Specialist
Former Head at Domino’s Pizza UK & Ireland Ltd
Agenda
- Like-for-like outlook across Domino's Pizza Group's (LON: DOM) estate, highlighting consumption trends since lockdown, including around delivery, collection and through-the-day trade
- Restaurant expansion opportunities in the UK post-coronavirus across franchisees and corporate stores
- Franchise relationship improvement opportunities
- Operating cost outlook for Domino’s and the franchise network, highlighting pressure from food and labour costs
Questions
1.
Could you use Domino’s’ H1 numbers to explain current trading and how it relates to the health of the company’s system sales?
2.
How do you expect Q4 to trend after the Q3 results, which I believe were also relatively positive? What about for the full year?
3.
Domino’s breaks down collection and delivery. How do you think these segments or driver numbers might trend?
4.
How confident are you in Domino’s’ capabilities for improving the collections business?
5.
Do you think lower prices in collection erode the pricing power in delivery? How does it work?
6.
How incremental is the collections business, given it shouldn’t impact the plc if it isn’t cannibalising delivery sales?
7.
What sort of pricing change do you think is needed at Domino’s?
8.
Why is Domino’s pursuing this high-low strategy rather than everyday low price?
9.
How long do you think Domino’s can continue increasing value through prices rather than volume?
10.
How easy is it for the plc to pass food cost increases onto the franchisees, which has previously been a point of dispute?
11.
What might be the pricing solution for Domino’s Pizza Group?
12.
What is the scope of Domino’s increasing its through-the-day offer, which could be collection or delivery, to increase system sales?
13.
Can the franchisees be profitable at GBP 4.99 or GBP 5.99 for the through-the-day offer?
14.
Domino’s quotes 200 new sites that could be opened, but could you explain the expansion opportunity in the UK?
15.
Could Domino’s limit the larger franchisees taking on these new sites?
16.
To what extent do the 200 new stores reduce franchisee dependency and how material would that be for the plc?
17.
Domino’s is now increasing its incentives for franchisees to open new stores. How could it accelerate its expansion programme?
18.
How common is it in franchising QSR to offer GBP 100,000-150,000 incentives for franchisees to open new stores, especially with relatively low performance targets?
19.
Why isn’t Domino’s opening corporate stores instead of franchises?
20.
How might Domino’s approach directly operated or corporate sites?
21.
Do you think Domino’s Pizza Group will bring the US model of buying, improving and selling to the UK?
22.
How could current food price inflation impact supply chain EBITDA contribution at the plc level?
23.
Will Domino’s absorb some of the food cost inflation or can it transfer it entirely to franchisees?
24.
What is the potential for further optimising costs through the supply chain to maintain, or even improve, the EBITDA contribution?
25.
Franchisees experience additional strain around the labour shortage, labour inflation, driver shortage and potentially last-mile delivery driver shortage. How might this impact the relationships between Domino’s, the plc and its franchisees?
26.
Do you think the incentive increases for store openings make the deal more attractive for franchisees? How do improvements in the supply chain’s capability and plc’s digitalisation further entice franchisees?
27.
Why have the franchisees not yet signed the new deal?
28.
What is the food cost solution if Domino’s is expecting lower profitability at the plc level?
29.
How optimised is franchisee P&L? Can operating margins outside of food costs improve?
30.
Is there evidence to suggest relationships are improving under Domino’s plc’s new leadership, including the new CEO?
