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Seven-Eleven Japan enters online market with food home delivery

'Net Konbini' offers 24-hour service as rivals Rakuten and Amazon pile in

The new service, Net Konbini, plans to reach 7-Eleven's entire Japanese network of around 20,000 stores.   © Reuters

TOKYO -- Seven-Eleven Japan, operator of the country's biggest convenience store chain, will launch smartphone ordering for delivery in as little as two hours, the company announced Thursday.

The move marks a first for the convenience store sector in Japan, with Seven-Eleven looking to capitalize on food home delivery demand as online rivals such as Amazon Japan make inroads into the highly competitive field.

The new service, "Net Konbini" -- using the commonly shortened form of "convenience store" in Japanese -- plans to reach 7-Eleven's entire Japanese network of around 20,000 stores, following a soft launch in October 2017 at 25 stores in Hokkaido, in northern Japan. It plans to expand the network to 1,000 stores in Hokkaido by August 2019.

The service allows users to place orders 24 hours a day, selecting a delivery address and store to choose from 2,800 available products, including Japanese convenience store staples such as rice balls and bento lunch boxes.

The company hopes for an edge in linking its market-leading retail store presence with online reach. "Using 20,000 stores to immediately deliver any of 2,800 products is a service only Seven-Eleven can provide," said company President Kazuki Furuya at a seminar Thursday. He foresees no difficulties expanding the service nationwide, he added, since the company intends to use as drivers the ready workforce of female workers who live near the stores. 

Delivery trucks en route through 7-Eleven outlet areas will pick up orders and drop off purchases to customers, in a tie-up between Seven-Eleven and a subsidiary of logistics company Seino Holdings finalized last year. The minimum order value is 1,000 yen ($9.14), with a 216 yen delivery fee, which is waived for orders over 3,000 yen. The target customers are people unable to leave their house or who require rapid delivery.

Although supermarkets have begun to home-deliver in Japan, the development marks a first for convenience stores. Seven-Eleven has run meal delivery service "Seven Meal" since 2000, but the program is limited mostly to the chain's prepackaged foods line, such as lunch boxes. 

As Japan's convenience stores expand services to combat steadily falling traffic, fresh food delivery is presenting a new battleground for retailers. Amazon Japan began its "Amazon Fresh" grocery service in April 2017, and the country's dominant e-commerce operator, Rakuten, is preparing to open an online supermarket with Walmart subsidiary Seiyu.

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