The plight of 7-Eleven franchisees has reached National Public Radio (NPR). An NPR news story on the problems in franchising feature Chicago 7-Eleven franchisee Hashim Syed.
7-Eleven franchise owner Hashim Syed joined the bought the rights to operate his 7-11 convenience store Chicago’s North side in 1990 – nearly 25 years ago.
He says that 7-Eleven, Inc. gradually exerted more and more control over every aspect of franchisee’s operations to the point that they are now just “glorified managers,” rather than owners.
A NPR news report from radio station WBEZ in Chicago by Chip Mitchell and Shannon Heffernan (Bigger than burgers and fries, franchising blamed for low wages) features the not-uncommon plight of franchisee Hashim Syed:
In Syed’s nearly quarter century as a 7-Eleven franchisee, he has worked brutally long hours, his profits have fallen far short of his expectations, and the Dallas-based chain has imposed tighter rules on how he runs the store.
Something else that steams Syed is his role as an employer. He says all of those 7-Eleven rules limit his ability to cut costs and free up resources to treat his workers better. “When I lived in Bombay,” Syed said, “this is not what I thought they meant by the American Dream.”
Hashim Syed’s complaints against 7-Eleven are an all-too-familiar one at UnhappyFranchisee.Com, as we have posted numerous profiles of struggling franchisee (See 7-ELEVEN on UnhappyFranchisee.Com [UPDATED]).
In the news report, Syed laments that he could not afford to give an employees paid time off to care for his dying father, nor to pay his employees more.
He blames the 7-Eleven franchise restrictions for keeping him from making changes that would increase his profitability and pay for himself and his employees.
Last year, the 23rd in his store, Syed took home less than $54,000.
The news report on franchising states:
Syed says he bought his 7-Eleven franchise in 1990. “I was very excited,” he said. “I could buy everything from where I wanted to.”
After a while, however, Syed decided that being a franchisee was not all it was cracked up to be. It was not just the long hours. The company allowed another 7-Eleven to open just a few blocks away. Then it changed the terms of his franchise agreement.
Franchisees learned they had to buy 85 percent of supplies from approved vendors. “Now everything will be controlled by 7-Eleven Company,” Syed said. “They will decide what to buy, where to buy.”
Other franchisees complain that 7-Eleven goes as far as to remotely control the temperature in their stores, even the volume on their televisions.
Many of 7-Eleven’s rules do help protect the brand. And the company has reasons to make franchisees purchase supplies from an approved vendor. For one, 7-Eleven can use the collective buying power to keep costs down, a company official said.
Something 7-Eleven does not control are employment decisions, including the amount Syed pays his workers. Syed said one of his half-dozen employees, the manager, makes $10.50 an hour. He said the rest earn less — in a state where the minimum is $8.25.
Syed said he can hardly blame employees who are upset about the pay, but he insisted he is not getting rich either. Last year, his 23rd at the store, Syed took home $53,866, he said. That was one of his best years, he added.
To Syed, the whole franchise model feels like a setup. “We are as much of a victim in it as the workers are,” he said. “We are nothing more than a glorified manager.”
UnhappyFranchisee.Com was interviewed by NPR for the WBEZ story, and the story includes a link to this website.
7-ELEVEN on UnhappyFranchisee.Com [Index of posts]
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