Peak Pizza? Domino's Leader Departs After Move Into Fried Chicken.
A head of the UK's Domino's Pizza chain who suggested the United Kingdom might have reached pizza saturation while expanding the company into fried chicken has been ousted after tensions with its board.
Executive Change
The former CEO is departing after a brief tenure in the top role, and will be succeeded on an acting basis by the company's operations head, Frampton, while the pizza giant looks for a permanent CEO.
The outgoing executive, who was with Domino's for over 20 years, had aimed to redirect Britain's biggest pizza delivery company towards poultry-based products, commenting in a recent interview there was not “massive growth” left in the British pizza industry. He said chicken was the most rapidly expanding menu item in the international market.
Board Friction
It is understood that there was disagreement between the CEO and the directors over his strategy and direction, although Domino's official statement said he was departing “through mutual consent”.
Recent Brand Launch
In September, the chain introduced its Chick 'N' Dip brand – which Rennie referred to as a “significant new phase” for the company – and is testing it in over 200 locations in the north-west of England and Northern Ireland.
While the business is still going to roll it out across its extensive network in the coming year as intended, it regards chicken products as complementary to its primary pizza operations.
Leadership Statement
Bull, the Domino's chair, said: “We are confident that there are a number of opportunities to drive further growth and profitability in our primary operations. We are focused on identifying the ideal CEO to direct the careful implementation of that development approach.”
Market Difficulties
Recently, Domino's, which has a substantial customer base in the British Isles, said orders declined by one and a half percent in the Q3. In the summer, it cautioned that the quick-service industry had “become tougher” as it attributed reduced spending in the period before the government announcement and increasing labor expenses for below-target performance and a 15% drop in half-year profits.
Rival chains are also experiencing difficulties. Another major chain disclosed the closure of 68 restaurants a last month, after the company behind its outlets entered insolvency.
Wellness Initiatives
Responding to market shifts towards better nutrition, Domino's has rolled out light items, such as its light base line of pizzas below 400 calories as well as vegan and allergy-friendly pizzas. A large pepperoni pizza has 2,311 calories. A big margherita has over 2,100, while a small has 909 calories.
Interim Management
Frampton has been with Domino's since the recent past, and had a background at the gaming group William Hill. It is believed that she is not seeking to assume the chief executive role on a full-time basis.
She said: “We have a number of current growth and operational projects that we will be concentrating on executing at pace.”
She said these comprised additional efforts on the organization's logistics network and new item creation, and its loyalty scheme.
Domino's is also in need of a permanent CFO until the spring, when Andrea starts from the beverage producer C&C Group. For now, Richard Snow serves as interim finance chief.