7-Eleven promised "Everything essential". It still lost to India's corner shops

Rachel Varghese (0:00)

Mele Har Cheez Zaroori. That's Hindi for, You can find everything essential. And what the science inside India's 7-Elevens claimed. Other science made similar promises. Rose ke liye, snacking ke liye, Choti Bhuk ke liye. Basically, everyday items, snacks and quick bites for when you're just a little bit hungry. That was the pitch when the first 7-Eleven store opened in Mumbai on October 9th, 2021 It was also the model that had made the chain popular in places like Japan, Thailand and the USA, localized for India. The hot food counter, in fact, was affordable as well, with a cup of chai starting at just 10 rupees.

So, it made sense why there was genuine excitement when the first 7-Eleven stores started opening. After all, it was the world's biggest convenience chain. Owned by Seven and I, a Japanese company, as of August 2024, it had roughly 85,000 stores across 20 countries and territories. And its India partner, Reliance Retail. The biggest retail operator in the country, operating more than 20,000 stores across India. Joe De Pinto, the CEO and president of 7-Eleven at the time, said that 2021 was an ideal time for the company to make its entry.

Cut to 5 years later, and 7 and I said last week that Reliance had closed the final 31 7-Eleven stores in Mumbai and Pune on September 30th. Until the end of last year, there were actually 60 stores across India. So, it's likely that the remainder were closed over the course of this year, before the chain even finished 5 years in the country.

So, what happened? Honestly, neither 7&I or Reliance have offered a clear answer for the closures yet. Some reports claim it was local competition, Kirana stores and Quickcommerce. Another said that it was more of a reset for 7&I than an exit strategy. But 7-Eleven has thrived for years in countries where corner shops and street stores are popular. So, why couldn't the world's biggest chain backed by India's biggest retailer make it work in India?

Welcome to Daybreak, a business podcast from The Ken. I'm your host Rachel Varghese and every day of the week, my co-host Snigdha Sharma and I will bring you one new story that is worth understanding and worth your time. Today is Wednesday, the 14th of October.

I think many of us who know about 7-Eleven from Western media recognize the iconic slope peas. They are icy, sugary, carbonated drinks that 7-Eleven exclusively sells in the US. They even give them away for free on July 11th, because the date is 7-Eleven, and the company estimates that it has given away millions of them over the last 60 years. So when 7-Eleven came to India, Reddit had one question. Would they have slope peas?

In fact, one user even said, if they don't have slope peas, it's not a real 7-Eleven. We riot. But as soon as people actually started visiting the store, the answer started disappointing everyone else. One shopper went to the store, hoping for a slope pea and found masala lemonade. Another said that their nearby stores were lacking in the essentials all the signage claimed to have. No rice, eggs, milk or even maggi. Just coolers filled with drinks and frozen food, and aisles filled with snacks and imported ramen packets. So what would a shopper even walk in for? Experts told CNBC that this is something that small stores in India struggle with in general.

So one thing an Indian would walk in to a 7-Eleven for is warm food. The counter in most stores sold samosas, small pizzas, sandwiches, biryani and more. Everything was quite pocket-friendly as well, with most items being under 170 rupees, with a samosa costing as little as 15 rupees.

But it was not significantly cheaper or better than street food. And while people seemed to like it, there weren't exactly rave reviews. It wasn't something that people would walk into the store for. Which brings us to two. Reliance claimed that their stores were hygienic. And they offered an air-conditioned spot for people to sit and eat in. In fact, a sign in one store called it AC Wali Khau Gali, an air-conditioned street food alley. But that claim lost standing as well last year, when a video of a rat eating ice-cream in a Mumbai 7-Eleven went viral on Reddit. You see, 7-Eleven actually had an advantage coming to India much later than the other markets. Several people recognized the name and brand from media, and several were curious about what they had to offer. Where they messed up was, ironically, localizing too hard. They were not really offering the stuff that people were actually excited to try. Like the Slurpees, for example, or the ramen making stations in some Asian countries. Where you can basically buy a cup of ramen, add water and toppings like cheese or egg or seaweed, right inside the store.