Philseven allots P2 B for expansion

MANILA, Philippines - The local licensee of the 7-Eleven convenience store chain has set aside P2 billion this year to grow its branch network by a third nationwide.

Philippine Seven Corp. (Philseven) is taking advantage of its partnership with Chevron Philippines Inc. to fasttrack its expansion in the Visayas and Mindanao, in line with the goal of doubling its stores to 2,000 nationwide in the next three to four years, officials said.

“Our capital expenditures is P2 billion for this year,” said Philseven president and CEO Victor Paterno.

“By the end of this year, we plan to open 300 more stores, quite a few of them in the Visayas,” Paterno said.

Francis Medina, Philseven business development division manager, said there will be 25 new 7-Eleven stores in the Visayas this year including branches in Iloilo and Albay.

Last month, Philseven opened its 1,000th convenience store located at the IT Building of the Greenfield District in Mandaluyong City.

To fasttrack the expansion south of the Philippines, Philseven is taking advantage of its partnership with Chevron Philippines.

In 2009, Philseven and Chevron Philippines signed a deal for the establishment of 7-Eleven stores in a Chevron service stations nationwide.

“There are Caltex stations in Davao and Cagayan de Oro. We will tap them definitely,” Medina said.

In January, Philseven opened its 50th 7-Eleven store based in a Caltex station. The Caltex brand is marketed by US firm Chevron Texaco Corp., which partnered with 7-Eleven Inc. to pilot test a co-branding effort in 2003.

“We also have to make sure if Davao, for example, can accommodate 100 stores, same as Cebu,” Medina said, adding that there is already an acceptance of convenience stores in Davao given existing local operators.

For its nationwide operations, Philseven is introducing more services in 7-Eleven branches to increase foot traffic.

Paterno said 7-Eleven is exploring the setting up of kiosks where customers can book airline seats. Philseven will also offer remittance services.

7-Eleven, famous for its Slurpee, is also testing a grilled sandwich and frying program to increase its food products.

Philseven, which is banking on the robust retail market and franchising to maintain its position as the country’s largest convenience store chain, aims to hit 2,000 stores in the next three to four years. The company doubled its footprint from 500 stores in 2010 to 1,000 early this year.

In January to September, earnings of Philseven nearly doubled to P430.95 million from P224.42 million a year ago on the back of robust store sales. Revenues from merchandise sales, franchising and marketing efforts jumped 26.29 percent to P11.72 billion from P9.28 billion.