is the parent company of recently after pleading guilty to a scheme devices today than a year ago, but most of 's biggest soft-drink bottler, involving wire fraud and the housing and those consumers are also smoking con- Coca-Cola FEMSA SAB, and operates employment of illegal immigrants, re- ventional cigarettes, reported Reuters, cit- more than 13,000 Oxxo convenience ported The Southampton Press. In addition ing its new Reuters/Ipsos poll. The stores in Mexico. The company also owns to his jail sentence, franchisee Farrukh findings support evidence that smokers a 20 percent stake in Dutch brewer Baig was ordered to forfeit his rights to the are using both traditional tobacco prod- Heineken. 14 7-Eleven stores he owned, as well as five ucts and e-cigarettes to deliver nicotine, houses on Long Island, worth a total of rather than giving up traditional cigarettes $1.3 million, where the illegal immigrants altogether. Franchisee Sentenced In were housed. Baig was also ordered to pay About 10 percent of U.S. adults now Immigration Case $2.5 million in restitution for the wages he vape, according to the online Reuters/Ipsos stole from workers. poll—that's almost four times higher than The owner of several 7-Eleven stores a U.S. government estimate that 2.6 percent throughout Virginia and Long Island was of adults used e-cigarettes in 2013. The sentenced to more than 7 years in prison E-Cig Use Surges In survey further reveals that about 15 per- Past Year cent of poll participants under the age of “Mexico’s largest c-store chain FEMSA 40 now vape. In 2013, 18.8 percent of those Significantly more Ameri- 18 to 24 and 20.1 percent of those 25 to 44 could open up to 900 stores in Texas cans are using electronic ciga- smoked cigarettes, according to the gov- in the next 10 years.” rettes and other vaporizing ernment data.

MAY | JUNE 2015 AVANTI 93 Vendor Guest Column

BACK INJURIES—WHY IT HURTS, AND WHAT YOU CAN DO ABOUT IT

By John Harp Risk Engineering Consultant, Mitsui Sumitomo Insurance Group

What if you or one of your most valued “Do you know water weighs employees suffers a back injury and is un- able to work? Employee back injuries can 8.34 pounds per gallon?” occur in the store from lifting, pushing- pulling, slip and falls, and repetitive motion. • Handling full trash bags Suggestions To These injuries rarely occur from one isolated • Repetitive bending to floor while Prevent Back event, as it’s frequently an accumulation of stocking Injuries small events over days and even years. Back • Standing at the register on hard floor • Train your employees in safe lifting, injuries are one of the most costly injuries to for an extended period and encourage stretching and fitness. business and are a common cause of work- • Pushing cases of milk inside the cooler • Most employees should not lift more ers compensation claims at 7-Eleven. • Overhead reaching for crate of dry than 25 pounds without help. The cost of a back injury can be signif- goods • Bag in a box—keep full boxes off the icant because of medical bills, continuing Safe Lifting Guidelines floor or stored above shoulder height. therapy, lost time and in serious cases the • Is it the right person to be handling the Heavier concentrate boxes should be employee may be unable to return to load? stored the same way. their regular duties. • Plan the lift—where will the case or • BIB’s should be replaced during shifts Since January 1, 2010 the MSIG Fran- product go? with 2 employees. chisee Insurance Program has incurred • Check the load—is it as heavy or light • Stock rooms and cooler should have costs of $4,183,911 from 294 back in- as expected? clear space to allow for proper juries. Although not the most frequent • Know your limits—get help. lifting/handling methods. type of injury, it is the most costly at • Get a good grip. • Incoming deliveries should be placed $14,230 per claim. • Bend your knees, not your where employee can easily access. Here are examples of waist. • Encourage milk and other crates be de- franchisee store back • Hold the item close (fully ex- livered only 4 high. injury claims: tended arms can increase the • Keep crates stocked in the cooler 4 • Employee lifting cases of water— load by 10 times—for example high or less. $90,237 an 8 lb. jug of milk is like 80 • Crates or case goods should be kept on • Employee handling a case pounds at the base of the small dollies in the cooler for easier of milk in the cooler— spine). movement. $8,920 • Move your feet—do not • A long handled hook device should be • Employee throwing twist at the waist. used to reduce reaching for lightweight trash into the dump- • Avoid lifting heavier items items. ster—$20,425 (e.g. 5 gallon BIB) from • Stocking lower shelves should be done Common Causes below the knees or above using a small chair or stool, or a kneepad Of Back Injuries In the shoulders. on the floor to minimize bending. The Stores • Follow the same rules • Use a sturdy stepstool to reach high shelves. • Lifting bag in a box when lowering items. • A small cart can help move product (BIB) • Wear sturdy shoes around the store. • Moving cases of beer or soda with a cushioned in- sole. continued on page 96 94 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 95 Vendor Guest Column

continued from page 95 “Do you know a 24- continued from page 86 • Wal-Mart is updating its dress code to let store workers count case of bottled wear denim, seeking to appease employees who’ve com- beer can weigh plained about the required wardrobe, reported Bloomberg Business. • Furniture retailer IKEA plans to spend 1 billion euros ($1.13 billion) on re- 35-40 pounds?” newable energy and steps to help poor nations cope with climate change, the latest ex- ample of firms upstaging governments in efforts to slow warming, reported Reuters. • Last year, more than $388 million was raised for charitable causes through point- • Trash bags should be emptied of-sale donation campaigns at retailers and restaurants, reportedJOHN NACS HARP Online. • Chipotle Mexican Grill Inc. recently expanded benefits formerly reserved for salaried work- frequently, especially if there CAN BE REACHED AT ers—including full tuition reimbursements, sick pay and paid vacations—to all employ- are wet coffee grounds. [email protected] ees, reported Nation’s Restaurant News. • Coca-Cola said it plans to cut its calories per • Dumpsters should have a fold liter 10 percent by 2020 as consumers continue a shift toward healthier beverage op- down side so employees don’t have to toss trash tions, reported the Wall Street Journal. The company said it also plans to cut its carbon bags over the top. footprint in half by 2020, having already reduced it by 29 percent since 2007. • U.K. super- • Keep floors clean and dry—a slip can result in a market chain said it will start giving its unsold food to charities like women’s back strain. refuges, homeless hostels and breakfast clubs for disadvantaged children, reported • A cushioned mat at the registers can improve Sky105. The company said it threw away 55,400 tons of food last year, around 30,000 back health. tons of which was perfectly edible. • Casey's General Stores will add online ordering A well informed and well prepared staff can help to 300 stores per month, with a goal of having the option in place at all 1,878 Casey's c- stores by the end of 2015, reported Convenience Store News. • The Edison Electric Institute you prevent back injuries in your store. If you need and the Department of Energy have announced a new private-public partnership to assistance with back injury prevention resources, promote and accelerate the nationwide adoption continued on page 113 please contact me at [email protected].

MAY | JUNE 2015 AVANTI 97 98 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 99 Register for the 2015 NCASEF Convention at www.ncasef.com

FIRST U.S. AIRPORT ing 7-Eleven franchisees who want to grow their retail business by adding TERMINAL 7-ELEVEN stores. Because the stores qualifying as STORE OPENS Zero Franchise Fee opportunities are The first 7-Eleven store located inside considered low volume, the company a U.S. airport terminal recently opened at said they may qualify for additional, lim- Los Angeles’ International Airport (LAX) ited-time financial support. with a selection of products and services tailored to travelers and airport employ- franchised or in the approval process. OPERATION: TAKE COMMAND ees, SEI announced. The company, West- Under the program, SEI waived the fran- CONTEST WINNERS field and LS travel retail North chise fee on select U.S. 7-Eleven stores SEI announced that all three finalists America—the concessionaire operating available for franchise, a savings of up to of Operation: Take Com- this new location—held a grand opening $80,000 per store. There were ap- mand, the contest to on June 24. 7-Eleven’s inaugural U.S. air- proximately 250 eligible stores lo- award a U.S. military vet- port terminal location is in the pre-secu- cated across the country, including eran a 7-Eleven store, rity arrivals level of the Tom Bradley greater Charlotte, N.C., where 7- were selected as win- International Terminal. Eleven acquired a significant num- ners. Active-duty U.S. Designed for both traveler and airport SEI's Zero ber of stores in Army Captain Robert 2012. Other employee needs, the store is built accord- Franchise Kemna of Miami ing to 7-Eleven’s modern and sophisti- areas where spe- Fee Initiative (currently stationed at cated take on the brand’s famous design. cific Zero Fran- Fort Bragg, N.C.), The facility’s color palette and finishes ended on June chise Fee stores Army veteran Salil were specifically selected to highlight 7- 30, with 67 were available in- Gautam of Chesapeake, Va., Eleven’s fresh food, which is made in local stores being clude Dallas/Fort and U.S. Navy veteran Mark Anthony kitchens and delivered to the store daily. franchised or Worth, Manhattan, Page of Granbury, Texas, will all become Baltimore, Rich- Unlike the typical non-stop 7-Eleven in the approv- business-owners of their own 7-Eleven store, however, this location’s operating mond, Va., Port- al process. franchise. hours are from 6 a.m. to midnight. land, Ore., Orlando As the last step in the almost six- and Jacksonville, month long contest, the three finalists Fla. These stores typically interviewed with 7-Eleven President have lower sales volume and CEO Joe DePinto, an Army veteran compared to the national himself, at the company's home office in average. continued on page 102 Over the last four years 7-Eleven has added more than 1,300 units in the U.S. Now that a 7-Eleven cus- tomer base has been estab- lished at these locations, the company ZERO-FRANCHISE-FEE said it is looking to transition these stores 7-ELEVEN STORES from company to franchise operations. SEI's Zero Franchise Fee Initiative SEI said it offered these stores to prospec- ended on June 30, with 67 stores being tive, qualified franchisees as well as exist-

100 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 101 Register for the 2015 NCASEF Convention at www.ncasef.com continued from page 100

Dallas. So impressed was he by the cal- •Sonos Play:5 sound systems iber of the three Operation: Take Com- • Beats by Dre headphones mand finalists that DePinto made an refills count toward 7Rewards' Buy 6-Get • Fender guitars on-the-spot executive decision to give 7 free drink program available exclusively • Ticket vouchers for the summer's all three a store. "How can you pick just through the 7-Eleven mobile app. hottest music events one winner when you have three?" De- SEI also unvelied the current featured • 3-month subscriptions to Spotify Pinto asked. "I was extremely impressed Slurpee flavor exclusive to 7-Eleven • iTunes gift cards by each one of them—for overcoming stores—Mtn Dew Solar Flare. The bright adversity, serving their country self- red-orange drink has the bold citrus fla- • Music downloads lessly, having a heart for service and vor of Mountain Dew with a blast of trop- • Slurpee swag like exclusive All Access demonstrating outstanding leadership ical punch. Mtn Dew Solar Flare was Chill T-shirts and sneakers qualities. These are the kind of folks we introduced last summer as an exclusive— want in the 7-Eleven system. They are and very popular—Big Gulp flavor, and MICHIGAN, OHIO STORES all too deserving not to win.” made its debut in Slurpee-form this year. OFFER FAYGO ROCK & ANIMAL SLURPEE STRAWS SLURPEE ALL ACCESS RYE SLURPEE The Faygo Beverages Inc. is offering & NOVELTY CUPS CHILL SWEEPSTAKES their popular Rock & Rye drink in In late May SEI introduced limited- SEI recently Slurpee form at 7-Eleven stores in Michi- edition Slurpee straws with muzzles, launched the Slurpee gan and Ohio, reported the Detroit News. snouts and beaks based on four popular All Access Chill The spiced, vanilla cream flavor joins spirit animals—the eagle, fox, wolf and sweepstakes, which Redpop, Faygo’s iconic strawberry soda cat. The straws retail for $1.49 at partici- runs through July 18. and flagship flavor. Faygo Beverages and pating stores. Accompanying the col- The contest gives 7-Eleven started selling Redpop Slurpees lectible straws are new novelty Slurpee music lovers the at about 300 Michigan and Ohio stores cups reminiscent of vintage glass milk chance to win tickets in March. In May of last year, local 7- bottles. Suggested retail price for the re- to top concerts, ex- Eleven stores unveiled the Vernors fillable, plastic cup is $2.99 and that in- clusive trips to music festivals across the Slurpee, featuring the flavor of another cludes the first Slurpee fill. SEI said both country, music downloads and once-in- iconic Detroit-created soft drink. Metro the initial refillable cup purchase and all a-lifetime music experiences. During the Detroiters have a thirst for 7-Eleven sweepstakes, every Slurpee drink pur- Slurpees—customers in the region con- chase and scan of the 7-Eleven app sume more Slurpees than in any other member's barcode is an entry to win ac- market in the nation, according to 7- cess to the more than 17,000 prizes, Eleven officials. n some of which offer exclusive Slurpee All Access Chill music-related experi- Metro Detroiters consume ences like: more • A meet-and-greet with pop star Austin Slurpees Mahone than in • Exclusive VIP trips to one of five top any other music festivals market • A "festival makeover" with a top Hol- lywood stylist in the • An album cover-style photo shoot nation.

102 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 103 Cold Stone Creamery Milk • All Sour Patch Kids Candy 2 ounce bags are 2 for Shakers In Three Flavors $2.00 Cold Stone Creamery Milk Shakers are rich, thick, and creamy • All Sour Patch Kids ready-to-drink premium shakes. They are available in three delicious Candy 5 ounce bags flavors for your 7-Eleven business! The award-winning Chocolate are 2 for $2.50 Expect big sales with new Fudge Brownie (SLIN 151179) will be sure to satisfy the chocoholic in • All Stride Gum single Sour Patch Watermelon Slurpee and 2-for promotions. your customers, and Strawberry Swirl (SLIN 150083) provides just the packs are 2 for $2.00 right amount of ripe strawberry sweetness. The newest Cold Stone Discover what happens when two pop-culture Creamery Milk Shakers addition, Coffee Caramel Dream (SLIN icons come together—the sour of Sour Patch Kids, 150142), blends smooth coffee and decadent caramel in a conven- continued on page 106 ient on-the-go bottle. Each flavor is made with the finest, high quality ingredients and will truly add some NESTLÉ PROFESSIONAL indulgence to your day. Visit www.coldstone- milkshakers.com or call 1-800-891-0500 for ANNOUNCES COFFEE-MATE more information. FOA CONTEST Nestlé Professional has announced a new Coffee-Mate incentive contest exclusively for 7-Eleven FOAs. The top three FOAs that increase their Coffee-Mate pump bottle purchases from May 1 to September 30 will receive: 1ST PLACE 2ND PLACE 3RD PLACE $4,000 $2,500 $1,000

All you have to do to be eligible is order Coffee-Mate pump bottles in your stores! The winning FOAs will be Cold Stone Creamery Milk Shakers, announced after September 30 and a check will be high quality in three flavors. made out to those associations.

7-Eleven Sour Patch Help your FOA win by ordering New products and services for 7-Eleven Franchisees Coffee-Mate pump bottles for Watermelon Slurpee your store today (Sweetened Just in time for summer, the sour-then- Original—UIN 341578, UPC sweet sensation of Sour Patch Kids now comes in a Slurpee. Just like the widely popu- 50000933327; French lar Sour Patch Kids candy, this exclusive, lim- Vanilla—UIN 341545, UPC ited-time Slurpee flavor starts out sour and 50000933488; Hazelnut— ends up sweet with juicy, mouth-watering, UIN 341594, UPC watermelon flavor. Expect a strong base of pre-existing Sour 50000933600). Please con- Patch Kids fans to create large-scale excite- tact Susan Davis with any ment, while valuable offers generate big-time questions at sales during the promotional period: [email protected].

104 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 105

continued from page 105 the sweet taste of watermelon and the shockingly cold refreshment of around for a limited time. Available now for shipment, Swisher Sweets Slurpee. It’s more than a beverage, it’s an entire sour, sweet summer- Summer Twist comes in a resealable 2-count pouch with the “Sealed time experience. Let the summer of Sour and Sweet begin! Fresh” guarantee. Summer Twist will be available in “2 for 99¢”and “Save on 2” options. Just like the summer, Summer Twist won’t last long. Swisher Sweets Schmidt's New Bahama Mama is continuing to introduce popular limited tastes throughout 2015. For Fajita Sausage Link more information or to place an order today, contact your Swisher rep- Schmidt's Bahama Mama’s resentative at 1-800-874-9720. new Gourmet To Go Fajita Sausage Link is made of the good2grow Adds best cuts of beef and pork melded with Hatch Peppers, Grape & Fruit Punch To Monterey Jack Cheese and a Juicy Waters Line flavorful blend of Fajita spices Word at the cooler door is good2grow creating a distinct spicy flavor. sales are giving retailers a healthy boost. Fajita Sausage Links on a These quality sausages roll $2 per case intro allowance. New Grape and Fruit Punch Juicy Waters are on the roller grill up to 5 getting rave reviews from moms and kids hours without degradation or retail in the cooler. Available now on a alike. In the first month, both flavors are al- $2 per case intro allowance (UIN 244301, 10 1-lb packages). ready generating over two times the weekly dollar sales of other leading children’s juice Limited Edition Calypso beverages without promotion. Only good2grow provides healthy hydration with Cream Cigarillos cool character tops that moms and kids can’t Swisher Sweets offers an unforgettable journey of good2grow new Grape and resist. With an average c-store profit of $1.44 Fruit Punch Juicy Waters. enchanting blends with its newest limited-edition ciga- per bottle, all that growth adds up to impres- rillo: Swisher Sweets Calypso Cream. Customers will sive profits for good2grow retail partners. love the magical blend of Oranges and Sweet Cream, with a slight hint of Blueberry to complete the taste. Swisher Sweets Calypso Cream begins shipping to Vitaminwater participating stores nationwide beginning July 1, Introduces 2015. They are packaged in resealable 2-count foil pouches with the “Sealed Fresh” guarantee, and are Summertime available in “2 for 99¢”and “Save on 2” options. Flavors Swisher Sweets limited edition cigarillos are avail- Swisher Sweets Just in time for summer, Vitaminwater Calypso Cream able while supplies last. For more infor- recently introduced two new varieties: Vit- Cigarillos in mation and to place your order today, aminwater Refresh (tropical mango fla- 2 for 99¢ and contact your Swisher representative at Save on 2 options. vored + other natural flavors) and 1-800-874-9720. Vitaminwater Vital-T (lemon iced tea fla- vored + other natural flavors). Both new Fast-selling Popular Summer varieties bring a delicious and refreshing Vitaminwater Refresh Swisher Sweets summertime vibe to the Vitaminwater line- and Vitaminwater Vital-T, Summer Twist is Twist Is Back new for summer. available for a lim- up. Vitaminwater Refresh and Vitaminwater Swisher Sweets Summer Twist ited time only. Vital-T are available in 20 fl. oz. bottles (most common suggested retail limited edition cigarillo was so pop- price for 20 fl. oz. is $1.59). ular last year that it’s back for a re-release this sum- continued on page 108 mer. This sweet lemon mango taste will only be

106 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 107 continued from page 106

Vitaminwater XXX sonal offering that is guaranteed to excite consumers—White Owl Very Berry. White Owl quality cigarillos bursting with berry Available Nationally flavor are sure to be a consumer favorite this summer. This sea- For Big Gulp sonal offering’s unique flavor and eye-catching packaging will be available in two formats: 2/$.99 and “Save on 2 Cigars” FoilFresh Vitaminwater XXX will be available nationally for pouches while supplies last. Big Gulp by July 1, providing your guests with a great- tasting, nutrient enhanced water beverage fountain option. Look for in-store merchandising messages via Dannon Oikos Triple Zero Yogurt the Big Gulp Vitaminwater translite, window banners, For Men & Women pole signs, windmaster and pump toppers. There will be To answer many consumers’ desire for a protein snack with a advertising in select markets and a national digital stronger nutritional profile, Dannon has created a first-of-its-kind yo- media campaign supporting Vitaminwater, with specific gurt— new Oikos Triple Zero. Unlike some other protein snacks, communication driving consumers to 7-Eleven in strong Vitaminwater XXX is Oikos Triple Zero Greek Nonfat Yogurt packs in 15 grams of protein Big Gulp markets like New York City, Washington D.C. now available for with zero added sugar, zero artificial and Denver. Vitaminwater Big Gulp contains 120 calo- Big Gulp. sweeteners and zero fat. Available in six ries per 32 fl. oz with 1/3 cup ice. Nutrition enhanced flavors—Vanilla, Coconut Crème, Straw- water beverage nutrients and levels differ for bottled Vitaminwater. For berry, Banana Crème, Mixed Berry and fill nutritional information, visit vitaminwater.com/fountain. Peach—the new yogurt appeals equally to both men and women. In an effort to en- Swedish Match Releases New gage with a wider audience, Dannon be- Game & White Owl Cigarillos came the Official Yogurt of the NFL and supports the product with a multi-million Boost summertime tobacco sales with three new dollar media investment, engaging in inte- Swedish Match cigarillos: grated partnerships with television net- Game Leaf—Game Leaf is targeted to value con- works with a high male viewership. Oikos scious Rolled Leaf segment users and provides retail- Oikos Triple Zero Triple Zerois line priced with Dannon SS Greek to Greek Nonfat Yogurt ers with a complement to premium Garcia y Vega’s drive trial, and its package is designed to clearly appeals to both men 1882 award winning brand that was launched in communicate proposition benefits and features. and women. 2014 in the Swedish Match brand portfolio. Game Leaf will be available in four exciting flavors (Sweet Aromatic, Wild Berry, Natural and Cognac) in two dif- Papaya Mango Green Tea— ferent value price points: 2/99¢ and “Save on 2” Foil- A 7-Eleven Exclusive Fresh pouch. Cooper Tea, 7-Eleven’s premium Game Watermelon—Splash into summer with a re- fountain iced tea partner since 2003, freshing twist on your favorite Game Cigarillos, in- launched the new Papaya Mango Green troducing the latest limited time offer, Game Tea in the Heartland Region in May. Watermelon. Rich in flavor, watermelon combined Feedback was solicited prior to the New cigarillos with Swedish Match’s natural leaf wrapper make a launch and franchisees loved the blend just in time for winning pair. Watermelon is an exciting seasonal flavor summer. of natural papaya and mango flavors in iced green tea, saying it clearly that is unique to the marketplace and will be available tasted like a more premium product and that you could tell it doesn’t in two formats: 2/$.99 and “Save on 2 Ci- have any preservatives, high fructose corn syrup, or artificial flavors. gars” FoilFresh pouches This type of non-carbonated beverage with better ingredients is while supplies last. White Owl Very definitely the wave of the future for beverage fountains. Carbonated Berry—White Owl intro- soft drink sales across the U.S. have been on the decline over the past duces another fresh sea- 10 years, and all-natural drinks are increasingly popular with U.S. con- continued on page 111 108 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 109 continued from page 108 continued from page 110 You Take Care Of Business, AON RISK SOLUTIONS HR PILOT sumers. Iced tea sales have been in- Dual-Flavored We Take Care Of Human Resources! creasing every year, and flavored iced teas are especially Tic Tac Mixers Running your business should be, and is, your number one prior- popular with the ity. There are many things that go into running a successful fran- Introducing Tic Tac younger Millen- chise, and one of the most important is human resources. Every Mixers, the newest ad- decision you make regarding your employees is a potential HR nial genera- dition to the Tic Tac nightmare: i.e., scheduling, meal breaks, pregnancy leaves and tion. family of products. medical leaves. Premium Available in Cherry- The law is complicated and the correct course of action isn’t al- teas on the Cola and Peach- ways obvious, which is why Houston Casualty created HR Pilot. fountain typi- Lemonade, Tic Tac cally carry higher Costly Employment Law Mistakes Mixers feature two excit- “Worse yet, profit margins than ing flavors in every piece. The Tic Tac Mixers feature two Can Ruin Your Business bottles or cans. Thou- first delicious flavor layer of Tic exciting flavors in every piece. Did you know that there are federal these laws are constantly changing, making sands of franchisees already carry B.W. Cooper’s Tac Mixers delights you as it “There are federal Organic, All-Natural Unsweetened Tea and B.W. B.W. Cooper’s Papaya and state laws governing every aspect it nearly impossible to keep up.” Mango Green Tea is a new touches your tongue. As you let it melt in your mouth, Tic Tac and state laws of the employee/employer relationship? Cooper’s Sweet Tea (made with cane sugar). The all-natural fountain iced Mixers transitions to a great tasting flavor combination that governing every From the moment an applicant walks in What Franchisees Have to Say company is pleased to offer this exciting new tea, made exclusively for will surprise your senses. Be sure to keep an eye out for this aspect of the your store to apply for a job, until the About HR Pilot flavor exclusively to 7-Eleven. 7-Eleven. fun new product. employee/employer moment that an employee quits or is terminated, there are a whole host of Why do franchisees take advantage of HR Pilot? relationship. From laws you must follow. Worse yet, these “Because we don't have an HR 'expert' within our team and the moment an laws are constantly changing, making it need advice/clarification on issues that arise.” – B. Poole applicant walks nearly impossible to keep up. “I like to use your service as a backup as well as a resource to an- into your store to Ignorance of the law is no excuse. swer questions regarding HR matters by using your online sup- Courts don’t care whether or not you port with FAQs, downloads, seminars, and so on. If new apply for a job, intended to violate the law—intent and regulations are coming up I like to see what information you pro- until the moment knowledge are irrelevant. An innocent vide about deadlines … and legal requirements.” – D. Johann that employee mistake can easily cost you $150,000, Does HR Pilot Answer My Questions Quickly? quits or is termi- and that’s if it doesn’t go to trial! “I use the service frequently for all of my HR needs and am nated, there are a What Does HR Pilot Provide? pleased with the sensitivity and professionalism Bernice shows along with doing so in a timely manner.” - L. Lujano whole host of laws Our philosophy is simple: we help you with everything HR-related to re- “Thank you for your very quick response. The information was you must follow. “ duce your risk of getting a claim. Over extremely helpful. This is a very valuable tool to have access to as each day can be a new experience. Your service was the years we have come to understand the unique needs and prob- great!” – J. Bergren lems of franchisees, making our service specially tailored to meet your needs. Return On Investment How we help: With HR Pilot you have a team of HR experts at your fingertips, • Handbooks for your specific state training programs, handbooks and much more. No need to pay a • HR experts available to answer your questions by phone or email lawyer to prepare and review your handbook, no need to pay an HR consultant to help with the daily HR issues of your business and • Access to HRPilot.com for required posters and forms peace of mind. It’s money well spent. • Continual legal updates for your state Any single part of HR Pilot’s services pay for the EPLI policy— • Help with medical leaves, workplace investigations, company poli- plus you get the benefit of insurance against a claim. cies and procedures To learn more about HR Pilot and how to get this complimen- • Sexual harassment training for your entire workforce, managers tary service from Houston Casualty, please call Tonya Leffall of AON and employees Risk Solutions at 1-800-527-9034.

110 AVANTI MAY | JUNE 2015 continued from page 114 continued from page 96 Advertiser’s Index of electric vehicles. • FedEx Pacific Northwest FOA foa events FOA Board 7-Eleven Inc...... 98-99 Express announced it will Holiday Party Anheuser Busch...... 32 extend its services to more Aon Risk Services Southwest...... 36 (location to be announced) Metro New Jersey FOA than 5,000 7-Eleven stores in Taiwan, reported Post & Parcel. December 5, 2015 Argo Tea ...... 67 This brings FedEx’s total network of retail service points in Tai- Holiday Party Meeting Dates Bazooka/Topps ...... 88 Phone: 253-476-2548 Blue Bunny...... 37 wan to more than 6,300. The service will also allow Taiwanese (location to be announced) Bug Juice...... 81 customers to pick up their FedEx-delivered packages at a South Florida FOA December 19, 2015 7-Eleven FOAC San Diego FOA Campbell's ...... 93 local 7-Eleven. • Mondelez International recently announced a Table Top Trade Show Phone: 908-232-1336 global partnership with ChannelSight that will help accelerate Phone: 312-944-5392 Phone: 619-713-2411 Coca-Cola...... cover2 (location to be announced) Coopers Tea...... 77 its e-commerce growth. Mondelez plans to add "Buy Now" August 20, 2015 July 16, 2015 December 5, 2015 FOA Of Greater Los Angeles Dannon Yogurt...... 97 buttons to owned, earned and paid media platforms link- September 17, 2015 August 20, 2015 Phone: 954-465-6896 & San Diego FOA Dean Foods ...... 79 ing to over 130 retailers' websites to make it easy for consumers October 22, 2015—General Meeting September 2015—General/Safety Meeting Don Miguel...... 34 2016 Trade Show to find and buy Mondelez products online. • TravelCenters of San Francisco/Monterey November 19, 2015 October 15, 2015 Dr Pepper Snapple Group ...... 21 America (TA) announced that it has struck a deal with Hospi- Bay FOA Holiday Party Pechanga Resort and Casino December 17, 2015 November 19, 2015 Duracell...... 57 Temecula, California Ferrero...... 11 tality Properties Trust (HPT) for sale leasebacks of 30 travel Royal Palace Hotel January 20, 2016 FM Facility Maintenance...... 84 centers for about $397 million. As part of the agreement, TA Central Florida FOA San Francisco/ San Francisco, California Phone: 909-822-4122; good2grow...... 101 also will purchase five travel centers now leased from HPT for Phone: 407-683-2692 Monterey Bay FOA December 5, 2015 619-713-2411 Hain ...... 94 nearly $45 million. • Fuel transfer pump manufacturerTuthill Phone: 650-996-9479; July 16, 2015—Board Meeting Orlando Phone: 510-693-1492 Heineken...... 14 recently unveiled an industry first: a truly portable, handheld, UL 408-499-3941 August 20, 2015—General Meeting Lakeland July 14, 2015 Hershey...... 7 listed explosion-proof DC fuel transfer pump for use with Register for the Hostess ...... 91 October 22, 2015—Board Meeting Lakeland August 11, 2015 gasoline and other flammable liquids. • April U.S. manufactur- Greater Seattle FOA 2015 NCASEF November 19, 2015—General Meeting Orlando Hot 'N Spicy...... 54 September 8, 2015 Inventure Foods...... 104 ing technology orders totaled $384.81 million, down 8.1 per- Holiday Party Convention at October 13, 2015 cent from March’s $418.67 million according to the Association Northern California FOA Johnson&Johnson ...... 38 With Tabletop Trade Show November 10, 2015 Kellogg's...... 4 for Manufacturing Technology. December 12, 2015 www.ncasef.com Phone: 916-782-4144 Kraft...... 69 Phone: 425-308-1216 August 19, 2015 South Florida FOA Kretek International ...... 52, cover 4 September 16, 2015 Phone: 954-465-6896 Logic Ecig...... 58-59 October 21, 2015 Mars Chocolate ...... 12 September 10, 2015 Mars Ice Cream...... 19 November 18, 2015— FOA Election and Meeting November 5, 2015 Maruchan...... 17 McLane ...... 46 FOA Of Greater LA Southern California FOA Mondelez...... 73 Phone: 951-766-7490 Phone: 626-255-8555 Monster...... 29 August 18, 2015—w/Mini Trade Show July 8, 2015 National Tobacco...... 51 September 15, 2015 Nestle Confections and Snacks...... 71 August 12, 2015 Nestle Ice Cream ...... 41 October 20, 2015 September 9, 2015 Nestle Professional ...... 75 November 17, 2015—w/Mini Trade Show October 14, 2015 Nestle Waters...... 8 December 2015—No Meeting November 11, 2015 NY Times...... 109 P&G ...... 89 Greater Seattle FOA Southern Nevada/ Penzoil ...... 107 Phone: 425-308-1216 Pepsi Brisk...... 30-31,42-43 Las Vegas FOA Pepsi Gatorade...... 48 July 9, 2015—Dinner Meeting Phone: 702-249-3301 Perfetti Van Mele ...... 9 July 22, 2015—Board Meeting August 13, 2015—Board Meeting Red Bull...... 103 October 2015—Board Meeting (exact date TBD) August 27, 2015—General Meeting Santa Fe Tobacco...... 87 Shamrock...... 20 November 11, 2015—Dinner Meeting September 10, 2015—Board Meeting December 2, 2015—Board Meeting Simply Orange...... 22-23 October 8, 2015—Board Meeting Smoky Mountain Snuff...... 92 Metro New Jersey FOA November 12, 2015—Board Meeting Steuben Foods...... 96 November 19, 2015—Board Elections Storck...... 111,113 Phone: 908-232-1336 Swedish Match ...... 6,44 All meetings include tabletop trade shows. Swisher International...... 10,63 Vendors are welcomed to participate. Unilever Good Humor/Breyers ...... 3,5,65 September 17, 2015 White Castle...... 83 November 19, 2015 Whitewave Foods ...... 13 Windsor...... 27 Wrigley...... cover 3

112 AVANTI MAY | JUNE 2015 Southern California FOA foa events Golf Tournament TPC Valencia Valencia, California NCASEF Want your event listed here? Send September 14, 2015 email with event name, location, Phone: 626-255-8555 dates and contact phone and email to Tristate FOSE Association [email protected] Charity Golf Tournament board Little Bennett Golf Course 7-Eleven FOAC Clarksburg, Maryland Charity Golf Tournament September 16, 2015 meetings (date & location to be announced) Phone: 301-572-6811 July 2015 San Diego FOA Phone: 847-971-9457 National Coalition Board Vender Appreciation Event of Directors Meeting Greater Seattle FOA (date & location to be announced) Sheraton Chicago Hotel and Towers Golf Tournament October 2015 Chicago, Illinois Phone: 619-713-2411 (location to be announced) July 26-27, 2015 August 3, 2015 7-Eleven FOAC Phone: 425-308-1216 NCASEF 40th Annual Holiday Party & Trade Show Convention & Trade Show Rocky Mountain FOA (location to be announced) In Cooperation With The Charity Golf Tournament November 6, 2015 Phone: 847-971-9457 Chicago FOA & Alliance of Colorado Country Club Cheyenne Mountain Resort FOA Of Greater LA 7-Eleven Franchisees FOA Colorado Springs, Colorado Holiday Party Sheraton Chicago Hotel and Towers August 5, 2015 Chicago, Illinois (date & location to be announced) Phone 719-233-9758 July 27-31, 2015 December 2015 Rocky Mountain FOA Phone: 619-726-9016 Trade Show: July 30-31, 2015 Trade Show Central Florida FOA Hotel Elegante Holiday Party Colorado Springs, Colorado (date & location to be announced) August 6, 2015 December 2015 Phone 719-233-9758 Phone: 407-683-2692 San Diego FOA Northern California FOA Del Mar Horse Races Christmas Party Del Mar Surfside Race Place (location to be announced) Del Mar, California December 4, 2015 August 28, 2015 Phone: 916-782-4144 Phone: 619-713-2411 National Coalition Affiliate Southern Nevada/Las Vegas FOA UFOLI Golf Tournament Member Meeting Holiday Party San Antonio Marriott Riverwalk Baiting Hollow Golf Club (location to be announced) San Antonio, Texas Baiting Hollow, New York December 4, 2015 October 27-28, 2015 September 10, 2015 Phone: 702-249-3301 Phone: 631-670-7602 San Diego FOA National Coalition Board Greater Seattle FOA Picnic Holiday Party of Directors Meeting With Tabletop Trade Show La Gran Terraza (University of San Diego) San Antonio Marriott Riverwalk (location to be announced) San Diego, California San Antonio, Texas September 12, 2015 December 5, 2015 October 29-30, 2015 Phone: 425-308-1216 Phone: 619-713-2411 continued on page 113 114 AVANTI MAY | JUNE 2015 MAY | JUNE 2015 AVANTI 115 116 AVANTI MAY | JUNE 2015