Overview of 7-Eleven Stores Pty Ltd
7-Eleven Stores Pty Ltd is one of the famous multinational companies in Australia. It is operated as proprietary company, which generates a vase amount of food relating Industry in Australia. This company has a great amount of income sources from the food industry, which is operated only in Australia. The company runs their organization with 1000 employees and other that this number, it has other employees who are subsidiaries under the control of this company. There are almost 45000 employees are connected with this organization globally. The convenience stores of the company is operated by the American-Japanese international, which headquarter, is in Texas (Webster 2017).
The company has a great number of franchises and licensed program, which helps to operate approximately 56,600 stores in 18 countries. All of the stores chain is known as ‘Tote’m Stores’ which was renamed in the year of 1946. In Texas, they have their roots, which operated the whole business organization. It has moved their roots to Canada in 1969 and Mexico in 1971. The retail chains of the organization has expanded in the year of 1974 which helps to control and runs the business in Japan as 7-Eleven Japan and became the headquarter in November 2005. In the present days, they have a long chain of retail business all over in Thailand, Australia, Sweden, Malaysia, Indonesia, Philippines Macau, UAE, Denmark, Taiwan, Norway, Hong Kong and Singapore (Buchan et al. 2017).
In Australia, the first store was opened in August 1977 and now in all over the country they have opened more 630 stores in New South Wales, Australian Capital Territory, Queensland, Victoria and Western Australia. The company has a huge service ranges, which include slurpee beverages, 7-eleven fuel, stationary, & gifts, treats, refreshments, news, magazines, Personal Care & Cleaning, Auto & Car care, Australia Post Parcel lockers and Citilink payments facilities.
The aim of the company has to achieve their goal and objectives, which make it, ensure that the customers get access to find their favorite food and beverages and other items, which are part of the convenience. Those are all stored for fresh food and beverages that are useful for their personal care products (Webster 2017). All kinds of the manufactured products are available in the stores. The company has set their motto which helps to describe their dedication towards the global business marketing which is ‘Give the customers, what they want, when and where they want it’. The 7-Eleven Stores Pty Ltd has spreading their business with a great magical view, which set several interesting facts about them. The first store of the company runs the store 24 hours of the day and they sell fresh-brewed coffee in to-go cups. The conventional store retailer helps the guests by providing freedom of choice while forming soft drinks fountain in the stores. They have also started to sell the pre-paid phone cards from the year 1948 and ATM services for the customers, which was the first convenience retailer of them (Buchan et al. 2017).
Regulatory framework affecting 7-Eleven Stores Pty Ltd in Australia
Another important facts about 7-Eleven Stores Pty Ltd that they have a great technology service for redefining the way of shopping of the products. They have changed the technologies for successfully develop their strategies on the retail business. The advancement of technology has never impeded the operations of the company; instead, it has always resulted in the incline of its operations and customers (Buchan et al. 2017). The company also invented a mobile application for operating the whole function for the customers and it helps them to increase the customers. The company always focuses on the modern trends because it helps them to utilize their innovation and support them on the improved loyalty programs. It is the aim of them to cover all the requirement of the customer according to the digitalized era or the digital-savvy generation of customers (Sivaraman and Turner 2016).
According to the changes of the modern technologies, the organization always improves their technologies because they have a huge background on the significant investments in business and software processes. The revolutionary updates help the organization to control and manage the organization in an appropriate ways. The company is successfully manufacturing their products and delivering the fresh foods towards the customers across globally. They also look for the updated equipments that help into the improvements of the current business area. They believe in the innovations in their products, which could be set a wide variety providing towards the customer services. The strategies help them to achieve success to form the loyal customer base all over the world. Along with the growth and success of the company, it focuses to endure on making lives of the customers easier, healthier and happier (Buchan et al. 2017).
The4 regulatory frameworks, which are affecting the 7-Eleven Stores Pty Ltd for operating their business in Australia includes Fair Work Regulations 2009 (FW Regulations), Fair Work Act 2009 (FW Act), the Franchising Code of Conduct, Australian Competition and Consumer Commission and Australian Consumer law (Sivaraman and Turner 2016).
According to the business policy framework the company operates their business and franchises through the regulatory framework of Competition and Consumer Act and the mandatory Franchising Code of Conduct. The organization has affected with the Franchising Code where all of the multinational companies are regulated in Australia. Therefore, if such regulatory rules fail in the application in the business, then the Franchising Code provides safeguards to the franchisees and encouraging entrepreneurial franchisors. It is not possible for the franchises to enter into a contract or sign the agreement if they are not provided with any disclosure documents of the franchisors within 14 days. When they complete the procedure of signing the contract, the 7 days of cooling periods has started. In between the cooling periods, they get the rights to terminate the agreement. After completes procedure, the franchises get 21 days to deal with the due diligence and make it determined that the franchisers get the benefit to join in the particular company (Sivaraman and Turner 2016).
The impact of the regulatory framework on 7-Eleven Stores Pty Ltd
The requirements, which are applicable for the multinational companies sometimes affect on the operating of the business. When the documents disclosed publicly which provide the current information about the franchisor then it affects on the system and specified franchised business. Therefore, providing the documents are the part of the legal compliance, which could be, franchised the entire business with manipulated and false security. Here it also stated that the conduct of due diligence is only applicable if the franchisees are able to conduct the ‘halo effect’ of well-known brands such as 7-Eleven then the objectives will sue the diligence. The ‘halo effect’ is one of the important phrases in the marketing, which deals with the biasness of the customers related with any product of the company. It is one of the way of development helps the area which influence the opinion of the customers in respect of the another area (Webster 2017).
The franchise system is one of the difficult and complex parts, which are related with the contracts, always seek advice from the lawyers and accountants for their profound knowledge. It also provides alternative sources for obtaining information about all of the disclosure documents. The recruitment process of the accountants and lawyers is operated by the ASIC who are eligible to provide such information is both time-consuming and an expensive procedure. After the development of the franchise by the franchisor for its individual benefits, they can obtain for contract for set out the risks and obligations to the franchisees and retain the rewards. However, the regulatory frameworks should confer with the legal power on the franchisor in a franchisor-franchisee relationship. The Division 5 of the Franchise Code of Conduct stated the franchisors for the termination of the contract. Therefore, any crime committed by the franchisor or failure to pay back to the franchisee, or breached the terms of the contract then the franchisee has no right to terminate the relationship (Buchan et al. 2017).
However, in one of the case of 7-Eleven Stores Pty Ltd’s wage scandal the organization has involved in underpaying the employees where the franchisees suffered several financial losses. In that matter, they were unable to have access to any information, which may caution them about the existing flaws in the system. The franchisees were manipulated and presented with false wage records of the employees and suffered losses. Due to such issues, they have intention to earn benefits for the franchisors (Webster 2017).
In the marketing sectors, the asymmetrical nature of the franchise relationship is the most significant disadvantage for the franchisees of the company. There are several difference in objectives of the franchisor which leads to the loss of the company’s reputation and finance by them. However, a regulatory framework has formed for the application of the symmetrical and enforces on those common objectives for both the franchisor. Therefore, franchisee may able to provide a fair and organizational system (Sivaraman and Turner 2016).
It is necessary to identify the treaties, conventions or agreement, which have several impacts on the products or the services that multinational company, provides in Australia. A franchise agreement should enforceable under the Franchise Code of Conduct but it never stated any franchisors accountable if any actions taken against the franchisees towards their employees. They are bound legally for operated the business as financial and legally independent parties. The franchisors carried their business with their actual principles of uniformity of the goods and services, which are provided according to the system of the business under the ACCC.
Due diligence in independent small business and franchising
In the month of June of 2014, the Fair Work Ombudsman (FWO) have taken a step for the investigation in the company as they have alleged for the significant falsification of employment records and underpayment of wages in Australia. After the investigation process, the Work Ombudsman (FWO) has found that the company failed to operate the process according to the authority of Fair Work Act 2009 and the FW Regulations 2009. The Federal Circuit Court has taken a decision in recent issues where the company has alleged that they systematically exploited the employees of the organization and had deliberately, implemented a business model that intentionally disregard of the workplace entitlements of the employees of the corporate giant. Therefore, due to such fault, court has finned the company with $400000 on the bass of the offence of non-compliance of the company with the Australian laws and the regulatory frameworks that regulated or governed the business operations in the country. After such incident, the company has found to repeat the same disputes and they failed to perform according to the Fair Work Ombudsman for concealing and manipulating the wage record of the company (Webster 2017).
Under the franchise agreement terms, the franchisor can face legal consequences for not compliance with their responsibilities. Due to the involvement with the misconduct or non-compliance with the employees, the legal provisions has taken against the organization. However, the franchisors only concern about their profits only which they get from the profits of the organization. The franchisee could not assume the flaws that were present within the system and in order to provide the franchisors with profits, they developed false records and fabricated the entries into a payroll system of the 7-Eleven company.
Therefore, the inquiry process affect on the goods and services offered by the company. The company has been engaged in damage control measures as the company has suffered significant financial loss (Webster 2017).
The franchise agreement should consists of the clauses where the franchisor can request to the franchisee to provide the details of report about the business which help them to control and operate the number of employees and the amount of the wages paid by the organization. It is important to establish the cooperation between the franchisor and the franchisee would not only lead to the growth of the company but also satisfy its objectives, which is to provide customer satisfaction.
Reference
Australian Competition and Consumer Commission
Australian Securities and Investments Commission (ASIC)
Buchan, J., Frazer, L., Weaven, S., Tran?Nam, B. and Grace, A., 2017. The Adequacy of Pre?purchase Due Diligence in Independent Small Business and Franchising. Australian Accounting Review.
Fair work act 2009 (Cth)
Fair Work Regulations 2009
Franchise Code of Conduct
Hannigan, B., 2015. Company law. Oxford University Press, USA.
Hanrahan, P.F., Ramsay, I. and Stapledon, G.P., 2013. Commercial applications of company law.
https://www.7eleven.com.au/about-us
Sealy, L. and Worthington, S., 2013. Sealy & Worthington’s Cases and Materials in Company Law. Oxford University Press.
Sivaraman, G. and Turner, P., 2016. The 7-Eleven wages scandal: The need for law reform. Precedent (Sydney, NSW), (135), p.53.
Webster, J., 2017. More than underpayments and civil penalties–Taking a strategic approach to regulatory workplace relations litigation. Journal of Industrial Relations, p.0022185617705816.
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