An Analysis of 7-Eleven’s Strategic Business and Information Systems Needs.
An analysis of 7-Eleven’s Strategic Business and Information Systems Needs.
Q1. Evaluate 7-Eleven’s competitive advantage using the Michael Porter’s Five Forces model.
The 7-ELEVEN convenience store concept was created in 1927 by the Southland Corporation which, at that time, operated mainly as an ice, milk, and eggs retailer. By 1946, the Southland Corporation introduced a new convenience service that involved prolonging the opening time from 7 a.m. to 11 p.m. This was how the legendary 7-ELEVEN name came about. On April 28, 1999, The Southland Corporation officially changed their name to 7-ELEVEN INC. To date, 7-ELEVEN is present in over 20 countries and regions. Everyday, 200 million consumers of different race and lifestyles enjoy the 24-hour service at 7-ELEVEN. This significantly promoted 7-ELEVEN as a first-class business and brand worldwide.
Michael Porter’s Five Forces model are ease of entry, threat of substitutes, bargaining power of buyers, bargaining power of suppliers and industry rivalry. The competitive advantage that 7-Eleven has using these five forces is it has raised the barrier of entry for other competitors to enter the convenience store market as new competitors will require a huge capital investment in order to implement the RIS in their business in order to be competitive. Also, hypothetically being the first in the market, 7-Eleven could have made contracts with the government to not allow other 24-hour convenience stores in the market for a certain time period, such as Astro had done, thus having a monopoly market in the beginning of their operations which will allow them to snare a bigger market share.
Next, the threat of substitutes force shows that using the RIS 7-Eleven has upgraded their technology in order to provide better service, thus ensuring that their customers do not switch to their competitors such as KK-Mart or Hop-In.
The third force is the bargaining power of buyers where 7-Eleven’s customers are dependent
Q1. Evaluate 7-Eleven’s competitive advantage using the Michael Porter’s Five Forces model.
The 7-ELEVEN convenience store concept was created in 1927 by the Southland Corporation which, at that time, operated mainly as an ice, milk, and eggs retailer. By 1946, the Southland Corporation introduced a new convenience service that involved prolonging the opening time from 7 a.m. to 11 p.m. This was how the legendary 7-ELEVEN name came about. On April 28, 1999, The Southland Corporation officially changed their name to 7-ELEVEN INC. To date, 7-ELEVEN is present in over 20 countries and regions. Everyday, 200 million consumers of different race and lifestyles enjoy the 24-hour service at 7-ELEVEN. This significantly promoted 7-ELEVEN as a first-class business and brand worldwide.
Michael Porter’s Five Forces model are ease of entry, threat of substitutes, bargaining power of buyers, bargaining power of suppliers and industry rivalry. The competitive advantage that 7-Eleven has using these five forces is it has raised the barrier of entry for other competitors to enter the convenience store market as new competitors will require a huge capital investment in order to implement the RIS in their business in order to be competitive. Also, hypothetically being the first in the market, 7-Eleven could have made contracts with the government to not allow other 24-hour convenience stores in the market for a certain time period, such as Astro had done, thus having a monopoly market in the beginning of their operations which will allow them to snare a bigger market share.
Next, the threat of substitutes force shows that using the RIS 7-Eleven has upgraded their technology in order to provide better service, thus ensuring that their customers do not switch to their competitors such as KK-Mart or Hop-In.
The third force is the bargaining power of buyers where 7-Eleven’s customers are dependent
References: 1. (Porter, 1980) (http://www.maxi-pedia.com/Five+Forces+model+by+Michael+Porter) (accessed 11 November 2010) 2. (HP Case Studies, n.d.) (http://h10144.www1.hp.com/case-studies/7-eleven.htm) (accessed 11 November 2010) 3. (Tara Duggan, 2009) (http://www.ehow.com/about_5564925_retail-management-information-systems.html) (accessed 1 November 2010) 4. (Dayna Fried, HP, 2004.) (http://dssresources.com/news/246.php) (accessed 1 November 2010) 5. http://www.7-11.com.tw/en/aboutus/a10.htm (accessed 1 November 2010)