Joel Libava
In this post, I’m going to cover Domino’s franchise cost, a brief history of this huge pizza brand, and a sad story about delivering pizzas “in 30 minutes or less.”
Domino’s Pizza Franchise: The Numbers
Did you know that the Domino’s Pizza franchise is one of the largest pizza franchise businesses in the world? Check this out.
Domino’s (as of the second quarter of 2018), operated a network of more than 15,000 franchised* and company-owned stores in the United States and over 85 international markets.
*In the United States, 93% of Domino’s are franchises.
Additionally, 90% of the Domino’s Pizza franchise owners started their careers as pizza makers and/or delivery drivers etc.
And speaking of Domino’s Pizza owners, if you buy a Domino’s franchise, you’ll be provided with in-store and classroom training that’s focused on owning operating your franchise smoothly and profitably. That’s part of the cost of a Domino’s business.
Finally, and this is big, Domino’s stores sell 3 million pizzas a day.
Want in?
If so, here’s how much it will cost you to open a Domino’s Pizza franchise business in your local area.
Domino’s Franchise Cost
Here are the initial startup costs of a Domino’s business.
- Initial Investment: $119,950 to $461,700
- Liquid Cash Requirement: $75,000
- Franchise Fee: $25,000
- Royalty Fee: 5.5%
- Ad Fund: 3%+
Additionally, franchise owners cannot go below 51% ownership and they must oversee store operations personally.
Domino’s Pizza Franchises: History And More
If owning a Domino’s franchise is something you’re interested in, it would behoove you to understand the company’s history. Check this out.
The Domino’s Pizza franchise empire began in 1960, when Tom and James Tom Monaghan purchased “DomiNick’s,” a pizza place in Ypsilanti, Michigan. By 1965, Tom was the sole owner and renamed the business “Domino’s Pizza.”
By 1967, Domino’s Pizza became a franchise business, and (interestingly enough) the first franchise location opened its doors in…Ypsilanti, Michigan.
- By 1983, Domino’s was on a major roll.
- The 1,000th Domino’s store opened
- Domino’s first international store opened in Winnipeg, Canada
- The company opened their first Australian location
- And to top things off (pun intended) by 1995, Domino’s was the fastest-growing pizza company in the U.S.
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(Domino’s delivery vehicle image courtesy of Wikimedia)
Domino’s Is An International Franchisor
One of the things that make this historic pizza franchise stand out is its massive international footprint.
To prove my point, take a look at this video showing the Domino’s Pizza toppings offered around the world, by popularity.
A Pizza Delivery Business Glitch: An Unfortunate Part Of Domino’s Pizza History
Without exception, fast-growing companies experience problems.
That said, sometimes these problems are larger than life-literally, as was the case with Domino’s, way back in 1973. Here’s what happened.
In a surprising move, Domino’s decided to offer a “30 minutes or it’s free” pizza delivery guarantee.
Specifically, if the Domino’s pizza delivery driver didn’t deliver your pizza to your home in 30 minutes or less (after ordering), your pizza would be free. I wonder how Domino’s Pizza owners felt about that promotion?
To be sure, the guarantee did help the Domino’s Pizza brand get known for it’s fast delivery. But it wasn’t without consequences.
Domino’s Pizza: 30 Minutes Or Less True Story
In 1992, an Indiana woman was killed by a speeding Domino’s delivery driver, and her family sued Domino’s. Domino’s lost the suit, and ended up paying the family $2.8 million.
Following that, a woman who was injured when a Domino’s delivery driver ran a red light and collided with her vehicle. She sued Domino’s in 1993, and was awarded almost $80 million (she ended up accepting $15 million). The end result? The “30 minutes or it’s free” guarantee was dropped.
They’re Still Delivering Pizza!
Even with the horrible things that happened, the team at Domino’s headquarters made the decision to remain in the pizza delivery business, but not with a “30 minutes or less” guarantee. In other words, they’re just more careful about how they go about doing it. And of course, how they word their guarantees, which I’m sure helps Domino’s Pizza owners sleep better at night.
(Pizza image from Wikimedia)
Next, I’m going to talk about earnings.
How Much Money Can You Make As A Domino’s Franchisee?
Your income as a Domino’s Pizza franchisee depends on your:
- Revenue
- Expenses
- Time in business
- Local market
- Location
And while that may not be the answer you’re looking for, until you receive the Franchise Disclosure Document, and talk with several existing franchisees, you won’t be able to find out how much they’re making. Only then can you make some projections on how much you can make as a Domino’s franchise owner.
Important: if you run across any articles about Domino’s pizza franchises that give you franchisee earnings information, ignore the numbers. Why?
Because unless there’s verified proof of individual franchisee income, documents or, heck, a recorded conversation between a Domino’s franchisee and the article writer, you got nothing.
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Franchising News Updates
Domino’s Could Win Big In 2023
According to Peter Saleh, an analyst for brokerage house BTIG, “The pizza giant could very well enter 2023 with its highest level of pricing in more than a decade.” Saleh expects Domino’s to take price on its $7.99 carryout offering, which would bump sales and margins across the coming year. Improvements in fundamentals would then ‘translate into a resurgence in development in 2024.”‘
Domino’s Helps Local Restaurants
Participating Domino’s stores across the Greater Boston, Phoenix, Louisville, Laredo and Denver areas…bought thousands of $50 gift cards from local restaurants, randomly gave them out to Domino’s delivery customers, and encouraged them to use the gift cards by ordering directly from the local restaurants so they could avoid delivery app fees. These local Domino’s stores gave away more than $100,000 worth of gift cards from locally owned grills, taco places, barbeque joints, bakeries, delis and more, to roughly 2,600 customers throughout early November.
Domino’s Theater Concept
Domino’s franchising has come up with a new store design for franchise owners, and it’s sharp. Look:
All in all, Domino’s looks like it will continue dominating the delivery side of pizza.
In conclusion, if you’re thinking of owning a pizza business, and brand recognition is a major part of why you want to get into the business, Domino’s certainly has it. Plus, pizza is popular, and will remain so for years to come.
So, do you think a Domino’s franchise is right for you? Do you want to own a Domino’s Pizza franchise? Can you afford the cost of a Domino’s?
My Opinion Of The Domino’s Pizza Franchise Business
This pizza franchise is worth a look. Because:
1. Domino’s branding is off-the-charts.
2. This franchise dominates pizza delivery-which makes their franchise owners happy.
That said, if you’re thinking of becoming the owner of a Domino’s, I suggest buying 3 or more units, so you can make a serious go of this franchise business opportunity.
In addition, having a food-service background will help a lot, as the food is fast-paced, and can be difficult to staff and run at times.
FAQ’s About Domino’s
The initial investment ranges from $119,950 to $461,700.
Domino’s sells around 3 million pizzas a day.
Domino’s is one of the largest pizza franchise businesses in the world, with 15,000 franchised and company-owned stores around the world.
Domino’s opened their first franchise in 1967, in Ypsilanti, Michigan.
If the Domino’s pizza delivery driver didn’t deliver your pizza to your home in 30 minutes or less (after ordering), your pizza would be free.
(Domino’s franchise business image courtesy of Wikimedia)
