Message from our FOA President, Mr. Jay Singh
During my five years tenure as a National Coalition Vice Chairman at one point I was given a task to deal with SEI’s Asset Protection Department as it was introducing new measures to put more attention about wrongdoing in franchised stores. Some of the new measures were installation of new security systems even though most of us had the systems installed with the approval of Seven-Eleven Inc. and SEI paid the total amount to vendors and charged the stores in installments. Then came Financial Impact work sheets as a mark up to franchisees, SEI’s new policy to get their lost share of Gross Profit Dollars on top of Audit Shortages and finally the big announcement by SEI’s decision about capability of watching franchisees store operation live via newly installed security system. All these policy changes and announcements led to a wide gap between Franchisee and Franchisor relationship. Failure of negotiations and constant gap of communication led to filing of few lawsuits by franchisees, one by National Coalition against live watching of store operations, other in New Jersey and in California also by local FOAs.
Times were tough, Franchisees and Franchisor relations soured to the peak but during all this turmoil Southern California FOA, its board and franchisees chose the way not to join the California law suit their decision led to a lot of turmoil for them, boycott by some FOAs, Solicitation to take away members, Unwanted maneuvers to influence last year’s local election but Southern California FOA did not change their decision, stood to their ground and opted the way of more improved negotiations to keep the channel of communication open with SEI. After a while California Law Suit was dropped, I am no body to comment on its merits and demerits, passage of time is the right element to decide the accuracy of that decision. On the other hand, open channel of communication, continuous engagement to focus on franchisee’s issues led to more involvement of SEI’s high level executive team to attend FOASC’s local Retailer Initiative meetings, Golf Tournament, Trade Show and to discuss current issues faced by all the franchisees country wide. All these high level meetings and ongoing discussions led to a strong relationship between both parties.
As one of the National Vice Chair up to 2014, President of Las Vegas FOA, former Long time resident of Los Angeles area up to 2001, I have tried my best to attend most of the General Meetings, Trade Shows and Golf Tournaments organized by Southern California, Greater LA and San Diego FOAs. Recently I attended General Meeting organized by Southern California FOA at beautiful Pacific Palms Resort in City of Industry on June 17, 2015. It was a very high level meeting attended by Joe Galea, National Coalition Chairman, Joe DePinto, Our CEO, Brad Jenkins, COO, Greg Franks, VP Franchise System, Dan Soper, Keith Jones, Wes Hargrove, Norman Hower, Local Market Managers, Franchisee Sales Manager and I apologize if I forgot to mention other attendees, all the High Level officials were there. SEI’s Team kept its promise to attend the meeting changed its flight to another Airport due to severe bad weather in Dallas area. Local response was so great that franchisees were occupying their seats in advance and eight more tables were added in that big hall to accommodate all the attendees.
Meeting started with introduction of all the guests including SEI Team, FOA Presidents, Local Board, followed by Zone Leader’s presentation about his Zone’s performance and then a detailed presentation by our CEO about company’s financial performance, challenges, unemployment rate, GDP growth rate, consumer confidence, median income, franchisee net income, areas of focus in the future. According to my notes, some of the contents of the presentation were:
Calories disclosures coming soon
Growth of Food & Beverages strategy
Quality of foods, Getting regional with Fresh Foods
Focus on Transaction Count; market basket is bigger on food, introduction of Melts, averaging 8 to 9 now.
Million more sandwiches were sold last year. Introduction of Ice Cream sandwiches
Addition to assortment of 101 new items in Private Brands as they are 19.1% up
Connecting digitally now, rise is going good as glitches have been fixed.
Seven Rewards, pay near me to pay utilities, rent, car payments,
Better support to Franchisees, Balanced Franchise system economics, $711 Million dollar for both parties, SEI earned $335 Millions, Franchisees made $376 millions.
$2.76 Billions were spent as Capital Investments; SEI needs to do more as a result more stores are getting Hot Foods
Maintenance Increases $10.2 Million, SEI took care of it, Gross income support $7.1 Million, Bill Backs $5 Million, CDC Volume short falls $1.7 Million. FZ income up $24793, Good wills sales are up.
After the CEO presentation, Q&A session began felicitated by local board members Javad Ursani and Paul Lobana, SEI Department Heads came to the main podium to answer all the questions related to different departments. CEO interfered and gave clarifications on some of the answers. Questions were asked from the audience too and some of them were;
Scan audits, SKU counts not right, “I” not populating right after the Audit.
Minimum Wage increase in some areas, Graduated Split, Maintenance, P1 performance is affected due to shortage of parts; Consistency should be there in Equipment in all stores, different urns, hot food some have it some don’t.
Tenure of the next agreement without Renewal Fee, Lottery Audits credits not passed on timely basis to stores and should be posted on 7-HUB.
To explore the Hispanic Assortment by local vendors
Meeting lasted for almost three hours, Q& A session was for Hour and half, varieties of questions were asked. Wonderful meeting run very professionally, great atmosphere, another big step by SEI to bridge the communication gap and improve franchisee relations. SEI team members stayed after the meeting for individual store issues and mingled with local franchisees. Big time credit goes to Sothern California FOA board members and local SEI team to chalk out minor details and put this meeting together.
I wish these kind of meetings should be organized all over the country, maybe small FOAs can organize joint meetings and share the expenses as this is a big time opportunity to address franchisee issues and our own agenda.
President Las Vegas FOA