All of the questions go together, so please answer all of them. As CEO Doyle and
ID: 459591 • Letter: A
Question
All of the questions go together, so please answer all of them.
As CEO Doyle and his management team contemplate the future direction of Domino's, it has much to consider:
Should the firm continue its aggressive market development strategies and accept the risk associated with expanding into markets it has little expertise operating within?
What new geographic locations or regions should Domino's focus?
Should Domino's simply follow Pizza Hut's international rollout of stores?
How would this expansion affect the corporate structure of Domino's?
Would restructuring by geographic division and thus establishing offices in Asia, the Middle East, and South America better enable them to manage these more risky environments?
Can Domino's afford this financially?
Should Domino's consider offering salads or a line of healthy menu options?
Should Domino's purchase trucks to deliver its products rather than incurring such heay leasing expenses?
Explanation / Answer
CEO Doyle and his management team should consider the following strategies for the future direction of Domino’s:
1. Domino’s should consider its aggressive market development strategies and accept the risk associated with expanding into markets it has little expertise operating within. Aggressive market development strategies will keep the company’s focus on ever changing customer opportunities, emerging markets and economies. 2. Domino’s should focus on new geographic regions. Since they do not provide dine-in restaurants, there would not be a huge expenditure to opening stores in new geographic regions, particularly in Europeans areas such as Germany, Ireland and Wales.
3. Domino’s should follow Pizza Hut’s international rollout of stores. Pizza Hunt is Domino’s number one rival in the international market (David & David, 2015). Although many of the international countries have a large number of mom and pop restaurants, Domino’s has 5,337 international franchises and Pizza Hut has 5,600 international establishments. Domino’s realized their highest growth in 2012 in their International segment and should continue rolling out new stores.
4. This rollout would positively affect the corporate structure of Domino’s. Domino’s as international stores are franchises. The company’s revenue from the international stores is from royalty payments, advertising and the sale of food and supplies. Revenue from international franchises has increased 8% from previous years.
5. Restructuring by geographic division and establishing offices in Asia, the Middle East, and South America would better enable Domino’s to manage these more risky environments. Domino’s has realized increased international revenues and increased number of stores these areas, particularly in India, Turkey and Japan (David & David, 2015).
6. Domino’s can afford this financially, as there work is worldwide.
7. No, since its a fast food item, no need to provide such services.
8. Bikes are the good medium, also inexpensive to deliver orders.