Domino's India Logistics Management

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Case Details:

Case Code : OPER005
Case Length : 10 Pages
Period : 1999 - 2003
Organization : Domino's
Pub Date : 2003
Teaching Note : Available
Countries : India
Industry : Food, Beverage and Tobacco

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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Background Note

In the late 1950s, Dominick De Varti (Varti) owned a small pizza store named DomiNick's Pizza on the Eastern Michigan University campus in Ypsilanti, Michigan. In 1960, two brothers who were students of the University of Michigan – Thomas S. Monaghan (Thomas) and James S. Monaghan (James) – bought the store for US$900. In 1961, James sold his share of business to Thomas.

The pizza business did well and by 1965, Thomas was able to open two more stores in the town – Pizza King and Pizza from the Prop. Within a year, Varti opened a pizza store in a neighborhood town with the same name, DomiNick's Pizza.

Operations Management Case Studies | Case Study in Management, Operations, Strategies, Marketing Management, Case Studies

Thomas decided to change the name of his first store, DomiNick's Pizza, and one of his employees suggested the name Domino's Pizza (Domino's). The advantage of this name Thomas felt was that it would be listed after DomiNick in the directory.

Domino's philosophy rested on two principles – limited menu and delivering hot and fresh pizzas within half-an-hour. In 1967, it opened the first franchise store in Ypsilanti, and in 1968, a franchise store in Burlington, Vermont. However, the company ran into problems when its headquarters (the first store) and commissary were destroyed by fire. In the early 1970s, the company faced problems again when it was sued by Amstar, the parent company of Domino Sugar for trademark infringement. Thomas started looking for a new name and came up with Red Domino's and Pizza's Dispatch. However, there wasn't any need for it because Domino's won the lawsuit in 1980.

In 1982, Domino's Pizza established Domino's Pizza International (DPI) that was made responsible for opening Domino's stores internationally. The first store was opened in Winnipeg, Canada. Within a year, DPI spread to more than 50 countries and in 1983, it inaugurated its 1000th store (Refer Exhibit II for worldwide revenues). Around the same time, new pizza chains like Pizza Hut and Little Caesar established themselves in the US. Domino's Pizza faced intense competition because it had not changed its menu of traditional hand-tossed pizza. The other pizza chains offered low-priced breadsticks, salads and other fast food apart from pizzas...

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