7-Eleven Plans to Close 444 Stores in U.S., Canada

The parent company of the 7-Eleven convenience store brand, Tokyo-based Seven & i Holdings Co., is planning to close 444 locations in the U.S. and Canada to cut underperforming assets in the region amid a change in its operational structure. The company did not disclose which stores will close, but the total represents roughly 3% of its North American portfolio.

Seven & i Holdings estimated a $30 million boost to its operating income this year and approximately $110 million in revenue from the sale of these stores. It attributed declining sales and traffic at its convenience stores to inflationary pressures and a decrease in cigarette sales.

“In North America, 7-Eleven is pursuing sustained business growth and enhanced capital efficiency in the context of a tough consumer spending environment, particularly among lower- and middle-income earners,” the company said in a prepared statement. “There is a growing polarization of consumption due to a decline in labor incomes, which is the result of challenging employment conditions, inflationary pressures, and high interest rates.”

Seven & i saw a decline in traffic exceeding 7% in August, as consumers became more cautious about spending due to inflation, high interest rates, and a worsening job market, according to a report by NPR. Cigarette sales, once a key product for convenience stores have dropped by 26% since 2019, as consumer preferences have shifted toward other nicotine products, the company said.

A portion of non-core assets, including subsidiaries in the superstore sector, will be spun off into a new holding company called York Holdings, according to presentation materials shared during the company’s quarterly investor call last week.

The parent company plans to rebrand as 7-Eleven Corporation and is currently marketing a $750 million sale-leaseback deal expected to close by the end of the year, resulting in a one-time gain of $520 million. Its international subsidiary also aims to open 50,000 stores outside North America and Japan by the end of fiscal 2025.

News of 7-Eleven’s performance comes as consumer confidence continues to decline, according to the University of Michigan’s consumer sentiment index. The university reported that consumers remain frustrated with high prices as personal finances weaken.