A Canadian company's $47 billion bid to acquire Seven & i Holdings, the Japanese parent company of the famous 7-Eleven chain, has sparked concerns about preserving the convenience store chain's distinctive food offerings that have made it a culinary destination in Japan, according to The Wall Street Journal.
The bid by Quebec-based Alimentation Couche-Tard would mark the largest-ever foreign acquisition of a Japanese company, according to The Wall Street Journal. While 7-Eleven operates globally, its 21,000 stores in Japan serve as the company's crown jewel, generating more than half of its operating profit in the first half of this fiscal year.
"My impression is you can't go wrong with Seven's quality," Chigusa Okazaki, a 51-year-old office worker told The Wall Street Journal. "If it's bought out, I have the feeling it might change for the worse."
The Japanese company's board rejected an initial offer from Couche-Tard in September, emphasizing "the crucial role that Seven & i plays in everyday life in Japan across food retail, banking, and other services."
Chief Executive Ryuichi Isaka has defended his team's position by highlighting their ability to expand globally while maintaining "the 7-Eleven brand's high-quality food."
The attention to detail in Japanese 7-Eleven stores is evident in their food preparation. In a factory outside Tokyo, workers prepare chicken and egg bowls individually, using eggs from hens fed specially to produce darker, richer yolks. This recipe, like many others, is exclusive to Japanese 7-Eleven stores.
The Canadian suitor, which operates Circle K stores in the US, has recently increased its offer price and pledged to respect the Japanese operation's excellence. "We have tremendous respect" for the "outstanding level of excellence" of the Japanese stores, Couche-Tard said in a statement to The Wall Street Journal.
Foreign companies have faced challenges in Japanese retail. Walmart largely withdrew from its Seiyu supermarket investment in 2020 after years of difficulties, while French retailer Carrefour departed Japan in 2005 after a brief four-year presence.
The Japanese convenience store model garnered international acclaim during the 2021 Tokyo Olympics when visitors discovered the high quality of its food offerings. Each typical 7-Eleven in Japan stocks hundreds of food items, accounting for roughly two-thirds of store revenue, according to company data.
The chain's dedication to quality extends to seemingly simple items. A rice master from Kyoto's Hashimoto family selects specific rice blends for the store's popular rice balls. The company even developed a custom potato peeler to remove the thinnest possible layer of skin for its potato salad.
Both current management and potential buyers aim to expand the Japanese chain's strategies to the US market, where some 7-Eleven locations now offer rice balls and Japanese-style sandwiches. However, regulations and logistics pose challenges, as US food safety rules require rice balls to be refrigerated, while in Japan they're kept at 68 degrees Fahrenheit to maintain optimal texture.
