There are many reasons why foreigners might own convenience stores. One reason could be that they are looking for a stable investment in a developed country. Another reason could be that they see the industry as a growth industry with potential for profitability. First-generation immigrants are risk-takers with ambition above average. Convenience stores are profitable ventures, which may result in opportunities to open multiple locations, increasing potential profits. Immigrants who fear they can’t compete in the job market might find store ownership appealing. Many visas for foreigners require either a job or investment in the economy. Owning a store may satisfy visa requirements while providing ongoing income. Asians typically have lower overhead costs than other business owners. They often live in populated areas with plenty of customers who want convenience. Additionally, they usually don’t need to hire many employees since they do much work themselves, keeping costs down and helping these businesses stay profitable. In Japan’s capital city of Tokyo alone, there are 7,000 konbini convenience stores out of the country’s 50,000 total.
The Case of Indian-Owned Stores
Why do so many Indian people own convenience stores? It’s because they started buying them a long time ago, using family to help family do so. These stations and convenience stores are generally in high traffic areas, generating a good bit of income compared to the cost of acquiring them. Besides, owners often work 12-18 hours per day/7 days a week and have to save up for years prior to owning a business, a work ethic not as common in American culture. Profits from the first store are reinvested into a second one, where a relative might work to ensure employees do not swindle funds.
According to Tariq Khan, over 50 percent of 7-Eleven stores are owned by South Asians. In California alone, at least 600-700 out of 1,200 7-Eleven stores are owned by South Asians. "I had to get used to this whole business and I didn’t have any experience," says Speedy Mart’s Bipin Patel.
In the United States, convenience stores, numbering 153,237, form a lifeline for daily life. However, Indian Americans working in convenience stores have encountered tragic events in the past few years. “We often advise the community to be safe and work in good neighborhoods with the correct permits and documentation in place,” says Parmesh Bheemreddy.
The average gross profit margin for convenience stores is $450,000, with potential profits increasing by opening other locations. Over 100,000 gas station/convenience stores across the country bring in over $400 billion in revenue each year.
Why do foreigners own liquor stores? Liquor shops, in high demand year-round, offer several advantages. They can make their businesses more flexible, choosing to specialize in various types of alcoholic beverages. During the COVID-19 pandemic, liquor stores were deemed “essential” in many places due to the potential withdrawal consequences for addicts.
In California, liquor stores, along with grocery stores, drugstores, and convenience stores, can all sell wine, beer, and spirits. Every state has specific laws regarding alcohol sales, with the minimum legal drinking age set at 21.
Some states have state liquor stores, an outcome of lobbying by temperance groups. In Denver, liquor stores were not initially essential, but they were allowed to remain open with social distancing implemented. Running a liquor store can be profitable in the long-term if managed properly.
Unlike grocery stores, well-curated liquor stores create an inviting atmosphere for connoisseurs. Supporting local liquor stores means supporting small businesses and the passionate individuals behind them. However, according to Forbes, liquor stores are among the least profitable businesses at 1.7% profit. Buyers interested in purchasing a liquor store should study the current owner’s success and focus on effective inventory control.