More than 400 7-Eleven stores in North America are closing, the company has announced.
The announcement was made in an earnings report issued last week by Seven & I Holdings, the Japan-based parent company of the chain, according to CNN.
No list of what the report called “underperforming” stores was released. There are more than 13,000 7-Eleven stores in Canada, Mexico and the United States.
The report said what it called a “more prudent approach to consumption” from middle- and low-income earners had hit stores due to inflation.
Collectively, these factors led to a 7.3 percent traffic decline in August, the sixth straight month of declines.
Although cigarette purchases were once a staple of convenience store sales, sales of cigarettes have dropped 26 percent since 2019.
7-Eleven said it will “open stores in areas where customers are looking for more convenience”
The closures were called a “gentle pruning of the chain to keep it efficient and profitable,” by Neil Saunders, a retail industry analyst and managing director with GlobalData Retail.
“The locations being closed have likely suffered from a disproportionate decline in foot traffic and customers as consumers battle with rising food prices and cut back on the amount they buy,” he said.
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“In some areas, increased competition from online and value stores will also have taken their toll as consumers seek out lower prices,” he said.
A “deteriorating” employment environment was also cited in the report.
That could become even more serious if Vice President Kamala Harris is elected president.
Harris has indicated that she wants an increase in the federal minimum wage of $7.25 per hour and has praised states that raised their minimum wage to $15 an hour, according to CNBC.
Harris has not called for a specific new minimum wage.
Convenience stores have had years of turnover rates topping 100 percent, with 36 percent of employees quitting after a month, HR Dive reported.
However, increasing wages only begins a ripple effect, as Scripps News reported in discussing California’s $20 minimum wage for fast food workers.
A survey from the Employment Policies Institute showed 98 percent of affected restaurants hit by the wage increase increased prices. Meanwhile, 89 percent reduced hours for their employees, 73 percent limited overtime or added shifts and 70 percent cut jobs.
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