Popular pizza chain opens 700 new locations to compete with McDonald’s
A family favorite pizza chain is expected to open 700 new locations, including 70 before the end of the year as part of major expansion plans.
Domino’s, which currently operates 1,300 branches in Britain and Ireland, has set its sights on running 2,000 stores by 2033.
The pizza restaurant said it expects to open 70 new branches by 2024, although it hasn’t said where they will be, so you’ll have to keep your eyes peeled.
The move to operating 2,000 stores in less than a decade could see the chain rival McDonald’s, which currently operates fewer than 1,400 restaurants in the UK and Ireland.
This obviously doesn’t take into account the number of stores McDonald’s could have by 2033.
Domino’s today announced its expansion plans in its 2023 annual results, with the brand’s sales totaling £1.57 billion.
The pizza chain said it aimed to generate a total turnover of £2.5 billion by 2033, after opening 61 new stores in 2023.
Commenting on today’s results, Andrew Rennie, CEO said: “Last year we continued to make strong strategic progress with 61 new store openings, as we expanded our
customers compelling value.
“These efforts have resulted in increased revenue and shareholder returns, with continued robust earnings growth.”
He added: “In December I set out a framework for accelerating long-term sustainable growth.
“After a great year for store openings in 2023, we are accelerating our growth and expect to have 1,600 stores in Britain and Ireland delivering £2.0 billion in system sales by 2028, and 2,000 stores by 2033.”
Mr Rennie also said Domino’s had plans to launch a £4 meal deal and a customer loyalty scheme.
He said the lunch offering will be launched in the “next few weeks”, while the loyalty program will be unveiled later this year.
The CEO said: “It’s not so much about the competition, but we know we are under-penetrated in some areas.
“In other countries Domino’s does 20 to 25% of its sales at lunchtime, but here it’s only around 15%. That’s why we’re launching a £4 lunch deal and cheeky pizzas and wraps, because we know people want a lighter option. .”
Domino’s planned store expansion comes at a time when other pizza chains are struggling on the high street.
Papa John’s, which currently operates more than 520 locations in the UK, plans to close 50 “underperforming” restaurants.
Earlier this month, Papa John’s said it would “undertake a comprehensive review of our UK restaurants to assess viability.”
A spokesperson told The Sun that the “strategic” closure of failing branches would give the company the opportunity to invest in branches that are doing well.
Pizza Hut has also languished on the high street, with the owner of its UK stores Heart locked in negotiations with Smart Group to refinance millions of pounds of debt with lenders in August last year.
At the time, accountants warned Pricewaterhouse Coopers (PwC) that the company’s dining franchise arm faced “material uncertainty that could cast significant doubt on its… ability to continue as a going concern”.
In the year to December 2022, Pizza Hut’s revenues rose from £130 million to £161 million, but the additional costs pushed its pre-tax loss to £3.6 million.
The chain is also in the process of paying back £73 million of debt, of which £31 million is due by April 2024.
It comes after the chain announced in 2020 that it would close 29 branches after being rescued from bankruptcy.
Why are retailers closing their stores?
RETAILERS have been feeling the pressure since the pandemic, as shoppers cut back on spending due to the rising cost of living.
High energy costs and the move to online shopping after the pandemic are also taking their toll, with many high street stores struggling to continue.
The high street has seen a slew of closures in the past year, with more to come.
The number of jobs lost in UK retail fell last year, but 120,000 people still lost their jobs, figures show.
Figures from the Center for Retail Research show that 10,494 stores will have closed for the last time in 2023 and 119,405 jobs will have been lost in the sector.
It was fewer stores than had been lost in recent years, and a decrease from the 151,641 jobs lost in 2022.
The centre’s director, Professor Joshua Bamfield, said the improvement is “less bad” than good.
While some big names on the high street were lost, including Wilko, many major companies had already gone bankrupt before 2022, the center said, such as Topshop owner Arcadia, Jessops and Debenhams.
“The cost of living crisis, inflation and rise in interest rates have prompted many consumers to tighten their belts, causing retail spending to fall,” said Prof Bamfield.
“Retailers themselves have faced rising energy and occupancy costs, staff shortages and declining demand, making rebuilding profits after extensive store closures during the pandemic exceptionally difficult.”
Besides Wilko, which employed around 12,000 people when it went bust, the biggest failures of 2023 include UK Flooring Direct, Planet Organic and Tile Giant.
The Center for Retail Research said most stores were closed as companies tried to reorganize and cut costs rather than face bankruptcy.
However, experts have warned that more bankruptcies are likely this year as consumers tighten their belts and borrowing costs for businesses soar.
According to official figures, about 14% of bankruptcies last year occurred in retail businesses.
In other news, Domino’s launched a pasta-inspired lasagna and carbonara pizza in February.
But the change left some pizza lovers confused, with one saying: “Clearly Domino’s has declared war on Italy.”
The pizza chain also launched Cadbury Creme Egg-themed cookies nationwide last month.
But if you want to get your hands on one, you’ll have to be quick: they’re only on sale until April 8.
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