Domino’s aiming to grab bigger slice of the pizza

Jul 22 2008 by Chris Knox, The Journal

AMERICAN pizza chain Domino’s is set to create jobs as it looks to take a bigger slice of the North East fast food market.

The firm, which already has nine stores in the region, is looking to open three more in Newcastle, one in Sunderland and one in South Shields as it sees the region as a prime target for its home delivery empire.

News of its expansion plans follows a rise in half-year profits and sales as consumers opted to dine at home during the current economic downturn. The delivery firm, which operates a network of franchised stores, told the City it was well placed to exceed market expectations for the year.

The prediction came after pre-tax profits increased by 32.7% to £10.9m, while like-for-like sales were ahead 11.4% in the 26 weeks to June 29.

The North East expansion is expected to create around 50 full and part time jobs by the end of the year and will provide franchise opportunities for the region’s budding entrepreneurs.

Andy Emmerson, business development director at Domino’s Pizza, said: “Newcastle is a vibrant community and our research has shown there is plenty of demand for the Domino’s home delivered pizza service, so we are very keen to open new stores there.”

The new sites are part of the fast food company’s long term plans to open 50 new stores in the UK and Ireland each year in addition to the 525 it already operates.

In a trading update Domino’s said fixed contracts and higher retail prices had shielded it from food and energy price inflation, although it warned further “modest” price increases were likely early next year.

Chairman Stephen Hemsley said the results were achieved in a “significantly tougher trading environment”.

He added: “The trend that we are witnessing so far is that many consumers are ‘trading down’, which in our industry means that they are eating out less often and staying at home.

“Once these consumers have decided to stay at home, Domino’s has the opportunity to serve them and with the combination of a great product, excellent service and effective marketing, we have achieved record levels of system sales in the first half of the year.”