In this episode of Retaili$tic, Deborah Weinswig interviews Jim Keyes, former CEO of 7-Eleven, exploring his journey from humble beginnings to becoming a leader in the retail industry. They discuss the transformative impact of AI on retail, the importance of understanding consumer behavior, and the lessons learned from both successes and failures in the industry. Keyes shares insights on leveraging technology, the significance of product variety, and the future of retail as a landscape of opportunity driven by change.
Video of this episode is here
Takeaways
AI is transforming the retail landscape significantly.
Jim Keyes' journey exemplifies the American success story.
Early jobs, like working at McDonald's, provide invaluable lessons.
Understanding consumer behavior is crucial for retail success.
Gasoline retail is a unique challenge due to its commodity nature.
Technology can enhance decision-making in retail environments.
Fresh and Easy's failure highlights the importance of local market understanding.
Change in retail is an opportunity for growth and innovation.
Imagination is essential for leaders in today's fast-paced environment.
AI has the potential to revolutionize industries and enhance human learning.
Chapters
00:00 Introduction and Background
02:36 Early Career and Lessons from McDonald's
05:33 Transition to Gulf Oil and Early Career Decisions
08:17 Journey to 7-Eleven and Strategic Planning
11:17 Understanding Retail Gasoline Business
13:50 Insights on Retail Strategy and Consumer Behavior
16:32 Technology's Role in Retail
19:13 Lessons from 7-Eleven's Success in Japan
22:02 Challenges Faced with Fresh and Easy
24:49 Conclusion and Future of Retail
25:01 The Fresh and Easy Experience
29:38 Lessons from 7-Eleven's Reinvention
32:42 The Importance of Product Assortment
34:58 Lightning Round Insights
37:37 The Future of Retail and AI
44:43 Harnessing AI for Human Advancement
Philip Moore (00:00)
Welcome to Retaili$tic, the official podcast of Coresight Research for November 18,2025. This week, CEO Debra Weinswig welcomes Jim Keyes, another legend of commerce. From modest beginnings in Grafton, Massachusetts, Jim exemplifies the American success story, rising to lead the turnaround at 7-Eleven and founding the Education is Freedom Foundation. He is the author of the book The Future is in Your Hands, and is an accomplished artist, musician, and commercial pilot. But before we meet this modern Renaissance man, Isla is here from the London office to share what's publishing this week on CoreSite.com.
Isla Meldon (00:44)
This week, we're launching a new series on how AI is transforming retail with a different sector focus for each day. We'll also break down key takeaways from Singles Day in China, including fresh insights from our proprietary consumer survey. And we'll round things out with the latest data from our US holiday surveys, consumer surveys, and earnings updates. Plenty of clear, focused insights coming your way this week.
Philip Moore (01:09)
Thanks, Isla. Now here's Deborah and Jim.
Deborah Weinswig (01:12)
Jim, thank you so much for joining us today on Retaili$tic. It is such an honor. And how are you? Let's start there.
Jim (01:19)
I'm great.
It's good to be with an old friend.
Deborah Weinswig (01:21)
It's very good to be with
we always do a lot of research to prepare for these podcasts. And we understand kind of what matters to you today. How did you get here and kind of where you started? And I'm a person, I like timelines. So I always like to start at the beginning. So in doing so, you have a fascinating background in terms of how you started and your family. you take us all the way back to the beginning?
in terms of where you grew up, what your family was like, and then we'll take the timeline from there.
Jim (01:50)
Sure, well, I was a sperm and...
Deborah Weinswig (01:56)
We're going way back!
Jim (01:56)
I was very successful.
We said go way back, you know? And I was a good swimmer apparently. All right, maybe I'll dial forward just a little bit. No, sorry, this is what happens when old friends come together to do a podcast. They throw away all the rules.
Deborah Weinswig (02:14)
That's true. That's very true. It's more fun. And it's
all the we talked about before that the camera even started. So this is going to be fun.
Jim (02:23)
Anyway, I grew up in Massachusetts, a small town, Massachusetts, no running water, literally three room shack, was not expected to, I didn't grow up thinking I was going to be a retailer. Last thing in the world I thought I would do is be in Thought I would end up in the factory where my dad was or my brothers and that was what we did in that little area that I grew up. Many of the families were factory workers.
I ended up first job flipping burgers at McDonald's. ⁓
Deborah Weinswig (02:53)
So that was like my first like I had paper ads when I was young but my first kind of real job was also McDonald's that's so funny.
Jim (02:58)
Yeah.
It's a great first job. know, Deborah, tell people,
I tell people all the time, you know, you don't realize, I appreciated Dial 4 when I was at 7-Eleven, I appreciated the franchisees so much more having been a shift manager at McDonald's because I said, you know, I just ran a shift. It was just a night shift. But I had all of the same challenges of a $20 billion corporation because
I had inventory management, issues, had advertising to consider, had staffing issues, customer facing issues, hours of oper- I mean everything was there all in one small, bite-size experience, which is what McDonald's proved to be. Great experience.
Deborah Weinswig (03:51)
I will tell you,
I learned so much, right? So everyone, pretty much either you're starting flipping burgers, you're starting on the counter. I started on the counter and it just wasn't like fast paced enough. I actually liked being on the grill more because I was like, you know, cause there's also like how much could you do at once? Right? And then there was this wonderful woman who would like throw the birthday parties on the weekend and.
like, really, you cause I think I was very diligent. She's like, you know, she needed somebody who was gonna like show up on time and whatever. And so I started to like work with her and throw birthday parties on the weekends. And then, but I was always, I'll tell you what I Actually, it's funny where I ended up in life is like on supply chain almost, right? Because it goes back customer needs their order in three minutes and 30 seconds, right? If they're going through the drive-through, right? They need it in one minute 30 at the front. So how do we make sure, right? Going backwards.
How can we deliver that on time at the right temperature? right. So I really will say it's so interesting you said that, but I learned, I actually still today go back and think sometimes like, how did we like process engineer and re-engineer what we did? When it wasn't meeting the customer, it was like exceeding the customer in terms of what they wanted. that's, that's cool.
Jim (05:01)
Yeah, exactly. Yeah. Okay, remember this.
Remember, time to lean, time to clean. Right?
Deborah Weinswig (05:12)
What's even funnier though is like, you know, there's this whole like McDonald's monopoly thing now I like I remember like I was there when we like did like the the monopoly like the little paper like is it technically is still and
Jim (05:16)
Yeah.
yeah, yeah, that was way before
me. You're a child. They hadn't even invented Monopoly yet. I take it back, the board game was invented, not Monopoly, not McDonald's Monopoly.
Deborah Weinswig (05:27)
⁓ I'm so...
⁓
That was such a brilliant. Alright, so you went from McDonald's. What was next?
Jim (05:42)
yeah.
from a couple of things like driving a truck and doing some other stuff just to make money for college, ⁓ first job out of college and then graduate school was Gulf Oil, of all things. I had talked my way into an internship for summer job while at Columbia Beach School and they hired me and sent me to Texas and I absolutely fell in love with Houston, Texas.
And they, ⁓ at the end of the summer, offered me a full-time job. And I was planning to go back to school. I was going to, I was, I did go back to finish the MBA, but I was hoping to get a JD MBA. the CEO and the president and also chairman golf had taken us, bunch of us as interns to lunch. And he literally made the offer right there, come back full-time.
finish the MBA, forget about the JD, come back and come work for us, which I did. ⁓ that really launched my career ⁓ at Gulf oil doing ⁓ &A work for the CFO right out of grad school. Fascinating experience.
Deborah Weinswig (06:46)
you.
It's so interesting. So I was at PwC as an intern. I had wanted to be a doctor, but couldn't stand the sight of And I had gotten, was pre-med. And so I knew I looked numbers, right? Not right. Like I think seeking not that much advice, obviously I was like, I like numbers, accounting is numbers. Let me study accounting. And so I...
Jim (07:08)
Ha ha.
Deborah Weinswig (07:10)
I interned at PWC as a junior in college and on my last day of my internship they gave me an offer. And I think the HR person literally almost fell out of her chair she's like, like, I'd like to extend you this offer. I'm like, I accept. She's like, no, no, she's like, most people don't accept. She's like, I don't have an offer letter or whatever. And I said, it's okay. I had, going back to I said, I worked with people who...
Jim (07:22)
Wait!
Deborah Weinswig (07:34)
I very much respected, I said, I really respect this company and this is where I want to be, right, for my full-time job. And so I, they literally like that, that story was, I would say I was infamous. ⁓ And so that, you know, it's interesting in terms of where you begin, right? And then when I was in grad school in Chicago, I received a full-time offer, same thing almost, like on the last day of my internship.
And my boss at the time, actually have to hand it to her, it was Dana Telsey. And she said, right, you know, going back to somebody who cares about you, she said, do not take the offer. She said, you need to go out there and see what's And, you know, if we're right for you, you'll either accept it now or come back later. And I ended up, I ended up starting at Morgan Stanley a strategist, which was, you know, the best from somebody who's going to do research their lives, right? Having a macro background was phenomenal.
And then about two years into it, was like, you know, I really liked, I loved retail, right? It was interesting because, and the more I studied strategy, I'm like, the consumer's two thirds of GDP, I need to understand retail to understand more of the macro. So it is interesting how those kind of internship experiences can truly change your life.
Jim (08:43)
Absolutely, that's kind of what happened to me. People say, well, did you sit around and say, I want to be CEO, here's a path, I'm going to do this job and this. Heck no. I mean, I was so far out of my range expected outcomes that I was just trying to do the best I could in whatever I could and bumping along ⁓ candidly. yeah, the...
oil company background led to 7-Eleven had acquired, if you remember, Citgo Petroleum. And here's this retail company that bought an oil company. They had no idea what to do with it because it had refining and marketing and pipelines and refineries, all this stuff. And ⁓ so they said, well, we better get some oil industry guys to help. And they reached out to
a gentleman I was working with at Gulf oil to bring to be CEO of Citgo petroleum. The South incorporation once they bought it, reached out to a guy named Ron Hall to be CEO. Well, the irony was that in my &A work for golf, the top of my list was city service. So I had been studying city service upstream and downstream for about a year. And I probably knew more than anybody else in the country about
City Service. Well, here I am now with an opportunity to go ⁓ work for the downstream of City Service acquired by 7-Eleven. And it was a great fit. And I ended up there as the head of strategic planning at what, 23 years old or something like that. I was a kid. Yeah. And that was how I got to 7-Eleven, literally. We ended up selling Sitgo after a year or two. We
Deborah Weinswig (10:19)
in the US. ⁓
Jim (10:29)
basically turned it around. When they bought it, they were losing all kinds of money. We turned it around, made it profitable, sold the oil company to pay the base of the government oil company of Venezuela. And at that time, the South Incorporation CEO, Thompson's Jerry and John reached out and said, well, Jim, why don't you stay with 7-Eleven and run the retail gasoline business, which is, I was anything but an operator, as you might guess.
green kid right out of grad school that had done, planning, financial work, and now all of sudden they gave me a chance to run a two billion dollar retail gasoline operation. It's quite a privilege.
Deborah Weinswig (11:08)
So how, I I always, I had had an opportunity at one point to, I went through the interview process and received an offer to basically be like a I kept thinking in the background, I'm like, know, everything, like the way the world of that organization is then like on your shoulders, right? Like you sneeze, right? You might miss something.
How did you kind of take that responsibility on and how did you kind of figure out what the organization needed?
Jim (11:36)
Well, let's take that one. There's a great example. So it's a retail gasoline business. I was not an operator. I had never run anything. I wasn't really a leader or an operator at all. It came down my ignorance turned out to be an advantage. I said, I need to understand this business. I need to understand how it works. And when I did that,
I had the huge advantage of not being from the industry because here's what The oil companies were all by the upstream, the oil and gas guys, right? They would spill more oil out of the well than they would ever make at So retail for the oil companies was just basically a monetization of crude. Let's just sell it as cheap as we can and get rid of this stuff.
Because the more gasoline we sell at retail, the more crude oil we can pump and that's really where we make all our money. That was the logic. So all of the people that populated the retail gasoline business knew one thing, how to drive Nobody was held accountable for making money because they made their money Well, here's now a major oil company division that goes into a ⁓ retail public company, 7-Eleven.
and no one there knew how to make money. They knew how to monetize crude.
Deborah Weinswig (12:58)
interesting.
Jim (12:59)
Yeah, so what I did is went back to the basics and said, well, how do I know selling more gasoline cheap at 7-Eleven is really driving anybody inside the store? That was the logic. It was a loss leader. We don't care if we lose money on it because we're going to pull people in. I said, I don't know. Conceptually, stuff inside the store is pretty expensive. Somebody's going to drive two miles out of their way for a penny a gallon.
Are they ever even going to go in the store if they're that price sensitive? So we started doing like simple regression models to try to measure the relationship between incremental gas gallons and incremental business. And what I found is zero correlation. I just used basic tools that I learned in grad school. And I was like, wow, this is interesting. This stuff actually works. That means
Deborah Weinswig (13:43)
What?
Jim (13:51)
But there's no correlation, I'm not driving customers inside, maybe I should try to make money on the sale of gasoline. So literally we developed a process sampling competitor prices and figuring out who was the primary competitor for every store that affected our volume. And what we would find is we would then price a penny above, match them, and a penny below.
Deborah Weinswig (13:56)
Thanks.
Jim (14:18)
And we see what that did to our volume. And what we discovered was that we had a lot of elasticity in gasoline pricing and we could price higher than we ever did before because people weren't coming there for the price anyway. They were coming there just for the convenience, primarily, of buying gasoline at 7-Eleven because it was on their way to work or something. And they certainly weren't going in the store. So when we modified the model to maximize that balance between margin,
and volume. We made a ton of money that really propelled my career. All of a sudden gasoline went from a losing proposition at 7-Eleven to it was the most profitable of the company. I think it still is today.
Deborah Weinswig (15:03)
And what did you learn about what drives volume to gas versus what drives volume to retail?
Jim (15:11)
Unfortunately, I didn't want to admit, but gasoline is a pure commodity. mean, everybody buys it from the same sources. And it used to be back in the day, they'd have people on the lot washing your windshield and they could charge for other services. a couple of companies like Chevron put something called Tecraline or something they claim is an additive. It's a bunch of hooey. ⁓ Maybe there's a little difference, but it's not.
noticeable enough so that it's very hard to differentiate gasoline. So basically our premise was our primary differentiation is the convenience of the location. Let's not try to fool ourselves and think that get two cents more than Chevron because they're a branded product, but we don't have to be two cents less either. So we can find that sweet spot for 7-Eleven.
So the outside of the gasoline pure commodity, pure location convenience from my perspective and some things like is the lighting good? Is it safe? Are the pumps clean? Those basics are fundamental to any retailer. discovered, thought when I first got 7-Eleven, we were bankrupt in 1991 and part of the problem was,
We thought we had to compete with everybody. we I looked around the store, everything was a lost leader. We were selling beer cheaper than anybody else, cigarettes cheaper than anybody else, soft drinks cheaper than, at the end of the day, we weren't making any money on anything but a Slurpee. It's hard to make money on Slurpees alone. So we started looking at those models and realized, you know what, people aren't really coming here for price. They're not looking for a
anything in the store if we're in stock and we're satisfying that convenience need we can make more money so we actually believe it or not discovered that being in stock the number one out of stock item in the store was Marlboro light one hundred's which was the number one selling item when we got in stock which finally we had data to run the stores we discovered that we could not only price higher
but we would sell more just by being in stock so we ended up taking a declining category turning it around and driving favorable volumes with an increased profit margin was unheard of but it was the power of strategy and data
Deborah Weinswig (17:39)
I mean, it's really interesting. It's so funny how our world's...
Jim (17:40)
It works.
Deborah Weinswig (17:44)
kind of overlaps. So when I was at Citi, we were, you know, in like 2013, they even started in 2012, right? The kind of, put it the dismemberment, right? Between kind of refining and retail. And I remember finding it incredibly interesting because once again, I didn't know anything about the refining business, et cetera. And then how do you tell a good retail story? And going back to, really was all about
Jim (18:10)
was a
It was, it was. Now, you know, I think honestly, few people have tried to differentiate gasoline. If I was to get in the gasoline business today, I think there is opportunity for people to do a better job with branding. I think you can take things like cleanliness, bright lights, state of the art dispensers. I'd even consider at some locations putting back service because
I think a lot of people are used to pumping their own gas, it would be nice to have very efficient service. Get in, get out, wash your windshield, those things. I think people will pay for a differentiated offering like that, but you don't see very many people even trying today. Basically, it's just down to dirty, competitive,
Deborah Weinswig (18:55)
It's so interesting, I'll take me to my next question, had thought during the pandemic, right, and as it relates to what you just said, is this idea that the consumer was doing buy online, up in the store, and for them to start to develop a relationship in a different way retailer.
that would further extend into, you you've got somebody coming out to your car, they have information that might enable them to sell other items to you or at least make your experience better. And I've always thought the same about gas, right? Because you're starting to develop one-to-one relationship with the consumer, and especially if there's any kind of loyalty program.
that, I agree that it seems like a huge opportunity. So let's take kind of the next step in that. Jim, one of the things we are always talked about and I think enjoyed discussing was right, the opportunity technology to positively impact the consumer and also the bottom How did you start to think about technology from a retail perspective? And did you build your team as a
Jim (19:51)
Yeah, thank you for that. That's one of my favorite stories. And people don't realize the power of technology is an enabler for any business, much less retail. But retail, it's critical because, especially convenience retail, because here's my, I'm going to take it down to basics. This is my favorite retail example. I don't know if I've ever shared with this with you, but you're walking down the street in New York and you see the guy selling the handbags, Fake handbags, little blankie.
Right out there on the street. I had cheap handbag all of a sudden one drop of rain falls. What Handbags are gone. Right. Out come the That is that is retail 101. There is no finer example of convenience retail than that. It's like you need a you need an umbrella. I got it, man. I went from handbags to umbrellas. One drop of rain.
Deborah Weinswig (20:19)
Yes.
That's it. Yeah.
Yep.
Jim (20:45)
And now think about how hard that is when you've got store, a physical brick and mortar store. It's hard. But here's what technology did for us. 7-Eleven was having a hard time selling a decent quality hot dog in the United States. I get the opportunity to go to Japan when we all of a sudden they take us out of bankruptcy, our licensee there, and they're selling restaurant quality sushi in the stores. And I'm going,
How do you do this? They had four times the sales in half the square And they were doing it with deliveries coming three times a day. And I'm going, how is this even possible? And what it came down to is using technology as an enabler to make more effective decisions in the store. They were the brick and mortar model.
of that handbag seller, when a drop of rain would fall, they'd switch to umbrellas. They would that little thousand square foot store three or four times a day. when they're, yeah, absolutely, absolutely. Breakfast, lunch, dinner, the store would even look different. You'd walk in and go, whoa, I was just in here three hours ago. Now it's, now it's merchandise for fresh sandwiches. This morning it was out with muffins and bakery items. How'd they do that?
Deborah Weinswig (21:45)
Seriously. ⁓
You
Jim (22:02)
And what they were doing is using technology to get down to the details of buy SKU by hour of the day, what was selling and what wasn't And then it was a constant process. Get the stuff that's not moving, get it out of here. Because every store was a unique footprint and a unique demand model. Store in an office building, entirely different demand model than a store a block away in a residential building.
And so they could, with that data, customize that store, make most efficient delivery of product because they were able to forecast it very accurately. But here's the secret sauce that no one ever gets. And in a classic example, Tesco, you know, came to the United States. We're going to build the convenience store of the future, fresh and easy. And I had the privilege of cleaning up the mess over there. And I asked the chairman, what will you do?
Deborah Weinswig (22:59)
I don't think
I knew that.
Jim (23:02)
Yeah,
yeah, they gave us basically they gave us the stores and said here do what you can
Deborah Weinswig (23:08)
Wow, that's, you know, it's so funny. I, Fresh and Easy has come up like literally three times the last week. as an analyst, right, I went to one of the analyst meetings and I still had like my tote bag. And it was just like, I think I went to the grocery store and like something ended up, I was like, I had a, let's just say it got recycled. Two, there was, someone sent me a video that they'd done many moons ago and like Fresh and Easy was like in the background. And then three, we were just talking about, right, like,
Jim (23:19)
Yeah.
Deborah Weinswig (23:35)
how difficult it is sometimes to do grocery in the US. So it's so funny, I don't think I knew that you ended up on the other side of that.
Jim (23:41)
Oh yeah.
Oh yeah. No, I had just bought into the Wild Oats brand. I was looking for a store footprint to take the Wild Oats brand to fresh and easy was they had Tesco had lost $2 billion on this thing and they were bleeding cash and they basically gave it to us and said, goodbye, good luck. But here's what they missed. And so I had an opportunity to sit down with the chairman and say,
Okay, guys, what were you trying to accomplish? And they said, well, we were trying to copy you guys at 7-Eleven. We built the 7-Eleven model in a small box store. Now it wasn't small enough. They were really 10,000, 12,000 square foot stores, more mini-marts than convenience stores. But he said, but that's still wasn't the problem. He so we copied everything. We copied the commissary, the distribution center.
They built this fabulous enterprise out in Riverside, California to distribute to all the stores within a 500 mile radius. ⁓ so we had everything in place and we just couldn't make it work. Here's what they missed. They copied everything physically. Distribution, commissary, small stores. They missed the most important ingredient that the technology that drives 7-Eleven doesn't take the thinking out of the store.
It enables the retailer to be a better retailer. So this is a beautiful model because we're all afraid of AI, but this is a classic example where people forget that the retailer has eyes and ears, the computer And when the store is under construction, the street is under construction, that retailer knows. It'll take a week for the computer to catch up. If there's a special event tonight, the customers across the street from the store, the customer's telling the
Deborah Weinswig (25:09)
Yep.
Jim (25:30)
the store operator, knows that there's a special event I'm going to order appropriately. If the football is in town, they know. So here's what Tesco did. They built one store in a warehouse in LA and one product assortment. They bring people in to try to refine the product And then they laid out that product assortment all over the whole city of the whole the whole state. So a store in Beverly Hills.
sold scones. Store in Compton sold scones or didn't sell scones. No no churros. ⁓
Deborah Weinswig (25:59)
Ha!
I mean, I'll tell you
from my perspective, like the issue was, right, they had the cement, right, that gray cement flooring. So it felt very cold. Seral, yeah, cold cereal. Then, right, if you remember, they wrapped all of the produce, which is now what we do here in the US, like under saran. So you couldn't, like, so the main purpose of going to the store, which was to, right, like,
Jim (26:16)
sterile. It was very sterile.
Yeah. Yeah.
Deborah Weinswig (26:32)
check out your produce, you couldn't do. And so then there was that. like the third thing, and at that time there's just, there's too much, I think, private label for the U.S. I mean, I think now that's a very different, that's very different. And then the other part, and then the fourth know, this kind assortment. And then the fifth, right, the checkout was not. Yeah. Yeah.
Jim (26:46)
Yeah.
Very clunky. Yeah, the automated check-out was very clunky. It was early.
Too early.
Deborah Weinswig (26:59)
Yeah, so it was it was interesting. mean, it's funny, like what you remember. Like I said, this is like something I've actually been thinking about lately, but I was like, because you like Tesco is such a juggernaut behemoth, whatever appropriate word you want to use. And I was I was really how miserably they failed coming to us because it just. It was shocking.
Jim (27:14)
Yeah, it was shocking. was shocking.
But the other thing they did was they tried to price. Retailers get suckered into this low price game. you know, look what Arowan is charging now. And the irony is that Fresh and Easy had all natural and organic foods throughout the store. People didn't even realize that. It was Only they tried to price competitively with Trader Joe's and the lowest prices in the market.
And so here's what happened. One of the first stores I went in, I was, I'm walking around the store and I walked up to a customer and I said, so do you like shopping at Fresh and Easy? And she said, this is my first time here. And I said, good. I'm so glad you came. Why did you decide to come to Fresh and Easy? And she well, my company is buying food for the homeless and I see this as a place that homeless come to, get their stuff. Cause I thought, man, this is going to be a challenge.
But that was the perception because it was cheap and then, you know, they would stretch the product code. They try to make it last. So the stuff didn't look fresh often. And then they discount it to try to get rid of it. So the homeless would come because they had really good food that was heavily discounted at the end of the day. So it was just a host of errors. But the number one mistake that Tesco I is that retail is a very, very local
Deborah Weinswig (28:19)
Yeah.
Jim (28:41)
proposition even Walmart makes this mistake I think they try too hard to simplify the the process of Merchandising all of the stores in the same way so they have they have store sets they have whole groups of stores like product sets for different technology today you can customize the SKU assortment literally by store. You don't need to
groups of stores with the same product assortment for convenience, you can tailor individual footprint to the actual demand in that individual store and then empower that retailer to make those decisions about which products stay on the shelf and which get off the shelf so there's more room for the products that are best sellers. That's the secret sauce of 7-Eleven Japan. That's how they made it work.
And I have not seen a retailer in the United States that gets it, that can manage that, because it requires discipline and the effective use of technology to enable retailers not to override the retailer and make the decisions for them.
Deborah Weinswig (29:49)
So as you think about the experience with Fresh and Easy, what did that tell you about customer behavior that you didn't know before?
Jim (29:59)
Customers want new they want variety they want they want to be excited. They want to see well first of all friend Freshness quality is critically important. I think way more important than price And they want to see they want to see that quality. They want to see the freshness. I don't think there is Worried about the environment now right the Tesco stores. They were sterile. They were a little cold I think you can overcome that with
the right products and the right quality of products stores. I'm not as much a cosmetics guy in terms of the store appearance as I am. Having the right products on the shelf at the right price with the right quality level, I think it all comes down to you are what you sell.
Deborah Weinswig (30:43)
Yeah, no, I mean, I think that that makes a lot of sense. So what was next kind of after Fresh and Easy?
Jim (30:48)
Well, first of all, fresh and easy was just a few years ago. That was picking up the Tesco pieces. I did and at 7-Eleven I had the privilege of sitting in virtually every chair. You people say, well, how'd you get to be Well, I had started out after the bankruptcy. The bankruptcy was actually an opportunity. In fact, I'll give you a little slogan. I've coined the expression. I got a book out, I think you might know about.
And I coined the expression in it, change equals opportunity because the acronym CEO, I didn't realize until I wrote down those three words is really what the role of the CEO is all about. And I learned that at seven 11, that change was opportunity because we were in bankruptcy. I thought my career was dead. I don't think I could have gone from joining the company to CEO of a company in a successful company in a 12, 13 year.
period of But at 7-Eleven, because of the problems we had, it forced the company to reinvent itself. Change equals opportunity. It forced reinvent myself. I ended out of the bankruptcy running strategic planning for the company, then became CFO of a public company. You're an accountant. I had one accounting class. And I'm CFO of a public company. I couldn't do that in a successful company.
Deborah Weinswig (31:51)
Hmm.
Jim (32:11)
But they needed me at that time in that role. And from there, I went to chief operating officer, ran marketing for a while, and ended up, when it came time to pick a CEO, I had sat in every chair. Which is something that you couldn't have done potentially in a company that hadn't gone through all of that disruption and challenge. So change equals opportunity. For me, it was a fast track to the role of CEO.
Deborah Weinswig (32:29)
of this.
Jim (32:38)
And for the company itself, 7-Eleven has 90,000 stores now. That change and that disruption actually forced us to reinvent our business model. And candidly now, 25 years later, or 20 years since we sold them, they need to do it again.
Deborah Weinswig (32:54)
Yeah. so I've always...
I have no idea why, to be quite honest, but it's like you find that there's a certain area of retail that really resonates. And so I started off as a food and drug analyst and then I ended up covering luxury and specialty and I did some healthcare and what I always fascinated me and maybe it was like Walmart ringing in my head when they were talking about dropping all these neighborhood markets across. I I think we literally had like, Lee Scott on the dais when I was at Morgan Stanley and he's talking about how they're gonna like, you you're paying $5 for a stick of deodorant. I'm like, yes.
And he's like, you know, we can undercut that. know, this was again, no Walmart neighborhood market ever came to Manhattan. Secondly, started to realize how difficult it is to operate small boxes. three, you realize globally the opportunity to do small box really well. And so I've always been interested in the especially now as you have a lot more kind of last mile, quick commerce, whatever we want to call always incredibly interested in
in small box because I think it's very hard to get it you think are some of the, because if you think about it right now, we have quick commerce. have, mean, if you look at, for Double Eleven, the shopping festival, one of the top five areas of focus has been quick And so interesting.
Jim (33:55)
Yeah.
I
Yeah, you know, after spending most of my career there, I'm convinced that it comes down to one thing and most people miss it completely. It is all about product Because if you're gonna be convenient, I'll take you back to my John Thompson story when I started at 7-Eleven and I went to ask him, ⁓ in bankruptcy, I said, John, should I leave the company? And he said, all I can tell you, Jim, is, ⁓
told me the story of how they started. His dad started in an ice 1927 and in 1929 somebody invented the frigid And he said, if we hadn't changed, we would have been out of business by 1930. But we realized that we weren't in the ice business. We were in the convenience business. And his advice to me is, Jim, cigarettes will come and go. Beer will come and go away as a convenience item.
But the need for convenience is never going to change. your job, should you stay with the company, is become obsessed with finding things that people need conveniently and delivering on that promise. And that's exactly what we did. every SKU at 7-Eleven was designed to be able to be in and out. If it's not meeting today's convenience needs, let's minimize it and let's get it out and make room for something that is.
And that's an obsession with product that honestly I've seen very few retailers in the United States that get. Too often the retailers go, that's the supplier's job. I'll let Frito-Lay manage my shelf. I'll let Coke manage my shelf. No, it's the retailer's job. And to me, that's the difference. A number one.
Deborah Weinswig (35:48)
Yeah, no, I
couldn't agree more. We have a lightning round that we're going to go into for the last few minutes. So you can say what comes to the top of your mind. And if you want to pass, you are more than welcome to. But I do find for me, I'm like, you know, it never turns out the way you expect. So we'll get started. right. So number one, morning fuel, black coffee, energy drink or something healthier than both. today.
Jim (36:13)
Not crossed.
Deborah Weinswig (36:15)
dark roast, cream or sugar.
Jim (36:17)
No, no, straight up. Straight into the mains.
Deborah Weinswig (36:19)
Okay, that's healthy too.
Well, it's funny and I totally digressing. So I grew up, I spent a of my childhood in so we had like cowboy coffee. As kids, we're drinking cowboy coffee, right? Which was like some coffee, a lot of sugar and a lot of cream. But yeah, like I said, I grew up very early on coffee. Number two, more important for a CO today, imagination or discipline?
Jim (36:44)
imagination.
Deborah Weinswig (36:45)
7-Eleven Association.
Jim (36:47)
Creativity is intelligence having fun.
Deborah Weinswig (36:49)
I like That's a good one. 7-Eleven Association late night snack or data goldmine?
Jim (36:50)
Einstein.
Data Goalman.
Deborah Weinswig (36:59)
Black, blockbuster in one word today, lesson, regret or myth.
Jim (37:02)
A lesson, fabulous lesson that most people miss because they stop at they didn't keep up with technology, which is false. Excellent case study, cash management, vendor managements, management, consumer response, so many lessons inside the blockbuster example. But if you stop at they didn't keep up with technology, you miss the best lessons there.
Deborah Weinswig (37:25)
That's a good one. Greatest teacher success or failure.
Jim (37:30)
You learn from your mistakes. You don't grow muscle by going to the gym and making it easy on yourself. I never lose. I win or I learn.
Deborah Weinswig (37:38)
like that. First thing you look for in a board deck, the numbers or the assumptions.
Jim (37:43)
the assumptions. The numbers will follow.
Deborah Weinswig (37:46)
And what's fascinating now, was at one of the boards I sit on, we use Diligent, and I went to a conference they had, because I'm like, why not as a board member upskill myself? And it was fascinating with AI. I I spend hours and hours and hours reading board documents, because I wouldn't miss one little thing. And right with AI Now, you can summarize.
And you can say like, you know, I'm the chair of Audit or I'm the chair of, you know, Nom and Gov. do I need to make sure that I'm like, and I'm like, this is, you start to think about the hours you save and maybe the items, but I also worry a little bit that some of the subtleties, things that we really need to dive into, we won't, but it is fascinating in terms of how a lot of that is changing. Harder job turning around a company or changing a culture?
Jim (38:29)
It is.
changing a culture. It's the hardest part of turning around a company.
Deborah Weinswig (38:37)
Hmm. an interesting point. ⁓ One word that describes the future of retail, physical, digital, or something else.
Jim (38:44)
combo. No one has cracked the code on the last mile.
So truly the ability to have delivery in a convenient fashion when I need it, like right now. And that will take some physical and digital combination.
Deborah Weinswig (39:00)
⁓ mean, to me, what's so fascinating about like brick and mortar is how, right, Gen Z, that's part of their, like I like to call it unified commerce. I was never a big omnichannel. never liked, it was the idea that there are different channels. I'm like, it's just retail. So right with them, because I don't know if they like embodied sustainability or it's just a natural outcome of how they shop, but.
Jim (39:01)
why I like still brick and mortar.
Deborah Weinswig (39:28)
They shot much more like, we've studied from the Chinese consumer perspective, they're doing a lot more research. And it's probably easier for them to do too. We just saw that like Double 11, day, that the consumer is consuming so much more research before they transact. And with Gen Z, they go to the physical store, they see the item. You can measure out the dimensions, but sometimes seeing it, especially like top of counter, that makes a huge difference.
80 % of them will touch the physical store at some point during their visit. And those are numbers we haven't seen in a long time. So I would agree with you. I think it's fascinating. All question. Bigger risk for leaders now, moving too fast or moving too slow?
Jim (40:12)
Moving too slow, think change equals opportunity. I really believe it does. That all commerce begins and ends with change. And ⁓ fear is the biggest culprit. It's the biggest killer of careers, the biggest killer of corporations, because people are afraid to make a mistake. And they're not out there embracing change, leveraging the newest technology that's possible, taking advantage of that technology to keep pace with change. And to me, that's what it's all about.
Huge opportunity.
Deborah Weinswig (40:42)
really interesting you say that because felt like mid-year there was a dramatic change we saw with regards to really like the C-suite. think even more specifically like the CEO was like we want to do POCs and AI, but only if they're going to be successful. don't want to fund them, right? Maybe we wait until 26 and then something started to see a change in was like
let's go fail, right? Like, and it's not the fail fast, that's all I think, you in the books, if you will. But it's like, it doesn't matter if we win or lose in this kind of trying new things, but if we don't try them, we don't build any muscle memory. And we also don't know what works for our organization or doesn't and why, right? did that fail? And so we're working on a few projects right now, actually some of the cases the boards brought us in.
And so in some ways, I actually thought it was really smart because they're giving the CEOs permission, right? This is us telling you what to do. And we just want you to kind of go out there and play in the sandbox. And if it's right or wrong, it doesn't really matter. We just want to see what you learn from that. And I actually think they need a talk track to tell the street on what they're doing in AI. It doesn't matter. Once again, like we tried this, it didn't work, but this is like what we learned.
I've never seen that in my career quite like it. I don't know about yourself.
Jim (42:02)
Yeah, I think it is changing, ⁓ let me take you back to, for a minute, just the internet. Remember when the internet first came out, everybody said, my god, my god, it's gonna take away all our jobs, and no one's gonna ever go to a store anymore, and there was all this crazy speculation. And I love this story. I tell this story all the time. If I told you 20 years ago, we're sitting around, we're having a glass of wine, and I said, hey, Deborah, guess what? In 20 years,
you're going to get in a stranger's car. You're to call up a stranger on your phone and you're going to get in his personal car. You've never met this guy and he may be from another country and you're going to drive across town and then you're going to go sleep in a stranger's bed in their house and you're going to sleep in there and then the next day you're going to get in another stranger's car and you'd be like you are out of your mind. I would never ever. Yeah.
Deborah Weinswig (42:56)
or you're gonna wear a stranger's clothes, you might
rent your clothes. Yeah, I mean, it's, or you may like, or you may write like, buy old food at the end of the day from a retailer and think that you've like won the lottery.
Jim (43:01)
⁓ yeah, ⁓ yeah.
yeah, yeah, you may buy. ⁓
yeah, exactly, exactly. You would say absolutely no way would I ever do that. You're crazy, Jim. You are nuts, right? So I mean, think about what the internet spawned entirely in new industries that we just can't sit here today and imagine. And that's where we are with AI. We're on the cusp of some really amazing opportunities. But those of us who are sitting around saying, I would never do that.
You know, we're not going to be the ones that invent those new opportunities. It's going to be those bold risk takers that are out there trying saying, hey, I don't know it's going to work, but man, look what we can do with AI that we couldn't do before. And it will spawn entirely new industries, right?
Deborah Weinswig (43:57)
Yeah, and I think it'll develop trust in a different way. And what we're seeing, which I don't know if I had expected, but like the power of community is I've never seen anything because also too, right, and we have this AI council where we meet once a month, right, the opportunity to kind of talk about things you think are true. And I mean, I will say and I probably shouldn't, but whatever. In our last meeting, someone was like, you know, who's working with like OpenAI for the
Jim (44:06)
Yeah.
Deborah Weinswig (44:26)
holidays, right? On this whole like, agentic and like, nobody, nobody spoke. And so a lot of this, right, where everyone's like, everyone else is ahead of us, that is not true, right? Like, wherever you are, you can be sure everyone else is in the exact same place. And they're talking a good game. But I also think what's really interesting with AI is
Jim (44:40)
yeah.
Deborah Weinswig (44:45)
It's not a leveling, of course there's democratization of the ability to do But you can have two competitors sitting across, I here we have a lawyer, but sitting across the table from each other, and they can talk about what they're doing, but because of their tech stacks, their data, if they have a CDP or
what they can do is completely different and it's not it's not competitive that's i think the biggest change that we've we've seen and it's also now we're on a totally different topic it's not a zero-sum game anymore with so many of the other things changing like glp1s and there's other right exogenous factors are having an impact on consumption and
I don't know about you, Jim, but I think it's the most interesting time I've ever seen to cover retail, which is what keeps the blood flowing through both our veins, right?
Jim (45:26)
yeah.
no, absolutely, it's fascinating. And let me leave you with one last thing that we all get asked a lot, is AI going to take away all our jobs? Are the machines going to kill us? Blah, blah, blah. We have all these fears. if you go back, and every time throughout history there was a big breakthrough in science, there was always fear around it. But here's the biggest thing I get excited about with AI.
Human learning, let's face it, we have not progressed as humans a thousand years. We're still teaching and learning pretty much the same way. And yeah, maybe we're a little smarter than we were perhaps, I don't know, a thousand years ago. today in America, 31 % of our fourth grade kids are functionally illiterate in America. And you go, how is it even possible in this day and age, right? But AI has the
to individualize learning versus the standardization that the industrialists put into the public school systems 100 years ago for the expedience. It was like mass producing model T-Fords. We were mass producing educated workers. We can individualize learning now and kids are getting it today. Everybody worries about what they're seeing on the internet. They're learning a lot on the internet at a rapid pace.
Deborah Weinswig (46:25)
Yeah.
Jim (46:50)
very different style of learning. But if we can harness the power of AI and have human learning advance at the same exponential rate that we've discovered machine learning can advance, I think that's possible. We're all walking around with a computer that we use about 10 % of. And if machine learning can help us use 20 of that computer, we're going to elevate humanity in a way that
Deborah Weinswig (47:10)
you
Thank you.
Jim (47:18)
I don't worry about the power of machines. I'm excited about the power of humanity and what we will be able to do that we can't even envision as we sit here today. It's pretty exciting.
Deborah Weinswig (47:29)
it's unbelievable. Well with that, thank you so much for joining us. Your wisdom always exceeds our expectations and thanks for sharing your story with us today. Thanks for joining Retellistic and we look forward to having you again soon.
Jim (47:41)
Thanks, Debra. It's not wisdom, it's just age.
It's the only advantage of getting old.
Deborah Weinswig (47:48)
⁓
I think the wisdom piece of it is pretty impressive because goes back to, like I always thought like back to the strategy side, right, like patterns. And it's always like, what's different this time?
And at the end of the day, I still remember I've got Barton Biggs, right, when I was in Morgan Stanley, ringing in my ears. He's like, it's always reversion to the meme. Just remember that. And, you know, words to live by. So thanks again. Yeah, this is great.
Jim (48:15)
Thank you, Deborah. Enjoyed it. We'll do it again.
Philip Moore (48:19)
Thanks Deborah, and thank you for joining us this week. Coresight Research serves our members with leadership communities, data resources, events, strategy sprints, proprietary research, and more. Visit us at coresight.com to learn how joining our community can accelerate your success. Have a wonderful day, and we'll see you next week.