Future Retail Company cancels 7-Eleven franchise agreement in India
Future Retail Company revealed on Tuesday (October 4) that it has terminated its franchise agreement with US convenience store chain 7-Eleven. The company said the canceled contract was for the operation of the said convenience store brand in India.
The leading retailer that operates multiple retail formats in the Indian consumer market said the termination was due to 7-Eleven failing to meet targets for opening outlets and paying fees for franchise.
According to Reuters, the decision to end the deal was mutual between the companies. They first signed a contract in 2019, and at that point it was announced that Future Retail Company would operate 7-Eleven’s first store in India.
However, local media across the country have reported that due to the COVID-19 pandemic, the franchise agreement has never been implemented to date. And as stated, the latest development only led to the termination of the contract due to financial issues and other things.
Based on the initial plan, Future Retail Company will build and open new 7-Eleven outlets in the country and convert some of its existing stores to feature the US convenience store brand. In any case, in a statement to the stock exchanges, the company said that the cancellation would have no effect on the business of the Indian company – financially or in other forms.
“In accordance with Regulation 30 and other applicable provisions of the SEBI Registration Regulation, we wish to refer to the main franchise agreement dated February 28, 2019 signed between Future7-India Convenience Limited, a 100% subsidiary of the company ( Future-7) and 7-Eleven INC ”, is part of the regulatory dossier for Future Retail, as published on Live Mint.
It was added: “Also executed by the Company and Future Corporate Resources Private Limited as a confirming party and controlling principal for the development and operation of 7-Eleven stores in India is now terminated in accordance with the performance of the mutual termination agreement signed between the company, Future- 7, 7-Eleven, INC and FCRPL on October 05, 2021.
Meanwhile, Indian group The Future already has a range of branded stores under the Nilgiris label, and the only difference with 7-Eleven is that it offers 24/7 service. It also has It was noted that US-based convenience stores not only offer groceries, but there are additional services that customers can easily access as well.