Domino's Pizza Enterprises Limited · ASX:DMP
Domino's Pizza Enterprises — Investor Presentation (November 2013)
61 slides from Domino's Pizza Enterprises's investor presentation, Nov 12, 2013
Slide 1: DPJ Update
For personal use only Domino’s Pizza Enterprises Ltd DPJ Update 12th November, 2013 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 2: Scott K. Oelkers, President & CEO, Domino's Pizza Japan
For personal use only Scott K. Oelkers President & Chief Executive Officer Domino’s Pizza Japan Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 3: DPJ Executive Team
DPJ Executive Team For personal use only Name Title/Position Experiences Mr. Scott K. Oelkers President and Domino’s Experience: 25 years Chief Executive Officer Prior Experience: Pizza Vest Pronaia Capital Domino’s Pizza International Mr. Kenji Imada Representative Director and Domino’s Experience:
Slide 4: DPJ Executive Team
DPJ Executive Team For personal use only Name Title/Position Experiences Mr. Kenji Ikeda Executive Vice President, Domino’s Experience: 25 years Marketing Division 3.5 years as Executive Vice President, Marketing Division 9 years as Marketing Department Head 2 years as Business Development Departmen
Slide 5: Agenda
Agenda For personal use only 1. Investor Re-cap 2. What Do We Sell? 3. How Did We Grow? 4. New Store Model 5. How Do We Get to 600 Stores? 6. Carve Out 7. Why Relocate? 8. Who Are Our Franchisees? 9. People 10. Research Project 5 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 6: 1. Investor Re-cap
For personal use only 1. Investor Re-cap Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 7: Overview of Domino's Pizza Japan
Overview of Domino’s Pizza Japan For personal use only DPJ is the third largest pizza chain in Japan by number of stores with a primary focus on the Tokyo and Osaka regions and potential for expansion in new regions • Domino’s Pizza commenced operations in Japan in Store Locations(1) 1985 and has gr
Slide 8: #3 Position in Japanese Pizza Market
#3 Position in Japanese Pizza Market For personal use only • There are approximately 2,150 chain pizza outlets in Japan(1), with the three main players representing approximately 1,190 stores(2)(3) • Pizza-La, Pizza Hut and Domino’s Pizza lead the market in Tokyo and Osaka by number of stores • High
Slide 9: Diverse Product Offering
Diverse Product Offering For personal use only • DPJ has a diverse menu offering with more than 280 items at a premium price point – Quattro-style pizzas are the key category, comprising 46% of total sales – Medium-sized quattro pizza priced between approximately A$25 and A$35 9 Investor Site Tour D
Slide 10: Strategic Plan for Growth
Strategic Plan for Growth Key Initiatives for DPJ For personal use only • Franchise system opportunity – Potential to move to a 30% franchise model, and potentially a greater mix as DPJ targets 600 stores – Potential to leverage operational depth by offering franchise funding to high performing stor
Slide 11: Expanded Group Structure
Expanded Group Structure For personal use only • DPJ will continue to operate as a stand alone operating entity reporting to the newly formed board of DPJ with oversight from a senior leadership team from DPE – New DPJ Board with up to 9 members – Up to 7 from DPE and up to 2 from Bain Capital 11 In
Slide 12: 2. What Do We Sell?
For personal use only 2. What Do We Sell? Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 13: Product Portfolio (Pizza)
Product Portfolio (Pizza) For personal use only Luxury Winter campaign Quattro Super Delicious Cheese Melt Quattro Premier Summer campaign Korean Garbi ExtraVaganzza Deep Dish Mega Veggie Light/ Crispy Heavy user Mille-Feuille New user Quattro Giant Spring campaign BBQ Basil Deluxe Garlic Chicken Cr
Slide 14: Product Portfolio (Side Menu)
Product Portfolio (Side Menu) For personal use only High Price Christmas Family Pack Quattro Pasta & Risotto Roasted Party Sparerib Chicken Chicken Salt & Pepper Chicken Salad Campaign desserts Hot Subs Rotisserie Chicken Fried Potato (L) Mixed Side Set Personal Party Popcorn Chicken Shrimp Nugget (
Slide 15: 3. How Did We Grow? What did we change?
For personal use only 3. How Did We Grow? What did we change? Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 16: Store Count & Revenue Trend
Store Count & Revenue Trend Store First Master Boom-Boom Revenue For personal use only Bain Doldrums Years DPE Counts Franchisee Days (JPY/MN) 300 25,000 Store Counts Revenue 250 20,000 200 15,000 150 276 264 10,000 219 204 197 197 100 189 179 177 177 174 173 170 170 168 167 160 160 145 121 5,000 10
Slide 17: What did we change?
What did we change? • Created a sense of ownership with For personal use only Manager Bonus Program – Criteria: Food, Labor, Safety, Incentive Criteria Service Time, Customer, OER OER Food – Pool size: Based on sales 20% 20% achievement Customer 10% Service Labor Time 30% 10% Safety 10% 17 Investor
Slide 18: What did we change?
What did we change? For personal use only Crew Labor % vs Gross Sales This Year Last Year 3 Yrs 4 Yrs 5 Yrs National BOGO carry out Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun 18 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 19: What did we change?
What did we change? For personal use only OER Improvement < 1-star > 4-star 100% 82% 80% 67% 60% 40% 20% 1% 2% 0% 19 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 20: Scooter Repair Shop?
Scooter Repair Shop? For personal use only 20 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 21: Scooter Repair Shop?
Scooter Repair Shop? For personal use only 21 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 22: We are not scooter repair shop anymore.
We are not scooter repair shop anymore. For personal use only 22 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 23: We are not scooter repair shop anymore.
We are not scooter repair shop anymore. For personal use only 23 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 24: We are not scooter repair shop anymore.
We are not scooter repair shop anymore. For personal use only 24 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 25: We are not scooter repair shop anymore.
We are not scooter repair shop anymore. For personal use only 25 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 26: We are not scooter repair shop anymore.
We are not scooter repair shop anymore. For personal use only 26 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 27: Pass Through Window
Pass Through Window For personal use only 27 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 28: Pass Through Window
Pass Through Window For personal use only 28 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 29: Pass through windows are gone.
Pass through windows are gone. For personal use only 29 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 30: Pass through windows are gone.
Pass through windows are gone. For personal use only 30 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 31: Pass through windows are gone.
Pass through windows are gone. For personal use only 31 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 32: What did we change?
What did we change? • New image allows carry out growth. For personal use only Carry Out % Trend BOGO TVC 35% 30% 25% 20% National BOGO carry out 15% 10% 5% 0% 32 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 33: 4. New Store Model
For personal use only 4. New Store Model Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 34: What are differences?
What are differences? • Better awareness, Better visibility, Better For personal use only accessibility, Better service, Better product Past Current Location Off street Main street Awareness Traffic Low Heavy Front of site Narrow Wide Visibility Small/ Front lit Wide & Broad/ Back-lit Signage Single
Slide 35: Initial Cost Model
Initial Cost Model For personal use only CAPEX Component Ratio Interior Kitchen Equipment Construction 30% 30% Signage Construction 10% Facility Construction 30% 35 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 36: Carry Out Sales and Ratio
Carry Out Sales and Ratio • New image = Carry out positive For personal use only Carry Out % Trend by Vintage 75% BOGO TVC Pre -2010 2010 New Store Avg. 2011 New Store Avg. 2012 New Store Avg. KUMAGAYA CHUO 2013 New Store Avg. MISATO CHUO 50% National BOGO TAKASAKI carry out MISATO CHUO YOTSUKAIDO 2
Slide 37: Mystery Shopper Survey
Mystery Shopper Survey • New image = Better carry out service For personal use only New Image Others Recommendation 5 Cost performance 4.5 Repeat mind 4 3.5 Pizza quality 3 Cleanliness 2.5 Service time Order taking Pick up Atmosphere Note: Company survey in August 2013, Scale of 1 to 5 37 Investor S
Slide 38: Further New Store Format
Further New Store Format • Researching the first site and the cost For personal use only based on the DPE “Entice” store • Start: January 2014 DPJ Back Street Store Format DPJ High Street Store Format DPE “Entice” Store Format 38 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 39: New Uniform
New Uniform • Comparing the cost of new uniforms (New For personal use only international or DPE Entice, Import or domestic manufacture) • Start: Around June 2014 after finishing the inventories of current uniforms Current Uniform New International Uniform DPE “Entice” Uniform 39 Investor Site Tour
Slide 40: 5. How Do We Get to Stores?
For personal use only 5. How Do We Get to 600 Stores? Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 41: Store Develop Potential
Store Develop Potential For personal use only Scenario 1 Scenario 2 Projection Address Count per store 50,000 40,000 ≈ 45,000 Total 523 705 600 (Researched in 2013) (Researched in 2013) (Company study) 41 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 42: How do we get to stores? Greater Tokyo
How do we get to 600 stores? • We grow new territory. For personal use only Greater Tokyo Mar 2010 Sep 2013 42 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 43: How do we get to stores? Greater Osaka
How do we get to 600 stores? • We grow new territory. For personal use only Greater Osaka Mar 2010 Sep 2013 43 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 44: How do we get to stores? Nagoya
How do we get to 600 stores? • We grow new territory. For personal use only Nagoya Mar 2010 Sep 2013 44 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 45: How do we get to stores? Fukuoka
How do we get to 600 stores? • We grow new territory. For personal use only Fukuoka Mar 2010 Sep 2013 45 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 46: 6. Carve Out
For personal use only 6. Carve Out Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 47: Carve Out
Carve Out • We grew via carve outs. For personal use only 3 stores 4 stores 2 2 3 3 1 1 4 47 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 48: Carve Out
Carve Out • We grew via carve outs. For personal use only 4 stores 5 stores 2 2 3 3 1 1 5 4 4 48 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 49: 7. Why Relocate?
For personal use only 7. Why Relocate? Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 50: Relocations have proven effective to date.
Relocations have proven effective to date. For personal use only Monthly Sales PCYA (Jul – Oct) 0% 50 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 51: 8. Who Are Our Franchisees?
For personal use only 8. Who Are Our Franchisees? Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 52: Franchised Store Development
Franchised Store Development • Growing for this 3 years, especially IFC For personal use only Franchised Store Count Franchisee Origins(2) 46(1) Kacho 7% 39 External SVR 27% 14% 26 18 HQ Staff 7% 3 MGR 45% 2009 2010 2011 2012 2013 Note: (1) Number of stores as at 31 October 2013, (2) Percentage of f
Slide 53: CAN DO! Partners
CAN DO! Partners • CAN DO! Partners program is a unique For personal use only approach to franchising for Japan. • Franchisee has a lot of opportunities. ~ Opening • Can start with low initial investment • Can get full support of DPJ store development team Operating ~ 3 years • Operate as an interna
Slide 54: 9. People
For personal use only 9. People Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 55: New Training System
New Training System For personal use only We are introducing a new training system named ‘Mammoth’ 55 Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 56: What we want to achieve?
What we want to achieve? 1. Single training program for full-time Use of the same same 190 step For personal use only and part-time training program and tools for everyone of any store (both corporate and FC) 2. Efficient program to produce MGR Clearly targeting MGR skills and and A-MIT (5 per s
Slide 57: Monitoring
Monitoring • Crew learning is accelerating. For personal use only Store Total Steps (DPJ) Crew Average Steps (DPJ) Store Total Step (DPJ) Temporary Steps (DPJ) Crew Average Steps (DPJ) Temporary Steps (DPJ) 4.4 108 9.0 213 51.5 1,255 44.1 1,046 27.4 637 22.7 525 18.1 392 13.7 294 154 7.5 57 Investor
Slide 58: 10. Research Project
For personal use only 10. Research Project Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 59: Objectives
Objectives • ‘Where to Play’ & ‘How to Win’ For personal use only Objective Research To fully understand where key 1. Sensory research (CLT) opportunities exist for DPJ Appearance (Overall, Cheese, Topping, etc) Taste (Overall, Cheese, Topping, etc) Bringing competitor users to 2. Qualitative
Slide 60: Any Questions?
For personal use only Any Questions? Investor Site Tour Domino’s Pizza Enterprises Ltd
Slide 61: For personal use only
For personal use only Investor Site Tour Domino’s Pizza Enterprises Ltd
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