Reflecting On 2024 And Preparing For 2025
Sukhi Sandhu, NCASEF Chairman
With 2024 now behind us, it’s safe to say last year felt like a rollercoaster ride for 7-Eleven franchisees. We’ve faced some big challenges, but also pulled off some impressive wins. Looking back, it’s clear that our resilience and unity got us through some tough times. Now as we gear up for 2025, I am confident we can tackle any issues that may come our way together as a team.
Last year wasn’t easy. Growing sales was a major challenge, and rising operational costs ate into our profits. Stores on the east coast experienced logistical problems with the Regional Distribution Centers (RDCs), which made it harder to get products and placed extra pressure on franchisees to find solutions on their own. But despite this, east coast franchisees rose to the occasion, keeping shelves stocked and customers happy through sheer determination and creativity.
The rollout of RIS 2.0 was a big step forward in terms of modernization, but it didn’t come without its hiccups. The transition caused disruptions, and both stores and customers felt the effects, like when network outages affected credit and debit card processing. Post-COVID, it seemed like some vendors and even corporate teams had gotten too comfortable relying on automated tools like guided replenishment and electronic ordering. These systems have their perks, but they’re not perfect—and when things go wrong, they can cause real headaches. Issues like outdated minimums and unchecked electronic orders created inefficiencies that franchisees had to fix, often on the fly.
Labor issues were another tough spot. Finding and keeping good workers has been harder than ever. The labor pool has changed, with many workers less willing to take on the demands of retail jobs. Turnover went up, training costs climbed, and all of it added to the stress of running a store. And let’s not forget retail theft—it hit record levels last year, adding yet another layer of frustration and driving up insurance costs for everyone as smash and grab claims skyrocketed.
The economic environment didn’t do us any favors, either. High interest rates made borrowing more expensive, impacting some franchisees who have to rely on SEI to help finance their inventory. Inflation pushed operational costs even higher and affected consumer spending habits. For many franchisees, this meant finding ways to cut costs and run stores as efficiently as possible while still delivering great customer experience and value. It wasn’t easy, but franchisees proved they could adapt and find creative solutions to keep things moving.
To make things tougher, the Franchisee Operating Credit program—the $200 monthly support many franchisees relied on—ended last year for those who signed the 2019 Agreement. The 7Now subsidy also ended, as did the auto GGPS of 100 and 150 basis points (but we worked out a solution for that, which I will explain below), placing additional financial pressure on franchisees.
But even with all these challenges, we had some big wins in 2024. Our collaboration with SEI improved in key areas. For example, we formed committees comprised of franchisee subject matter experts to tackle logistics issues and IT concerns with SEI. We also joined with SEI to introduce a franchisee-owned captive insurance program to help franchisees get the coverage they need while managing costs. Additionally, just as the auto GGPS reduction policy was set to end on December 31, your NCASEF and FOA leadership teamed with SEI to develop a new “earned” GGPS reduction model with the potential for the same or greater support as the previous program. These achievements show how much we can accomplish when all stakeholders work together and stay focused on common goals.
In California, franchisees took a proactive approach to tackling retail theft by joining forces with SEI, other business operators, lawmakers, and law enforcement agencies to push for legislative changes. Our efforts culminated in the passage of Prop 36 during the November elections, a measure aimed at strengthening penalties for repeat offenders and providing better support for theft prevention. 7-Eleven franchisees and FOAs from across the country also pitched in financially to help make this new law a reality, which is a significant step forward in addressing the growing issue of retail crime and could become a model for other states.
A huge highlight this year was hitting the $1 million mark in fundraising for Children’s Miracle Network Hospitals. Events like our convention’s Charity Golf Tournament and Charity Night Gala, as well as the golf tournaments held during our Board meetings and those organized by FOAs, were instrumental in our fundraising efforts. This milestone reflects our generosity, our commitment, and that we believe in giving back to our local communities, and it’s something we can all be proud of.
Our annual convention and trade show was another high point. Franchisees and vendors showed up in record numbers to network, exchange ideas, and find new sales opportunities. The energy and enthusiasm at this event were inspiring, reminding us why unity and collaboration are at the heart of what makes our brand strong.
Looking ahead to 2025, we know it won’t be a walk in the park. Inflation is still affecting consumer spending and we’ll still be dealing with rising audit inventory variances, insurance premiums, and labor costs. So, how do we tackle these challenges?
First, we’ve got to make store operations easier and less stressful for employees. Simplifying processes and reducing workloads will make 7-Eleven a more attractive place to work, helping us hold onto good employees and save on training costs.
Next, managing insurance premiums will take a group effort. Franchisees need to join our captive insurance program and learn how to keep the number of claims low. Education and training will be key here, helping everyone understand how claims are incurred and how to prevent them.
We also must get more involved in legislative affairs at the local, state and federal levels so we can influence bills affecting our businesses. This is essential, as retail theft continues to rise and as more municipalities across the country look to pass new measures that could negatively impact our operations and bottom lines.
We also need to address audit inventory variances, one of our biggest expenses. This means improving how we handle things like waste tracking, inventory control, and cycle counts. In addition, we need to manage the quality and dollar amount of our inventory more efficiently without running out of products. If we can tighten up these processes, we’ll see real savings and a healthier bottom line.
Food service will be a major focus next year. It’s a category with a lot of potential, but it also comes with challenges. Simplifying processes and improving inventory quality will help us make the most of this opportunity, as will keeping our stores clean and providing exceptional customer service. We also need to work with SEI to ensure we have a top-notch maintenance program so the equipment is always functioning properly.
Plus, we need to keep pushing to bring in new products and categories to stay competitive and keep customers excited. This includes working with our vendor partners to get better cost of goods. Another priority in 2025 will be to grow our private brand items without cannibalizing the national brand items that consumers look for in our stores and are loyal to.
We also need to keep pushing for better technology and infrastructure. Improvements to SEI’s IT systems could make a big difference in day-to-day operations, and investing in store remodels and new equipment will help us stay competitive. It’s up to us to advocate for these changes and show SEI how they can benefit everyone involved.
Finally—and I direct this not only to franchisees, but also to our SEI colleagues and our vendor partners—we are, all of us, overworked. Therefore, it is essential that we keep a close eye on our health and well-being so we can keep driving the brand and our businesses forward, and keep morale up for everyone.
I have several ideas I would like to see implemented this year through NCASEF that I believe would help us achieve some of our goals this year. These include hiring lobbyists to help introduce and influence bills that will benefit our businesses, hiring a PR firm to promote our successes and communicate our messages to trade publications and in social media, hiring asset protection consultants to show us how to prevent or minimize theft in our stores, and hiring insurance consultants who can educate us on how to minimize claims.
At the end of the day, our success in 2025 will come down to teamwork. By sticking together, sharing ideas, and supporting one another, we can tackle anything that comes our way. The principles of the “three-legged stool” are more relevant than ever: franchisees, SEI, and vendors all have a role to play in making the brand successful.
“Looking back, it’s clear that our resilience and unity got us through some tough times.”
“But even with all these challenges, we had some big wins in 2024.”
“These achievements show how much we can accomplish when all stakeholders work together and stay focused on common goals.”
“At the end of the day, our success in 2025 will come down to teamwork.”