Prepared by:Shardul Raut(26)Saqib Rizvi(27)Paridhi Sharma(28)Ajit Shenoi(29)

Business Strategy

Introduction

• Founded in 1960 in Michigan, U.S• Started International Expansion in 1983• 8500+ Stores which brings in $1.4 Billion • Brand Presence

– Worldwide – Largest Pizza Delivery Corporation– US and India – Second-Largest Pizza Delivery Restaurant

• 650 Stores across 137 cities in India• Innovative use of Technology

EXTERNAL ANALYSIS

Porter’s Five Forces

Threat of Entrants: Low

Major players have already shared the market Major players have also accumulated their advantages by building new restaurants, franchising, and expanding globally

Threat of Substitutes: High

Similar Menus Most of the fast food chain restaurants sell pizzas and burgers

Porter’s Five ForcesBuyer Power: High

Price is a key factor Consumers compare prices of fast food chains Restaurant loses customers if it is ‘irrationally’ high priced

Supplier Power: Medium

Major fast food chains negotiate prices through futures contract volatility in the food commodity costs can constrain the power of fast food chains to price their products

Porter’s Five Forces

Degree of Rivalry: High

Indian Fast Food Industry Market Share, 2013

The rivalry in the fast food industry gives firms more incentive to differentiate themselves from its competitors and meet customers’ needs

Key Success Factors

• Dominos focused on their core competency of delivery• Product affordability• Sales Promotion• Better quality pizzas at home: pizza dough• Leaner stores: Better operating margins• Wide range of products makes it differentiated from competitors• Allows flexibility of products at regional level• High international expansion offers dominos it’s greatest value

potential: Domino’s international network grew 48% from 2,987 stores to 4,422 stores between 2005-10

• Campaign ‘yeh hai rishton ka time’ has created an emotional connect

Threats

Growing health consciousness High competition limits prices and threatens margins High inflation leads to high commodity prices

Opportunities

Reduce baking time by employing better technology Introduce new toppings that are region specific Improve product range by introducing a wide variety of beverages and desserts Introduce a new division for dine-in

Life Cycle

Dominos is at the growth stage as the market for Pizza is still growing and the competition is fierce in the fast food industry. There is still a lot of scope for growth as this industry as a whole is in expansion mode with many untapped markets

Core Competency

• End-to-End Process– Store Location– Acquiring raw materials– Pizza Making– Operations– Pizza Delivery

Resources

• Financial• Physical• Technology• Brand Reputation• Human Resource

Brea

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Source of Competitive Advantage

BroadTarget

Market

NarrowTarget

Market

Cost

CostLeadership Differentiation

Generic Business Level Strategies

Uniqueness

Focused differentiation

Focused low cost

Cost Leadership Business Level Strategy

• The cost leadership strategy is an integrated set of actions taken to produce goods or services with features that are acceptable to customers at the lowest cost, relative to that of competitors.

• Cost leadership requires a strong focus on the supply side of the market.

• Dominos provides “No Frills” service.

• Core Competency lies in “30 minute delivery” promise. Faster service time leads to more efficient order handling.

• Costs controlled by keeping material procurement efficient and maintaining Economies of Scale.

• Domino's holds a 62% share in the organized pizza market and 70% share in the pizza delivery segment countrywide.

• Process Technology is updated frequently.

Technological Development

Human Resource Management

Firm Infrastructure

Procurement

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MARGIN

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Value Chain Analysis

Primary Activities

Supp

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Activ

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Inbound Logistics• Cheese, poultry, lamb etc. move from vendor factories to

four Domino's factories or commissaries in Noida, Mumbai, Kolkata and Bangalore. Domino's also makes its proprietary dough from the flour that comes in here.

• The ingredients are then loaded on to frozen trucks, which maintain the 1-4 degree Celsius temperature band, and taken to the stores.

• Each truck is enabled with GPS trackers, enabling the area logistics managers to access the temperature status in any of these vehicles.

PRIM

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ACTI

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Operations• When a customer calls, the order is flashed

on the kitchen screen. The pizza maker looks at it and gets down to the job at hand. From order to oven, it should not take more than 4 minutes.

• Baking takes 6 minutes. Cutting, packing and pick-up make up for, say, another five minutes. And delivery time never exceeds eight minutes. Sums up to 23 minutes.PR

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Outbound logistics

• Delivery time ideally kept at eight minutes.

• Domino’s employs low cost delivery system – 2 km radius for delivery by a particular unit. Here, the presence of a large number of stores contributes.

• Insulated delivery bags used to maintain the promise of delivering hot pizzas.PR

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TIVI

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Marketing and Sales

• Highly Trained Sales Force to meet the fast paced service provided.

• Products Priced to Generate Sales Volume – Pizza Singles and Pizza doubles option in the menu.

• National Scale Advertising – “Khushiyon ki Home Delivery” camapign.

PRIM

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Firm Infrastructure

• Jubilant Food Works Ltd., an Indian company based in Noida, Uttar Pradesh, holds the master franchise for Domino's Pizza in India.

• Employs close to 15,000 people.• It became a profit making company in

2006.

SUPP

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Human Resource Management

• Effective Training Programs to Improve Worker Efficiency and Effectiveness

• Bonuses provided to increase motivation among the employees rather than previous practice of penalizing employees for lost sales due to delay in delivery.

• Vendors trained and promoted to HACCP(Hazard analysis and critical control points) standards.

• Frequent quality checks administered.SUPP

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Technological Development • The key ingredient for the recent success of Domino’s

has been investments in the digital space and in mobile application where it aims to make it faster and easier for customers to place and track orders.

• The company has mobile ordering apps to cover about 95% of smartphones

• Store operations are regularly upgraded to maintain and further increase efficiency

• Investments in Technology in order to Reduce Costs Associated with Manufacturing Processes – Refrigerated trucks. SU

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