DOMINO’S PIZZA INC.

, 2013
CASE STUDY

I. INTRODUCTION:

Domino’s is the largest pizza delivery company in the USA having a 22.5 percent share of the pizza delivery
market. Domino’s digital ordering channels include online ordering at www.dominos.com, mobile
ordering at http://mobile.dominos.com, and ordering on iPhone, Kindle Fire, and Android apps. More
than $2 billion of Domino’s pizza is ordered online annually. There are more than 10,300 Domino’s stores
in over 70 countries.

II. MISSION & VISION STATEMENT:

Mission Statement: “Exceptional franchisees and team members on a mission to be the best pizza delivery
company in the world.

Vision Statement: No Vision Statement.

Mission Statement (Proposed): We aspire to achieve highest standards of the international chain of pizza
delivery with motivated people providing exceptional experience of oven-hot pizzas with excellent
customer service. We are accountable for profitability in everything we do, providing our shareholders
with value growth. We strive to act with honesty, openness, fairness and integrity

Vision Statement (Proposed): To be the best and well-known oven-hot pizza delivery company in the
world with smart hustle, positive energy and offering a sincere customer service.

III. INTERNAL AUDIT

Organizational Structure:

As seen, Domino’s has 11 top executives, mostly executive vice-presidents (EVPs). It appears that
Domino’s operates from a functional organizational structure with Doyle being “where the buck stops,”
although for a firm of this size, a divisional or strategic business unit type structure by region (or by
franchised versus company owned) may be more effective in promoting delegation of authority,
responsibility, and accountability. However, Domino’s has a CEO directly reporting to the Chairman. This
allows the CEO to focus completely on operations, and organizational issues in strategy execution. Also,
eliminates conflicts in the areas of performance evaluation, and recruitment of new senior staff and other
directors.

Financial Analysis:

Company Worth Analysis

Stockholders' Equity $1,335,523

Net Income x 5 $561,960
(Share Price/EPS) x Net Income $2,559,713
Number of Shares Outstanding x Share Price $2,567
Method Average $1,114,941
(as of 2012)

Strengths: Weaknesses:
1. Extensive Network across the Globe 1. Decreasing sales in mature markets
2. Efficient Supply Chain 2. Lesser number of eateries
3. Strong and Proven Business Model 3. Franchisee related issues - Operational
4. Fast Delivery Service difficulties
5. Customer Satisfaction 4. Less Variety in Menu - Pizza Sales only
6. Low Cost Alternative 5. Small Sized Outlets - Not suitable for Corporate
7. Increasing International Sales Lunches or Birthday Parties
8. Strong Brand Image 6. Need more investment in new technologies
7. Functional Organizational Structure

IFE MATRIX:
Internal Factor Evaluation Matrix (IFE)
Strengths Weight Rating Weighted Score
1 Extensive Network across the Globe 0.10 4 0.40
2 Efficient Supply Chain 0.15 4 0.60
3 Strong and Proven Business Model 0.05 3 0.15
4 Fast Delivery Service 0.05 3 0.15
5 Customer Satisfaction 0.05 3 0.15
6 Low Cost Alternative 0.06 3 0.18
7 Increasing International Sales 0.05 3 0.15
8 Strong Brand Image 0.10 3 0.30

Weaknesses Weight Rating Weighted Score

1 Decreasing sales in mature markets 0.09 1 0.09
2 Lesser number of eateries 0.05 2 0.10
3 Franchisee related issues - Operational difficulties 0.03 2 0.06
4 Less Variety in Menu - Pizza Sales only 0.05 2 0.10
5 Small Sized Outlets - Not suitable for Corporate Lunches or
0.05 1 0.05
Birthday Parties
6 Need more investment in new technologies 0.08 1 0.08
7 Functional Organizational Structure 0.04 1 0.04
TOTALS 1.00 2.60
 IV. EXTERNAL AUDIT

Opportunities: Threats:
1. Market Expansion 1. Intensive Competition from Rivals (e.g.
2. Penetration Pizza Hut, Little Caesars, Papa John's)
3. Bigger Outlets 2. Competition from local mom-and-pop
4. Improve Efficiency in online and mobile brands
orders 3. Changing Consumer Eating habits
5. Health conscious eatables: Low calorie 4. Increasing cost of delivery (Fuel etc.)
menu 5. Pizza Hut generated 60% more revenues
6. Region Specific Toppings in 2010
7. Introduce other menu items e.g. Pasta, 6. Increasing concern about CSR
Salads etc.

EFE Matrix:

External Factor Evaluation Matrix (EFE)

Opportunities Weight Rating Weighted Score
1. Market Expansion 0.08 3 0.24
2. Penetration 0.08 3 0.24
3. Bigger Outlets 0.05 2 0.10
4. Improve Efficiency in online and mobile orders 0.08 3 0.24
5. Health conscious eatables: Low calorie menu 0.12 1 0.12
6. Region Specific Toppings 0.08 3 0.24
7. Introduce other menu items e.g. Pasta, Salads etc. 0.10 1 0.10

Threats Weight Rating Weighted Score

1. Intensive Competition from Rivals (e.g. Pizza Hut, Little Caesars,
0.10 2 0.20
Papa John's)
2. Competition from local mom-and-pop brands 0.08 3 0.24
3. Changing Consumer Eating habits 0.10 2 0.20
4. Increasing cost of delivery (Fuel etc.) 0.03 3 0.09
5. Pizza Hut generated 60% more revenues in 2010 0.04 2 0.08
6. Increasing concern about CSR 0.06 1 0.06
TOTALS 1.00 2.15

CPM Matrix:
Competitive Profile Matrix (CPM)
Domino's Pizza Hut Papa John's
Critical Success Factors Weight Rating Score Rating Score Rating Score
Advertising 0.09 3 0.27 3 0.27 2 0.18
Market Penetration 0.15 3 0.45 4 0.60 3 0.45
Customer Service 0.10 3 0.30 3 0.30 3 0.30
Store Locations 0.10 3 0.30 4 0.40 2 0.20
Employee Dedication 0.04 2 0.08 2 0.08 2 0.08
Financial Profit 0.08 3 0.24 3 0.24 2 0.16
Customer Loyalty 0.08 3 0.24 3 0.24 3 0.24
Market Share 0.12 4 0.48 4 0.48 3 0.36
Product Quality 0.08 3 0.24 3 0.24 3 0.24
Top Management 0.08 2 0.16 2 0.16 2 0.16
Price Competitiveness 0.08 3 0.24 3 0.24 3 0.24
0 0.00 0 0.00 0 0.00 0 0.00
Totals 1.00 3.00 3.25 2.61

SWOT Matrix:

SO Strategies WO Strategies

1. Increase the number of stores in the less 1. Increase healthy food items in menu to
penetrated markets (S7, S8, O2) increase sales in mature market (W1, O5)

2. Use its technological capabilities to better 2. Use its internal supply chain capabilities to
serve the customers (S5, O4) sort out any operational issues faced by the
franchisees (W3, O4)
3. Increase Variety in Menu - Pasts, Salads etc.
(W4, O7)

ST Strategies WT Strategies

1. Focus on marketing and advertising its 1. Increasing the number of stores

products and brand to reduce competitive internationally (W1, T1, T2)
pressure (S6, S8, T1, T2)
2. Increase healthy food items in menu to
2. Deeply penetrate the huge market of China increase sales in mature market (W1, T3)
(S6, S7 S8, T1, T2) 3. Increase the store size (W5, T5)

IE Matrix:
 The Total IFE Weighted Scores
Strong Average Weak
4.0 to 3.0 2.99 to 2.0 1.99 to 1.0
4.0 I II III

High

3.0 IV V VI
The
EFE
Total Medium
Weighted
Scores
DOMINO'S PIZZA

2.0 VII VIII IX

Low

1.0

SPACE Matrix:
Internal Analysis: External Analysis:
Financial Position (FP) Stability Position (SP)
Return on Investment (ROI) 4 Rate of Inflation -5
Leverage 2 Technological Changes -4
Liquidity 3 Price Elasticity of Demand -3
Working Capital 4 Competitive Pressure -4
Cash Flow 5 Barriers to Entry into Market -6

Financial Position (FP) Average 3.6 Stability Position (SP) Average -4.4

Internal Analysis: External Analysis:

Competitive Position (CP) Industry Position (IP)
Market Share -2 Growth Potential 6
Product Quality -3 Financial Stability 4
Customer Loyalty -3 Ease of Entry into Market 6
Technological know-how -4 Resource Utilization 5
Control over Suppliers and Distributors -1 Profit Potential 4

Competitive Position (CP) Average -2.6 Industry Position (IP) Average 5.0

X-axis 2.4
Y-axis -0.8
 FP
Conservative Aggressive
7

CP IP
-7 -6 -5 -4 -3 -2 -1 1 2 3 4 5 6 7
-1

-2

-3

-4

-5

-6

-7
Defensive SP Competitive

Grand Strategy Matrix:

 Rapid Market Growth

Quadrant II Quadrant I

Domino's

Weak Strong
Competitive Competitive
Position Position

Quadrant III Quadrant IV

Slow Market Growth