Domino's ready for full-size store move

Domino's Pizza has claimed that the reason why it scrapped its experimental shops within petrol stations and convenience stores was because business was too good for the small shops to cope.

Over the past five years, the firm has opened 15 pilot take-aways split between Alldays convenience stores and Total petrol stations. "At the time, we thought the population of the area would not support a full Domino's site," said chief executive Stephen Hemsley.

But the smaller stores, typically 400sq ft against the average 1,600 sq ft, attracted more take-away or home-delivery orders than they could handle, so Domino's is now replacing them with full-size stores.

According to the company's financial results for 2000, it closed down the last four Alldays concessions and two of the last three Total sites last year.

Domino's sees scope for 1,000 pizza delivery stores in the UK within 10 to 15 years, with annual sales topping £500m, and is seeking new franchisees to help it open the 50 to 100 stores needed each year to reach this target.

Domino's opened 22 new sites last year, to end with 215 stores in the UK and Ireland, 31 of them owned and operated by the company. It also bought American Pizza Company, which ran eight Domino's franchises in Surrey and Berkshire, for £1.85m in cash.

System sales in the UK and Ireland, which include sales by franchisees, grew by 19.9% to £76.1m and average weekly sales in stores increased by 3.1% to £7,075. Group turnover from royalties, fees on new store openings, food sales and rental income climbed by 27% to £32.5m.

Pre-tax profit soared by 61.8% to £2.2m, or by 18.5% after adjustments for exceptional charges incurred in 1999. Internet orders now account for 4% of sales, or £300,000 a month.

Domino's last year opened an Irish commissary and distribution centre near Dublin. It said the cost of ferrying over food to its Irish sites had reduced 2000 pre-tax earnings by £200,000.

by Angela Frewin