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Officially, it's called the "180-Day Termination andRefund Program," but The Southland Corp., franchisor of7-Eleven convenience stores, likes to call it a "testdrive." Since 1981, franchisees in every state but Ohio havebeen able to take the helm of a fully equipped store with theoption of terminating the franchise agreement any time during thefirst 180 days--all that's required is 10 days advance notice.The franchisee then receives a refund of his or her currentinvestment and fees, less any training expenses incurred bySouthland.
It may sound like a temptingly easy way out, but the successrate of the program is a testament to its effectiveness. Of the 300to 400 7-Eleven stores franchised each year, less than 5 percenttake the termination option. The program is good for both thefranchisor and franchisee, according to Margaret Chabris ofSouthland. "The purpose is to take some of the risk out of thefranchise process," she explains. "And it helps thecompany ensure that people who decide to franchise a 7-Eleven storewant to stay for the long term."
Chabris also believes 7-Eleven is uniquely suited to this kindof arrangement because Southland controls the land, building andequipment. "If a franchisee chooses to take the refund,"says Chabris, "the company can take back the property,building and equipment, and re-franchise that location."Offering an offramp for franchisees may be the best thing since,well, Slurpees.
Contact Source
7-Eleven Inc., (800) 255-0711, http://www.7-eleven.com
