I watched a documentary of Seven Eleven Japan on TV the other day. It was very interesting how they grew their business to not only become the top convenience store, but also the top retailer.
The story goes like this: 2 employees from Yokado went to the US to purchase the brandname license for Seven Eleven, and over 100 folders of manuals. Since 7-11 US didn't plan to enter the Japanese market at all, they instead suggested a very expensive royalty. Although they staked their fate on this deal, Yokado, their employer, wasn't happy about it at all and became negative about the whole project. So, in the end the company decided to finance only 50% of the capital for the 7-11 Japan project. Those 2 employees left Yokado, dumped their savings into the new business, took out mortgages on their houses, and approached the banks to loan money. For two years, they worked more than 16 hours a day.
They started the business with the whole world against them. The concept of "convenience store" was very new in 70's, and there were a lot of resellers at that time. The two ventures looked very hard on how to cut into the market. One of their disadvantages is that they were all amateurs, but it turned out to be a blessing in discuss; although they were not experts for
logistics, wholesale, and retail, they were however flexible enough to change the old systems. Of course the wholesalers were not co-operative to those amateurs.
They checked inventory everyday by hand since they didn't have POS at that time; negotiated with the wholesaler to stock sufficient goods, not the minimum order of dozen; etc. What 7-11 has now, looks very simple to me, but no one ever tried to change this system before them. By this very painstaking process, they made their own manual, and which will 7-11 US in future to
restructure their business.
These 2 ex-employees are now Chairman and the President of the 7-11 Japan and they still run their business.
With passion, faith and the hard work, they achieved their today's status, and it's even taken as a reference to the Harvard University MBA class as a successful business next to the Kanban from Toyota. There are a lot of things we can learn from the pioneers but basic denominator looks that they can tell what is the common sense and what is not, and how to implement it to their business with enthusiasm. Does it give you a tip to your business?
The story goes like this: 2 employees from Yokado went to the US to purchase the brandname license for Seven Eleven, and over 100 folders of manuals. Since 7-11 US didn't plan to enter the Japanese market at all, they instead suggested a very expensive royalty. Although they staked their fate on this deal, Yokado, their employer, wasn't happy about it at all and became negative about the whole project. So, in the end the company decided to finance only 50% of the capital for the 7-11 Japan project. Those 2 employees left Yokado, dumped their savings into the new business, took out mortgages on their houses, and approached the banks to loan money. For two years, they worked more than 16 hours a day.
They started the business with the whole world against them. The concept of "convenience store" was very new in 70's, and there were a lot of resellers at that time. The two ventures looked very hard on how to cut into the market. One of their disadvantages is that they were all amateurs, but it turned out to be a blessing in discuss; although they were not experts for
logistics, wholesale, and retail, they were however flexible enough to change the old systems. Of course the wholesalers were not co-operative to those amateurs.
They checked inventory everyday by hand since they didn't have POS at that time; negotiated with the wholesaler to stock sufficient goods, not the minimum order of dozen; etc. What 7-11 has now, looks very simple to me, but no one ever tried to change this system before them. By this very painstaking process, they made their own manual, and which will 7-11 US in future to
restructure their business.
These 2 ex-employees are now Chairman and the President of the 7-11 Japan and they still run their business.
With passion, faith and the hard work, they achieved their today's status, and it's even taken as a reference to the Harvard University MBA class as a successful business next to the Kanban from Toyota. There are a lot of things we can learn from the pioneers but basic denominator looks that they can tell what is the common sense and what is not, and how to implement it to their business with enthusiasm. Does it give you a tip to your business?
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