Tag: Business

Domino’s is reportedly shutting down in Italy after locals failed to acquire a taste for its American-style pies.

Domino’s has now shuttered all 29 of its local stores in the country after entering in 2015 through a franchising agreement with local operator ePizza SpA, the report said.

The Michigan-based chain originally planned to open 880 stores in Italy, betting that Italians would embrace its delivery services.

Instead, Domino’s encountered tough competition from Italian pizzerias and restaurants that found success by bolstering their own delivery efforts or striking partnerships with outside food delivery firms.

“We attribute the issue to the significantly increased level of competition in the food delivery market with both organized chains and ‘mom & pop’ restaurants delivering food, to service and restaurants reopening post pandemic and consumers out and about with revenge spending,” ePizza said in an investor report alongside its fourth-quarter results last year, according to Bloomberg.

Meanwhile, Domino’s local operations encountered financial trouble during the planned expansion. The company had an outstanding debt of $10.8 million as of the end of 2020 and obtained a temporary reprieve from its creditors through an Italian court order in April – but the protection expired on July 1.

Current Domino’s Pizza CEO Richard Ellison acknowledged the difficulty of breaking into the Italian market in 2015, when he was serving as president of Domino’s international operations.

US-based representatives for Domino’s did not immediately return a request for comment. Representatives for ePizza did not return Bloomberg’s request for comment.

“No major American pizza brand has successfully entered the market,” Allison said at the time, according to MarketWatch. “We’re going where no major pizza brand has gone before.”

Alessandro Lazzaroni, the Italian entrepreneur who headed up local operations, pledged to keep the product familiar to locals while adding a Domino’s spin.

“We’ve created our own recipe, starting from the original pizza recipe, with Italian products, like 100% tomato sauce and mozzarella, and products like prosciutto di Parma, gorgonzola, grana padano and mozzarella di bufala campana,” Lazzaroni said in a statement in 2015.

Domino’s had previously ceased delivery operations on its website in Italy as of July 29, according to Bloomberg.

Some locals took the news hard, taking to social media to gripe about the shutdowns and complain that their local stores had shuttered, according to the outlet.