In a surprising announcement, 7-Eleven is set to close almost 450 of its locations across North America due to underperformance. This news comes from a recent earnings report released by Seven & I Holdings, the Japan-based parent company of 7-Eleven.

The lackluster sales performance, particularly in cigarette sales, coupled with declining customer traffic and persistent inflation, has forced the company to take this drastic measure. Although a specific list of the stores that will be closing hasn’t been provided, the chain currently operates approximately 13,000 locations in the U.S. and Canada. This closure represents only about 3% of its total stores, but it speaks volumes about the shifting retail landscape.

For over six consecutive months, 7-Eleven has faced a decline in customer traffic, with August numbers reflecting a significant drop of 7.3%. Seven & I Holdings noted that while the overall North American economy appears stable, largely driven by high-income consumers, middle- and low-income earners are becoming increasingly cautious with their spending due to high inflation and interest rates.

Furthermore, cigarette sales, once the cornerstone of convenience store profits, have plummeted by 26% since 2019. The industry has seen a shift toward other nicotine products, but these sales have not compensated for the decline in traditional cigarette sales.

Responding to these challenges, 7-Eleven is planning to refocus its stores around food offerings, which have now emerged as the highest-selling category. The company aims to enhance its product lineup with popular international food items, including milk, bread, egg sandwiches, and even miso ramen in its U.S. locations.

This strategic pivot signals a broader trend within the convenience store industry, where retailers must adapt to changing consumer preferences and economic conditions. As 7-Eleven positions itself as a leader in retail innovation, it will be interesting to see how these changes impact the company's performance and whether they can rekindle customer interest in their stores.

Stay tuned for updates on which specific stores will be closing and how 7-Eleven's transformation will unfold in the coming months!