Domino’s Navigates Delivery Challenges and Expands with Electric Vehicles and Training Programs, (from page 20230708.)
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Keywords
- Domino’s
- pizza delivery
- sales growth
- dine-in
- delivery drivers
- electric vehicles
- company strategy
Themes
- Domino’s
- delivery business
- dine-in sales
- inflation
- electric vehicles
- market share
Other
- Category: business
- Type: news
Summary
Domino’s faces challenges in its delivery business, experiencing a 2.1% drop in delivery same-store sales in Q1, attributed to customers choosing dine-in and budget constraints. Despite this, the brand gained market share and improved delivery times. Carryout sales surged by 13.4%, highlighting a shift from non-Domino’s to Domino’s carryout. Overall, U.S. same-store sales rose by 3.6%, driven by price increases. The company is adapting to changes in consumer habits post-COVID, launching a significant training program and introducing electric vehicles to address driver shortages. With over 20,000 units globally, Domino’s continues to expand its presence both domestically and internationally.
Signals
name |
description |
change |
10-year |
driving-force |
relevancy |
Shift to Dine-In Dining |
Customers are returning to dine-in experiences, impacting delivery sales negatively for Domino’s. |
Shift from delivery and carryout back to dine-in dining experiences. |
Potentially more restaurants could focus on enhancing dine-in services and experiences. |
The resurgence of social dining experiences post-COVID as consumers seek social interactions. |
4 |
Electric Vehicle Delivery Fleet |
Domino’s has launched the country’s largest electric vehicle delivery fleet to combat driver shortages. |
Transition from traditional delivery vehicles to electric vehicles for deliveries. |
Widespread adoption of electric delivery fleets among food service businesses for sustainability. |
Increasing environmental awareness and regulations pushing towards electric vehicle use. |
5 |
First-Party Fulfillment Commitment |
Domino’s remains committed to first-party fulfillment despite using third-party services. |
Shift from reliance on third-party delivery services to more direct fulfillment. |
Potentially more restaurant brands may prioritize in-house delivery services for better control. |
Desire for better customer service and brand loyalty through direct fulfillment models. |
4 |
Technological Innovation in Ordering |
Introduction of in-car ordering through Apple CarPlay to streamline the ordering process. |
Evolution from traditional ordering methods to integrated technology solutions. |
Increased reliance on technology for seamless customer interactions in food delivery. |
Advancements in technology and consumer preferences for convenience and efficiency. |
3 |
Franchisee Training Initiatives |
Domino’s is implementing a large-scale training program for U.S. franchisees. |
Shift from general operational practices to focused training programs for franchisees. |
Franchise models may evolve to include more structured training and support systems. |
Need for improved service quality and operational efficiency in franchise businesses. |
3 |
Concerns
name |
description |
relevancy |
Driver Shortage |
Ongoing challenges in finding delivery drivers may hinder service efficiency and growth for Domino’s. |
4 |
Shift in Consumer Preferences |
A return to dine-in dining by consumers reduces demand for delivery services, impacting sales. |
5 |
Dependence on Carryout and Delivery |
Domino’s reliance on its carryout and delivery model is threatened by changes in consumer dining habits. |
4 |
Impact of Inflation on Consumer Spending |
Inflation is tightening consumer budgets, affecting order volumes and preferences for cheaper dining options. |
5 |
Technological Adaptation Challenges |
While innovations like in-car ordering can help, there’s a risk of technological implementations not meeting consumer expectations. |
3 |
Environmental Concerns with Delivery Vehicles |
Investing in electric vehicles aligns with sustainability but requires assessing overall environmental impacts and infrastructure. |
3 |
Franchisee Training and Support |
The effectiveness of large-scale training programs in enhancing service quality and operational efficiency needs continual evaluation. |
3 |
Behaviors
name |
description |
relevancy |
Shift to Dine-In |
Consumers are returning to dine-in options, impacting delivery sales for chains like Domino’s. |
4 |
Trade-Down from Non-Domino’s to Domino’s Carryout |
Customers are opting for Domino’s carryout over other options due to budget constraints. |
4 |
Investment in Electric Vehicle Fleet |
Domino’s launched the largest electric vehicle delivery fleet, addressing driver shortages and sustainability. |
5 |
Integration of Technology in Ordering |
Introduction of in-car ordering through Apple CarPlay enhances customer convenience in placing orders. |
4 |
Large-Scale Franchisee Training Programs |
Domino’s initiated a significant training program for franchisees, emphasizing operational improvements. |
3 |
Focus on First-Party Fulfillment |
Despite third-party partnerships, Domino’s remains committed to its own delivery service model. |
4 |
Technologies
description |
relevancy |
src |
Allows customers to place orders via their vehicle’s interface, enhancing convenience and integration with daily routines. |
4 |
07091cec2b85e059cd1a0fa65cbcfed4 |
Utilizing electric vehicles for deliveries to reduce emissions and operational costs while addressing driver shortages. |
5 |
07091cec2b85e059cd1a0fa65cbcfed4 |
Focus on internal delivery systems rather than relying solely on third-party aggregators, improving control over service quality. |
4 |
07091cec2b85e059cd1a0fa65cbcfed4 |
Large-scale training initiatives to enhance service and operational efficiency across franchises. |
3 |
07091cec2b85e059cd1a0fa65cbcfed4 |
Issues
name |
description |
relevancy |
Driver Shortage in Delivery Services |
The ongoing challenge of finding delivery drivers could hinder growth in the quick-service restaurant sector. |
4 |
Shift to Dine-In Dining |
A significant consumer shift back to dine-in options post-COVID may impact delivery sales for pizza brands like Domino’s. |
5 |
Electric Vehicle Adoption for Delivery |
The introduction of electric vehicles in delivery operations could set a precedent for sustainable practices in the restaurant industry. |
4 |
Inflation Impact on Consumer Behavior |
Consumers are trading down to more affordable carryout options, affecting sales dynamics for premium brands. |
4 |
In-Car Ordering Technology |
Advancements like in-car ordering through platforms like Apple CarPlay may redefine customer ordering experiences. |
3 |
Franchise Training Initiatives |
Large-scale training programs for franchisees can enhance operational consistency and service quality in the delivery sector. |
3 |