NEW YORK – 7-Eleven Inc. is adding more space for lockers at a number of its North American stores, reports the Wall Street Journal.
Over the past year, 7-Eleven has added lockers for customers to pick up FedEx and UPS packages, as well as Walmart lockers at six Toronto stores. The growth of locker units is “a significant expansion in scope of a program first piloted with Amazon.com Inc. in 2011,” writes the news source.
Although e-commerce is a booming business, convenience retailers are not yet overwhelmed within that competitive space, given the nature of the c-store model: speed of service, immediate consumption, impulse purchases and fuel. However, notes the news source, 7-Eleven executives say they had to find a way to evolve and remain relevant as more consumers turn to online shopping for household staples, groceries, health and beauty care and other products found in convenience stores. The lockers are also part of a larger strategy to maintain customer traffic as e-commerce continues to grow.
But it is a risky move for 7-Eleven, a subsidiary of Tokyo-based Seven & i Holdings Co. Each locker unit takes up about the same amount of space as one large shelf, holding dozens of lockers, which by some estimates could represent thousands of dollars in lost sales each year.
By staying nonexclusive to which lockers (i.e. retail, postal/packaging, etc.) are offered in 7-Eleven stores, the company says it can eventually turn a good profit from the lockers. “We want to be the Switzerland of multi-channel commerce,” Raja Doddala, vice president of new ventures and omni-channel at 7-Eleven, told the news source.
Other retailers have experimented with similar pickup services, with mixed results. For example, Walgreens and Rite Aid Corp. currently host lockers, but Staples and RadioShack removed units in 2013 as competition with Amazon heated up. A differentiator that could lead to locker service success in convenience stores, meanwhile, is that most are open 24/7.
“7-Eleven is by far the most obvious choice for these lockers,” Graham Hotchkiss, analyst at RetailNet Group, told the news source. “How consumers use these lockers is still something that’s very up in the air.”