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7-Eleven Food Stores

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Our Beginning...1927The Convenience Concept

Give the customers what they want, when and where they want it.

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Global Brand Strength

...the Largest Convenience Chain in the World

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Do you have what it takes?7-Eleven Franchisee Attributes

Hiring and supervision experience Capable of building infrastructure and developing

an English speaking sales team in addition to the language of the local community

Ability to implement company programs & strategies to maximize sales and profits

Ability to adapt to market and company changes Strong financial savings, portfolio, credit rating for

the investment Desire to work with people and support the local

community Desire to work within a controlled franchise

system Embrace the 7-Eleven fresh food model

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Fresh Food“Portable Fresh Food”

7-Eleven Business Model / Retailer Initiative

Customer Satisfaction“The Customer”

Technology “The Core”

Retailer Initiative“Item-by-Item”

Demand Chain“Daily Delivery”

Services“Financial Convenience”

Team Merchandising“Product Innovation”

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Your Investment

One time Franchise fee One time Gasoline fee (if applicable) Down payment on initial inventory and supplies Initial cash register fund State and local licenses, permits and bonds Goodwill (if applicable)

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The Financial Picture

Your Share of Gross Profit

Net Merchandise Sales

Cost of Goods

Total Gross Profit=

7-Eleven’s Share of Gross Profit

- Less expenses

= Your Net Income

- Less expenses

= 7-Eleven Net Income

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Your Responsibilities

Payroll, Payroll Taxes Workers Compensation Insurance Business & Inventory Taxes Cash & Inventory Shortage Your share of Credit Card Fees National Advertising Fee Business Licenses & Bonds Interest Expense Telephone Janitorial & Laundry General Maintenance & Upkeep of Store Equipment Common Area Maintenance Store Supplies

Share of Gross Profit – Expenses = Your Net Income

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7-Eleven’s Responsibilities

Land, Building, Equipment, Rent & Property Taxes

Utilities (water, gas, electric, sewer) Record Keeping Quarterly Audits Individual Contractual Indemnification Building Maintenance & Repairs Business Consulting POP/Advertising Materials Market Research & Product Selection

Price & Vendor Recommendations Ongoing Store Support Services

Share of Gross Profit – Expenses = 7-Eleven’s Net Income

The 7-Eleven Franchise System

• 7-Eleven offers two types of Franchise systems: Traditional and Business Conversion Program (BCP)

– Under the Traditional Franchise Program, 7-Eleven incurs initial and ongoing costs of the land, building and equipment and leases a turnkey business to the Franchisee

– The Business Conversion Program allows property owners to maintain control of their real estate while taking advantage of the 7-Eleven Business System

• The BCP Franchise program is designed to accommodate stores with or without gas

–The program focuses on optimizing merchandise gross profit; 7-Eleven does not share in your gas business

Business Conversion Overview

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What is BCP? Is a means of new store development Provides opportunity for independent

convenience store operator to convert their operation to a 7-Eleven franchise

Both parties invest in remodeling & updating store to 7-Eleven image

Allows independent to obtain all the benefits of 7-Eleven (Brand, Services, Merchandising, ETC.)

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Qualification the same as traditional but must also:– Qualify as a business owner– Have a site that qualifies for a 7-Eleven– Current 7-Eleven Franchisees must qualify via

the Multiple Store Guidelines with various levels of Management approval

Qualifications

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Site Standards Store size conforms w/ability to deliver

business system – At least 1800 square foot selling space – less

must qualify under an exception process– Business system = daily delivery of fresh

food, night time deliveries– Must be a 24 hour x 7 day operation

Conflicts will be evaluated on case by case basis

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Franchise Fee and Deposit • Due at agreement signing $25,000 initial Franchise Fee Deposit of $25,000- $40,000 depending on type of conversion. (existing c-store with inventory, non-existing c-store, major development)

$35,000 minimum net worth maintained at all times

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7-Eleven Charge Gross profit based royalty

– No charge for the first 3 months– Thereafter, 25%

Add 2% for certain business arrangements– Alcoholic beverages in Maryland

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Benefits of Franchising a 7-Eleven

Name Recognition Established Business System A Leader in Support & Training Daily Distribution of Fresh Foods Leader in Technology Innovation Continual Operational Support Over 80 Years of Business Experience