Pizza Market Saturation? Domino's Pizza CEO Departs After Pivot Into Fried Chicken.
A boss of Domino's Pizza Group who proposed the UK might have hit pizza saturation while broadening the franchise into fried chicken has been replaced after conflicts with its directors.
Leadership Shake-Up
Andrew Rennie is exiting after only 24 months in leadership, and will be succeeded on an temporary basis by the organization's chief operating officer, Frampton, while the pizza giant searches for a permanent CEO.
Rennie, who worked for Domino's for more than two decades, had sought to redirect the UK's largest pizza delivery company towards poultry-based products, remarking in a recent interview there was not “massive growth” left in the UK's pizza market. He observed poultry was the fastest-growing protein in the international market.
Board Disagreements
Reports indicate that there was disagreement between the CEO and the governance team over his focus and direction, although the company's announcement said he was stepping down “by mutual agreement”.
Recent Product Launch
In September, Domino's unveiled its poultry offering – which the former chief described as a “major strategic shift” for the company – and is piloting it in over 200 locations in the North West region and the province.
While the business is still planning to expand it across its nearly 1,400 branches next year as planned, it considers chicken products as a supplement for its core pizza business.
Board Statement
Bull, the company chair, said: “The board believes that there are a number of opportunities to enhance value and value creation in the main pizza segment. We are prioritizing finding the right chief executive to oversee the disciplined execution of that growth strategy.”
Market Difficulties
Earlier this month, the pizza delivery giant, which has a substantial customer base in the UK and Ireland, said transactions dipped by 1.5 percent in the latest quarter. In the summer, it cautioned that the quick-service industry had “intensified” as it attributed reduced spending in the run-up to the budget and higher payroll outlays for below-target performance and a significant fall in six-month income.
Other pizza operators are also facing challenges. Another major chain disclosed the closing of 68 restaurants a recently, after the company behind its UK venues entered insolvency.
Health Efforts
Trying to keep up with market shifts towards better nutrition, the company has launched reduced-calorie items, such as its thin-crust selection of bakes below 400 kcal as well as vegan and wheat-free options. A family-sized pepperoni has over 2,300 kcal. A large cheese and tomato pizza has 2,171, while a individual has under 1,000 calories.
Acting Leadership
The interim chief has been with Domino's since the recent past, and was formerly with the gambling company a well-known operator. It is understood that she prefers not to assume the CEO position long-term.
She said: “The company has a number of ongoing expansion and performance initiatives that we will be concentrating on executing at pace.”
Frampton noted these comprised ongoing development on the company's procurement system and new item creation, and its loyalty scheme.
Domino's is also without a full-time CFO until 16 March, when Andy Andrea starts from the beverage producer C&C Group. Until then, Snow acts as acting financial officer.