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Entrepreneurs place bet on pizza franchise
On May 31, two enterprising young, local businessmen—Daniel Fakoory and Omar Hadeed—signed a deal that allowed them to assume the local ownership of the Domino’s Pizza franchise which currently has three locations: Diego Martin, Ariapita Avenue and Chaguanas.
The new owners of the franchise say that Domino’s, one of the most successful international franchises in the world, has struggled to replicate that same success here in Trinidad, but that’s about to change.
Domino’s is a large American pizza restaurant that was founded in 1960 and generated 2016 revenue of US$2.47 billion and profit of US$214.7 million, which was down 30 per cent from 2015.
The shares of the fast-food restaurant chain declined by 7 per cent between the end of April and June 9, according to an article on the Mottley Fool’s website.
“Although sales rose on an annual basis, they missed the analyst consensus, and even worse, earnings similarly fell short of expectations,” according to Mottley Fool, which attributed the company’s performance to rising competition, both within the pizza space and the fast food world in general, and rising labour costs in its main market, the United States.
The new owners have big plans for the franchise. “Being current owners of another successful franchise, Pita Pit, we know that the model works. When a franchise fails to work, more times than not, it’s because of ownership. You need to be involved, carefully manage every aspect of the business to ensure each customer gets what they expect,’’ Fakoory explained.
Acknowledging that labour and forex shortages are major issues in Trinidad, causing some other franchises to close their doors, the duo believes that all problems have a solution and they are intent on making Domino’s a fun place where employees will want to work.
Hadeed also explained, “The franchisor is also very committed to our success and has been making accommodations for us, understanding the shortage of US dollar currency. We expect to rely heavily on their support to further guarantee the success of the brand here in Trinidad.”
Questioned on why would they take over another franchise, which will drain T&T’s foreign exchange, when they had the opportunity to establish their own brand and retain more of the value locally, the business partners said: “The reason we chose to take over another franchise was exactly that, because it was a franchise. We choose to follow models that have proven to be successful internationally and adapt them here to our local market.
“From a businessman’s point of view, the opportunity to buy into a franchise like Domino’s with support second to none, far outweighs the opportunity to develop our own brand and expose ourselves to that learning curve and risk.
“Furthermore, what made the Domino’s acquisition attractive to us was that we inherited an ongoing business with three stores already in operations, if we had to set up these stores from scratch we would not have been interested.”
Forex shortage’s not an issue
They also said that the lack of foreign exchange on the local market was not going to prevent them from grabbing the opportunity, especially as “the franchisor is prepared to work with us through these challenges.”
Asked which ingredients would the new Domino’s franchise import directly from the franchisor and which ingredients would be sourced locally, the entrepreneurs said: “In 2009/2010 Domino’s did a complete overhaul of their products and the ingredients that make up these products.
“Since that time, the franchise is very firm about buying from their approved supply chain. This will ensure consistency with product quality throughout the franchise network.
“Therefore, we intend to adhere to these policies and purchase the proprietary ingredients that are responsible for the taste of the pizza from Domino’s recommended supply chain, items such as the premix for the dough, pizza sauces, cheeses and meats. Other ingredients that are standard in taste can be sourced locally, mainly the vegetables, such as mushrooms, pineapple, sweet peppers, onions and so forth.”
The way forward
When asked what can customers expect to see differently from Domino’s, the duo listed some of their immediate focus points for improvement:
• Improved customer service is top of mind, with further training of staff being necessary to ensure the level of service expected by Domino’s International is received.
• Faster and more reliable delivery with further investments to increase their delivery fleet with more delivery specialist to ensure drivers are always on standby ready to deliver.
• Ensuring product quality by importing through the Domino’s approved supply chain ONLY, instead of using substitutes. We are 100 per cent committed to this. We will ensure that when you taste our pizza, it will be the very same taste as any other Domino’s pizza worldwide. This is of paramount importance to us. Expect new recipes and ingredients being used in every pizza to ensure high quality and great tasting products.
• Great value deals, we are known internationally and locally for our Two for One Tuesday specials, we are looking to build upon value combos like this and possibly add other promotions to the lineup as we continue to search for additional locations nationwide to eventually serve the entire nation.
• Ensuring product availability, Domino’s has a very robust network of suppliers, to ensure their franchisees always have access to stock. When substitute suppliers usually run low on certain stock, Domino’s supply chain always has, which is yet again another benefit of sticking with their supply chain.
• Expanding our menu by introducing new items such as pastas, salads etc. These new items are very popular internationally, as it gives much needed variety to the menu.
• Renovation of existing stores to the new pizza theatre look as well as expansion to strategic locations nationwide.
Domino’s pizza has over 14,000 locations worldwide and has been the fastest growing pizza franchise over the last decade. A lot of their success came from their complete overhaul of the product in 2010, as well as investments in technology, which has left the competition in the dust. Domino’s online ordering platform makes ordering a pizza from your phone, tablet or computer, so easy and fun. The technology behind their online platform has won awards internationally and has been recognised as the best in the market.
The question of when online ordering would be made available to customers here in Trinidad, both smirked and exclaimed, “It’s already on the way, standby!’’
Fakoory added, “Going forward, customers can expect to get a top quality, great tasting pizza when they order from Domino’s, and further, they can expect to get this pizza delivered to them faster than anyone else. We are known internationally as the pizza delivery experts and now it’s about time for Trinidad to know why. ‘’