Top 100 Detailed Analysis

Domino's Germany: Sales bought

Domino's Pizza drivers: Since 2015 they can be seen (again) on Germany's roads.
IMAGO/Ralph Peters
Domino's Pizza drivers: Since 2015 they can be seen (again) on Germany's roads.

Gretel Weiß, editor of foodservice, annually compiles the Top 100 ranking of the top-selling gastro players/brands in Germany. In this detailed analysis, she looks at Domino's and the development of the US brand in this country. In the Corona year 2020, the pizza delivery service managed a revenue increase of 55 million euros - the best growth value (ahead of Call a Pizza and Smiley's) in the complete Top 100 ranking.

Domino's Germany generated €290.0 million in revenue in 2020 with 345 stores at the end of the year. In other words, 23.4% revenue growth with 6.5% network compression. The franchise organization is majority-owned by Domino's Pizza Enterprises Limited, based in Australia. As the largest licensee of the delivery service world market leader, Domino's Pizza Enterprises operates in the markets of Australia, New Zealand, Japan and Central Europe (France, Benelux, Germany, Denmark). Annual sales over 3 billion Australian dollars with more than 2,600 stores across the Pacific and our continent.

As a global brand, Domino's Pizza 2020 represents more than $16 billion in system sales at more than 17,600 units. Like Starbucks and Panera Bread, the system has been one of the restaurant frontrunners of digitization - for nearly a decade.

In 1985, Domino's, like Call a Pizza, was one of the delivery service pioneers in the FRG. Before 2015, a total of three unsuccessful market entries in this country - until the buy principle was practiced with the purchase of Joey's. The goal: quickly achieve high market penetration. Goal: high market penetration quickly. By the way: Germany is still considered a country with large potential reserves in 2021 (even without Corona!). We look at the development since the middle of the last decade.

2015

At the end of the year, surprise sale of Joey's Pizza Service, the number 1 in the German delivery market (143.5 million euros in revenues from 212 stores) to Domino's, the global market leader in this discipline. A 79 million euro deal. The acquisition is being made by two major listed franchises, led by Domino's Australia, the system's largest licensee with almost 2,000 units. It is the brand's fourth attempt to conquer Germany.

In France and Holland, the makers from the other side of the world have already shown that they can also do Europe. Namely, sensitively fitted into the psyche, i.e. the taste preferences of the respective nation. In addition, incredibly fit and powerful in the digital business. It's about potentials that are still underused in our country - compared to Anglo-Saxon countries.

2016

Soon the Joey's brand, sent on its way by Carsten Gerlach in 1988, will be mothballed. "It's bitter," he says himself. But rebranding is an absolute must after the deal. How management takes customers and franchise partners along for the ride will determine success in the years ahead. They know that. Because people love their Joey's pizza and need to be motivated, even embraced, to transfer their affection to Domino's. Millions are one thing, emotion is another.

It is wise of Domino's, at least for the time being, not to touch the recipes of the Joey's classics, not to simply take the beloved taste away from the regular customers. After all, they are sworn to the uniqueness of 'their' brand.

The top 4 pizza delivery brands together generated €350.2 million in net sales at 543 units at the end of 2016. Of this, Domino' s alone accounted for 152.6 million euros in revenue and 214 units. They are followed by Hallo Pizza, Smiley's and Call a Pizza. The top 4 have increased their revenues by a good 130% in 10 years with just under 50% network compression. Pure dynamism. No other submarket can show such positive figures as these specialists.

Mind you: service providers/platforms from outside the industry, such as Deliveroo and foodora, demand business for themselves and a really large percentage of the value-added volume. This is how dynamic value creation networks with new rules of the gameare created.

2017

A year of consolidation, manageable failure rate among Joey's franchise partners. Then at the end of 2017: the next acquisition. Now Hallo Pizza, the number 2 in the domestic delivery market. The brand, founded in 1990 by Axel Fassbach, has a good 160 units and generates annual revenues of just over 80 million euros. Purchase price: 32 million euros. Domino's states 1,000 storesas expansion target for Germany!

Delivery services viewed asa service cater to the growing convenience of consumers. They are among those hospitality providers that are fully benefiting from the internet revolution. This shows how strongly smartphones and tablets have long since organized and controlled the everyday consumption of millions of people. Delivery of assortments that tend to be borderless is considered the growth path par excellence globally in 2017+.

2018

The Hallo Pizza acquisition brings a sales boost of over 40% with 60% net expansion. Integration and rebranding again. Company reports total revenue of €220.0 million this year - up 43.8%. Delivery network grows to 333 units (322 of which are operated by franchisees). Domino's is now the undisputed delivery market leader in Germany and the only global brand in this discipline. The competition, led by Call a Pizza (€64.8m/104 units) and Smiley's (€63.3m revenues from 62 stores), is regional and national across the board. With burgerme for the first time a non-pizza delivery system in the ranking of the Top 100.

2019

Domino's Pizza presents itself with a slightly smaller network, the integration of the Hallo Pizza brand is fully completed. 6.9% sales increase for the delivery service in a best year ever for professional restaurants in this country. Total revenue of €235.0 million at the interface with the consumer. With 328 units in the annual average, an average turnover per unit of 714,000 euros. In comparison: Call a Pizza 680,000 euros and Smiley's 1.130 million euros. By the way: The Hanseatic city of Hamburg can call itself Germany's delivery capital. Domino's has almost 50 units here.

2020

Tailwind for the delivery business by Corona. 55.0 million euros more revenue than 2019 - the record growth size in the ranking of Germany's top 100 restaurateurs. "We were allowed to experience that it is a privilege to be open," says Domino's CEO Stoffel Thijs. The average turnover per store rises to over 900,000 euros - the franchisees earn really good money!

As an aside, Domino's UK is quoting revenues of £1.348 billion for 2020, with an average of 1,278 stores. That works out to GBP 1.055 million per unit. Kraft Corona, Domino's has far exceeded its original 2020 targets in many countries around the world. For example, revenue from existing space in Germany has increased by around 20%, and in the UK by over 10%.

2021

The latest development makes people want to expand. Domino's Germany wants to bring at least 45 more units online in 2021. More are welcome. The planned turnover for 2021 defined at the beginning of the year is 324 million euros. Guideline for the current year: focus on optimizing delivery areas and improving operational processes.

Man has plenty of tailwinds - in product, in consumer demand, in supply of locations, franchise partners, managers and employees. Contactless delivery is Corona-ready.

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