We charge our franchisees a license fee for their sales, some of which are passed on to Domino`s Pizza International Franchising Inc. as royalty. Domino`s business in the UK and republic of Ireland is based on the entrepreneurial spirit and operational expertise of our franchisees, and it is our duty to ensure they have everything they need to deliver fantastic service day in and day out. The slogan “Greatness from Dominos” doesn`t just apply to the taste of their pizzas. The business model behind this fast food chain has made it possible to become a well-known name around the world and, after improving after a series of early setbacks, they are the definition of master franchise specialists. Despite some fairly significant setbacks, Domino`s remains a great wig in the world of fast food. After the creation of the first franchised site in 1967, the pizzeria now has more than 11,000 stores worldwide. One of the essential factors of this success is the decision to opt for master franchise contracts. By handing over franchising activities in a particular area to a natural or legal person, Domino`s has been able to thrive internationally. By adapting the basics of a primary franchise agreement and adapting them to certain countries and cultures, Domino`s can avoid the future Chinese hiccups. Brand development. In addition to the royalty, Domino`s also collects a 6% marketing and advertising fee, based on sales from domestic franchisees.
These funds are used for advertising, commercial production, public relations, market research and other brand advertising activities. Domino`s franchise revenue represents 12% of total revenue. In comparison, the revenue of mcDonald`s (MCD) franchisee represents about a third of the company`s total turnover. MCD accounts for between 3% and 4% of the consumer Discretionary Select Sector SPDR (XLY) and etf (IYC) iShares U.S. Consumer Services. Finally, we sell our fresh and tasty pizza dough as well as other food and non-food products to franchisees. Franchise Description: The franchisor is Domino`s Pizza Franchising LLC. Currently, the franchisee only grants the business franchise candidates who have recently managed or supervised a business for at least 12 months. Franchisees operate a domino pizza store that sells pizzas and other authorized products through delivery and carry-out services. These are the franchise formats used by Domino`s Pizza: Domino`s franchise agreement usually has a ten-year term and can be extended for another ten years. According to company documents, Domino`s expansion rate is 99%. The master franchise also gives the master franchisee exploitation rights in a supply chain in a given region.
Needless to say, the potential master franchisee must demonstrate certain requirements such as knowledge of local legislation, understanding of local consumers, and appreciation of real estate restrictions in the area. Among other things, potential master franchisees must also have access to capital. The graph below shows the number of international restaurants, most of which are developed by master franchise agreements. All our franchisees contribute to a marketing fund and we recommend a series of promotional and promotional activities in order to increase the company`s turnover. Dominos Pizza`s itineraries are not as modest as other successes. Although they started in a small pizza store called DomiNicks, founders Tom and James Monaghan already had big plans for the pizza store in those early stages. After James traded his half of the Domino`s business for his Volkswagen Beetle brothers, the responsibility of driving Domino`s in the lead was on Tom`s shoulders.