Peak Pizza? Domino's Pizza CEO Departs Following Move Into Fried Chicken.
The head of the UK's Domino's Pizza chain who indicated the UK might have hit pizza saturation while diversifying the company into fried chicken has been replaced after conflicts with its directors.
Executive Change
Rennie is departing after a brief tenure in the top role, and will be succeeded on an temporary basis by the company's chief operating officer, Frampton, while Domino's searches for a permanent CEO.
The outgoing executive, who served at Domino's for over 20 years, had sought to shift the UK's largest pizza takeaway chain towards poultry-based products, remarking in a recent interview there was not “massive growth” left in the UK's pizza market. He observed chicken was the most rapidly expanding food category in the international market.
Board Friction
Reports indicate that there was friction between Rennie and the board over his approach and business vision, although Domino's release said he was leaving “by mutual agreement”.
New Brand Introduction
In the autumn, the chain introduced its Chick 'N' Dip offering – which Rennie described as a “major strategic shift” for the organization – and is testing it in select stores in the north-west of England and Northern Ireland.
While the firm is still going to roll it out across its nearly 1,400 branches in the coming year as scheduled, it considers fried chicken as a supplement for its primary pizza operations.
Board Comment
Ian Bull, the company chair, said: “We are confident that there are a number of opportunities to drive further growth and profitability in the main pizza segment. We are concentrating on identifying the suitable leader to oversee the careful implementation of that development approach.”
Industry Challenges
In the latest update, the pizza delivery giant, which has a substantial customer base in the British Isles, said orders fell by one and a half percent in the Q3. In August, it cautioned that the takeaway market had “intensified” as it blamed economic uncertainty in the run-up to the budget and increasing labor expenses for below-target performance and a 15 percent decline in six-month income.
Rival chains are also experiencing difficulties. Pizza Hut announced the shutting of multiple locations a recently, after the company behind its British operations fell into administration.
Wellness Efforts
Trying to keep up with consumer trends towards better nutrition, the company has rolled out reduced-calorie products, such as its Thin & Crispy range of pizzas below 400 kcals as well as vegan and gluten-free options. A big pepperoni bake has over 2,300 kcal. A large cheese and tomato pizza has 2,171, while a individual has under 1,000 calories.
Interim Management
Frampton has been with Domino's since the recent past, and previously worked for the gaming group a well-known operator. It is thought that she prefers not to assume the top job long-term.
She commented: “We have a several ongoing expansion and performance initiatives that we will be concentrating on carrying out at speed.”
She added these included ongoing development on the company's logistics network and product development, and its rewards program.
Domino's is also lacking a permanent CFO until March 16, when Andy Andrea comes aboard from the beverage producer a well-known firm. Until then, Richard Snow acts as acting financial officer.