Profile: Domino's Pizza Inc (DPZ.N)

DPZ.N on New York Stock Exchange

87.68USD
24 Oct 2014
Price Change (% chg)

$0.38 (+0.44%)
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Volume
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Domino’s Pizza, Inc. (Domino’s) is a pizza delivery company in the United States. As of January 1, 2012, it operated through a network of 9,742 Company-owned and franchise stores, located in all 50 states and in more than 70 international markets. In addition, it operates 16 regional dough manufacturing and supply chain centers, one equipment and supply facility, one thin crust manufacturing center and one vegetable processing center in the contiguous United States, and six dough manufacturing and supply chain centers outside the contiguous United States. The Company operates its business in three segments: domestic stores, domestic supply chain and international. As of January 1, 2012, the domestic stores segment was consisted of 4,513 franchise stores and 394 Company-owned stores. Its domestic supply chain segment, which manufactures its dough and thin crust products, processes vegetables and distributes food, equipment and supplies to all of its Company-owned stores and over 99% of its domestic franchise stores. As of January 1, 2012, its international segment was consisted of 4,835 franchise stores outside the contiguous United States. It also manufactures dough and distributes food and supplies in a limited number of these markets.

The Company’s menu has three choices for pizza products: pizza type, pizza size and pizza toppings. Its stores carry two or three sizes of Traditional Hand-Tossed, Pan, Brooklyn Style and Crunchy Thin Crust pizza. Its typical store also offers Domino’s Artisan pizzas, Domino’s American Legends pizzas, Domino’s Oven Baked Sandwiches, Domino’s Bread Bowl Pasta, boneless chicken and wings, bread sticks, Cinna Stix, Chocolate Lava Crunch Cakes, new Stuffed Cheesy Bread and Coca-Cola soft drink products. It also offers other products on a promotional or a regional basis, such as salads.

The Company’s computerized management information systems are designed to improve operating efficiencies, provide corporate management with access to financial and marketing data. Domino’s PULSE features include touch screen ordering, which ensures accuracy and facilitates order taking; a delivery driver routing system; administrative and reporting capabilities, which enable store managers to focus on store operations and customer satisfaction, and online ordering capability, including Pizza Tracker and Pizza Builder.

Domestic stores

During the fiscal year ended January 1, 2012 (fiscal 2011), the Company’s domestic stores segment accounted nearly 32% of its consolidated revenues. Nine of its domestic franchisees operate more than 50 stores, including its domestic franchisee who operates 136 stores. Its sources of revenues from domestic store operations are Company-owned store sales and royalty payments based on retail sales by its franchisees. In addition to generating revenues and earnings, it uses its domestic Company-owned stores as test sites for new products and promotions, as well as store operational improvements and as forums for training new store managers and prospective franchisees.

The Company’s domestic Company-owned store operations are divided into 10areas located throughout the contiguous United States while its domestic franchise operations are divided into fits regions. It provides direct supervision over its domestic Company-owned stores; provide training, store operational audits and marketing services and provide financial analysis and store development services to its franchisees.

Domestic supply chain

During fiscal 2011, the Company’s domestic supply chain segment accounted for 56% of its consolidated revenues. Its domestic supply chain segment is comprised of 16 regional dough manufacturing and supply chain centers that manufacture fresh dough on a daily basis and purchase, receive, store and deliver pizza-related food products and other complementary items to all of its Company-owned stores and over 99% of its domestic franchise stores. Each regional dough manufacturing and supply chain center serves approximately 300 stores, generally located within a one-day delivery radius. It supplies nearly 5,000 stores with supplies and ingredients, of which, nine product groups account for over 90% of the volume. During fiscal 2011, its domestic supply chain segment made approximately 515,000 full-service deliveries or approximately two deliveries per store, per week; and it produced over 304 million pounds of dough.

In addition, the Company’s domestic supply chain segment offers a profit-sharing arrangement to stores, which purchase all of their food from its domestic dough manufacturing and supply chain centers. The information systems used by its domestic dough manufacturing and supply chain centers are an integral part of the service it provides its stores. It uses routing strategies and software to optimize its daily delivery schedules. Its supply chain center drivers unload food and supplies and stock store shelves during non-peak store hits, which minimize disruptions in store operations.

International

During fiscal 2011, the Company’s international segment accounted 12% of its consolidated revenues. As of January 1, 2012, it had 4,835 international franchise stores. The principal sources of revenues from its international operations are royalty payments generated by retail sales from franchise stores and sales of food and supplies to franchisees in certain markets. During fiscal 2011, it had 413 net international store openings, including 75 net stores in India, 58 net stores in Turkey and 54 net stores in the United Kingdom. Its international stores are operated under master franchise agreements. As of January 1, 2012, its 4,513 domestic franchise stores were owned and operated by its 1,077 domestic franchisees.

The Company competes with Pizza Hut, Papa John’s and Little Caesars Pizza.

Company Address

Domino's Pizza Inc

30 Frank Lloyd Wright Drive
ANN ARBOR   MI   48106
P: +1302.6587581
F: +1302.6555049

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