Why Lawson and Family Mart No Longer Operate in the U.S., While 7-Eleven Thrives

Lawson, Family Mart, and 7-Eleven’s Global Journey

Lawson is a convenience store chain that originated in the United States. It was founded by James “J.J.” Lawson in Cuyahoga Falls, Ohio, in 1939. Initially, it was a dairy store that expanded to sell various grocery items. However, Lawson became more popular in Japan, where it was introduced in 1975. Today, Lawson is primarily known as a Japanese convenience store brand, with thousands of locations across Japan and other parts of Asia. The U.S. operations no longer exist, but the brand remains highly successful in Japan.

Source: insideretail.asia

Lawson’s operations in the U.S. ceased primarily due to changes in ownership and market conditions. Here’s a breakdown of the key reasons:

1. Acquisition by Dairy Mart: In 1985, the Lawson chain in the U.S. was sold to Dairy Mart, a convenience store chain that rebranded or closed many of the Lawson stores. This transition contributed to the decline of the Lawson brand in the U.S.
2. Competition in the U.S. market: The U.S. convenience store market was, and still is, highly competitive, with established players like 7-Eleven, Circle K, and others dominating. Lawson faced challenges in maintaining market share against these giants.
3. Focus on Japan: While Lawson faced difficulties in the U.S., the brand found significant success in Japan after opening its first store there in 1975. The company shifted its focus to the Japanese market, where it rapidly expanded and became one of the top convenience store chains.
4. Different consumer preferences: Lawson’s product offerings and store formats were more suited to Japanese consumers’ needs, where convenience stores (known as “konbini”) are an integral part of daily life, offering a wide variety of goods and services.

Due to these factors, Lawson’s presence in the U.S. diminished, while it flourished and expanded internationally, particularly in Asia.

FamilyMart, like Lawson, is another major convenience store chain that has its origins in Japan. Here’s a brief overview of FamilyMart’s history and operations:

Origins of FamilyMart

• Founded in Japan: FamilyMart was established in Japan in 1973 by the Seiyu Group (a subsidiary of Walmart). It opened its first store in Sayama, Saitama Prefecture, in 1973, and by the late 1970s, it had already started expanding across Japan.
• International Expansion: While FamilyMart originated in Japan, it has expanded globally, especially in Asia, where it operates in countries like Taiwan, South Korea, China, Thailand, the Philippines, and Vietnam, among others.

Source: kawaii-sweet.com

FamilyMart in the U.S.

• Entry into the U.S. Market: FamilyMart attempted to enter the U.S. market much later, in 2005, through its “Famima!!” brand, with stores initially targeting urban, upscale areas in Los Angeles.
• Challenges and Closure: Despite its success in Japan and other Asian markets, FamilyMart faced similar challenges to Lawson in the U.S., including intense competition from established convenience store chains like 7-Eleven and a consumer market with different preferences. By 2015, all of its U.S. stores had been closed due to poor performance.

Why FamilyMart’s U.S. Operations Failed

1. Competition: The U.S. convenience store market is dominated by big players like 7-Eleven, and FamilyMart struggled to differentiate itself in such a competitive landscape.
2. Consumer Preferences: The product mix offered by Famima!! stores was designed to cater to Japanese tastes, which didn’t resonate as well with American consumers who were accustomed to different food and shopping habits.
3. Brand Awareness: FamilyMart didn’t have the same level of brand recognition in the U.S. as it did in Japan and other Asian countries, making it difficult to attract a loyal customer base.

Success in Japan and Asia

• Strong in Japan: In Japan, FamilyMart is one of the “Big Three” convenience store chains, along with 7-Eleven and Lawson. It offers a wide range of products, including ready-to-eat meals, beverages, daily essentials, and even services like bill payments, ATM access, and package delivery.
• Taiwan as a Major Market: Outside of Japan, FamilyMart has also found significant success in Taiwan, where it is the second-largest convenience store chain. Its expansion in other Asian countries has also been largely successful, with localized products and services tailored to each region.

Like Lawson, FamilyMart exited the U.S. market due to competition and differences in consumer behavior, but it remains a dominant force in the convenience store industry across Asia.

7-Eleven is the largest and most iconic convenience store chain in the world, and it has an interesting history that spans both the U.S. and international markets, particularly Japan.

Origins of 7-Eleven

• Founded in the U.S.: 7-Eleven started as Tote’m Stores in Dallas, Texas, in 1927. It was initially a small ice company that sold ice blocks for home refrigeration, but it quickly expanded into selling groceries and other essentials. The company was rebranded as 7-Eleven in 1946 to reflect its extended operating hours, from 7:00 a.m. to 11:00 p.m., which was quite innovative at the time.
• Pioneering 24/7 Operation: In the 1960s, 7-Eleven began operating 24 hours a day, a concept that has since become one of its defining features.

Source: livejapan.com

Global Expansion and Success

• Entry into Japan: 7-Eleven’s most significant international success story is its expansion into Japan. In 1974, the Japanese company Ito-Yokado (later part of the Seven & I Holdings Group) opened its first 7-Eleven in Tokyo. The Japanese subsidiary grew rapidly, and today, Japan has more 7-Eleven stores than any other country in the world.
• Acquisition by Seven & I Holdings: In 1991, the Japanese operator of 7-Eleven stores, Seven & I Holdings, acquired a controlling interest in Southland Corporation, the parent company of 7-Eleven in the U.S. As a result, 7-Eleven became a Japanese-owned company, though it still operates globally under the same brand.
• International Presence: 7-Eleven has become a global brand with over 83,000 stores across 19 countries, including the U.S., Japan, South Korea, Thailand, Taiwan, and several other nations. Its expansion has made it the most widely recognized convenience store chain in the world.

7-Eleven in the U.S.

• Dominance in the U.S.: Despite being owned by a Japanese company, 7-Eleven is still a major player in the U.S. convenience store market. It has maintained a strong presence due to its pioneering role in offering 24/7 service, selling a variety of goods, and introducing innovations like Slurpees and Big Gulps, which became synonymous with the brand.
• Adaptation to Consumer Trends: Over the years, 7-Eleven has adapted to changing consumer preferences by offering healthier food options, ready-to-eat meals, coffee, and delivery services through partnerships with apps like DoorDash and Postmates.

Why 7-Eleven Succeeded Where Others Did Not

1. Innovative Business Model: 7-Eleven pioneered the 24/7 convenience store model, which revolutionized how consumers shopped. Its ability to stay open during all hours made it a go-to for quick and late-night purchases.
2. Global Flexibility: Unlike some other convenience store chains, 7-Eleven has been very successful in localizing its offerings. For example, in Japan, 7-Eleven sells an extensive variety of ready-to-eat meals, Japanese snacks, and even offers services like bill payment and package delivery. This ability to adapt to different markets’ needs has been a key to its international success.
3. Japanese Management and Expansion: After the acquisition by Seven & I Holdings, 7-Eleven’s global operations were managed with a Japanese focus on efficiency, customer service, and product variety. Japan’s convenience store culture, which emphasizes high-quality food, convenience, and services, helped 7-Eleven grow both in Japan and globally.
4. Strong Brand Recognition: 7-Eleven has become a household name, recognized for its wide range of products, iconic items like the Slurpee, and consistent availability across the globe.
5. Technology and Delivery Services: In recent years, 7-Eleven has embraced new technology and expanded into delivery services, making it a convenient choice in the age of online shopping and app-based services.

Challenges in Some Markets

While 7-Eleven is globally successful, it has faced challenges in some regions. In parts of Europe, 7-Eleven has struggled to maintain a strong presence due to competition with local chains and different consumer shopping habits. However, its adaptability in other markets has helped it remain a dominant global brand.

In Summary

7-Eleven’s success lies in its innovative business model, adaptability to local markets, and ability to maintain a strong brand presence globally. Unlike Lawson or FamilyMart, which struggled in the U.S., 7-Eleven has managed to thrive both in its home country and abroad, particularly in Japan, where it is the leading convenience store chain. Its focus on convenience, wide product offerings, and ability to meet the needs of consumers 24/7 have made it a global powerhouse in the convenience store industry.