Why Are Vendor Promotions Accepted?
The vendor community has a very tight relationship with franchisee leadership, and many times will talk about their frustrations with our franchisor and even ask for our help with SEI. Our vendor partners are charged by their bosses to achieve sales goals and execute promotions with assigned retailers. Only the largest suppliers have a sales representative dedicated to 7-Eleven; most work not only with other convenience store groups, but also other channels. Many times, senior management develops the promotional schedule and pricing, and the sales rep is expected to sell the program to all of their customers.
Obviously, because of the size and familiarity of the 7-Eleven brand, we are many times the first chain considered for these manufacturer promotions and deals. Having been in business for 87 years, and having seen such a large share of the promotional activity coming from manufacturers, SEI has certain expectations before engaging in any promotional activity to its stores. We as franchisee leaders continue to hear from our representatives in the supplier community about how they need more communication from corporate, because most often they are left to guess how their initiative must mesh with SEI’s objectives.
There are several types of promotions that usually land in our stores. There are the “Buy One, Get One” deals, free fills, “2 for $” promos, new product samplings, “First, Best and Only,” and many others. Sometimes the promotion is simply a tagline in an ad or a commercial that the product is available at the local 7-Eleven, and other times it may be free product available at 7-Eleven to our customers. There’s no questioning the value these promotions have on franchisee bottom lines, because they help attract customers to our stores.
SEI has made it broadly known that promotions must be fully funded to make both corporate and the franchisee whole in the gross profit dollars earned in a promotion. Too often, however, vendors express frustration when category managers turn down promotions with little or no explanation about how a promotion could be changed to be palatable to franchised stores.
Worse yet, we hear often from manufacturers that SEI will not acknowledge they have even considered a manufacturer’s promotion. In exasperation, the vendor then offers the promotion to a competitor and we are selling against it in stores around town. It is difficult for franchisees to understand why SEI will not even consider approving a 7-Eleven tag to an advertised product that is already recommended in our stores. Adding insult to injury is the vendor’s inability to get answers after repeated phone calls and emails that simply ask for a response from the category manager so the representative from our vendor partner can fulfill their responsibility to their company.
So here are my questions: What is the rationale for accepting some vendor promotions and not others, and how can we as franchisees help our vendor partners in this situation? It is especially difficult for the vendor to ask for help from the franchise community to spur a response from SEI.