7-Eleven, the world’s largest convenience store chain, is in advanced talks with India’s Future Group to enter one of the fastest-growing retail markets.
If the plan goes ahead, the Kishore Biyani-owned retail company will open and operate small format 7-Eleven stores in India as a master franchisee, said two people aware of the development. A deal may be announced as early as March, they said. “While the stores will have products across categories, foods will have a greater focus,” one of the persons said.
Seven & i Group, which owns 7-Eleven among other retail formats, posted annual revenue of $100 billion through nearly 66,000 stores globally. The Japanese-owned, US-headquartered 7-Eleven generates nearly a third of its sales in the Asian country.
The Future Group’s latest move will be pitched against round the clock convenience store chain Twenty Four Seven, promoted by Modi Enterprises and In & Out, which is run by state-owned Bharat PetroleumNSE -4.96 % Corp Ltd. Seven & i Group and Future Group didn’t respond to queries.
“Future Group has a number of neighbourhood stores through their own format launches and through acquisitions. Some of them could surely be repurposed to 7-Eleven convenience stores, while there could be other franchisees appointed for specific sites or territories,” said Devangshu Dutta, chief executive at consultancy firm Third Eyesight.
“However, becoming a franchisee entails costs and restrictions. The question is whether there is enough margin available in the business to allow for so many tiers of stakeholders.” A partnership between the two will help Future Group reach out to buyers beyond their own outlets in the modern trade segment, analysts said.