SAN ANTONIO – A recent survey of 7-Eleven franchise owners in the United States conducted on behalf of the National Coalition of 7-Eleven Franchise Associations (NCASEF) found that operators face chronic understaffing despite an increase in wages beyond what is mandated by the state or local minimums.
The 17-question survey of 422 participants found that 97% of franchise owners struggled to staff their store (s) in the past year and 96% said they or their representative had worked more shifts than they usually work in the past 60 to 90 years. days.
Almost 50 percent said they or a designated person had worked at least 10 night shifts in the past 60 days because they were under-staffed.
“This survey proves what our franchise members have long told us. They can’t find enough people to work and they themselves work too many hours,” said Jay Singh, president of NCASEF, an elected and independent body representing the interests of more than 7,400 7-Eleven franchised stores in the United States.
“What is most telling is that only 13% of franchisees who responded said that overnight operations were financially profitable for them as franchise owners. This is because the economic environment in which we are in has changed, but the royalty structure for 7-Eleven franchisees has not changed, ”Singh said.
Franchisees who said overnight operations were not profitable were asked about the impact of these four factors on profitability:
- Increase in labor cost (27.25%)
- Lack of available, qualified and reliable labor (11.05%)
- Lack of customer traffic during night hours (10.54%)
- Decrease in the number of customers due to new competing stores near your store (s) (0.26%)
- All of the above (50%)
Other survey results show:
- Only 20% of those surveyed said they were able to offer their employees a competitive salary based on their current contractual allocation of their gross profit with 7-Eleven Inc. The company’s franchise agreement requires that franchisees pay a progressive distribution of their gross profit in exchange for their right to operate. . For some franchisees, the share of gross profit sharing, or royalty, may be greater than 59%.
- Ninety-two percent of those surveyed said they had increased their hourly rate of pay in the past year and 89 percent said they had increased their hourly rate of pay beyond what is mandated by their minimum wage national or local. However, 97% said they had difficulty staffing their store during this same period.
- Ninety-six percent said it had become more difficult to staff their store in the past 60 to 90 days. Ninety percent of respondents said they lowered their standards for new hires due to the state of the job market.
The National Coalition survey also asked franchisees if they are currently taking advantage of the recruiting tools that 7-Eleven has made available to franchise owners. Ninety percent of those surveyed said they “use recruiting tools such as Hire Right, provided by 7-Eleven.”
“These tools are useful, but franchisees are still under pressure to raise wages in order to find and retain high caliber workers. Unfortunately, many franchisees cannot afford to compete with other employers,” said Singh.
The survey was carried out in June. Full survey results are available here.
The San Antonio-based NCASEF is a trade association for 7-Eleven franchise operators in the United States. Originally founded in 1973, NCASEF is made up of 41 separate independent franchise owner associations with 4,400 members.