Domino's was founded in Michigan by Tom Monaghan in 1960 at the end of FY 2007 the company operated over 8000

locations in all 50 states and 55 countries. The company focuses on two core strengths: high quality pizza and fast delivery. Domino's business model sits on three pillars: 1) low cost delivery-oriented store design, 2) franchising and 3) a vertically integrated supply chain [9]. The company operates in three segments: domestic stores, domestic supply chain and international. Domestic Stores
About 90% of the company's 5,155 domestic stores are franchised

. Domino's uses its company-owned stores as a

testing ground for new products and technologies which may then be passed onto franchisees. Domino's generates income from company-owned stores in the form of store profits; income from franchisees mostly comes from royalties. Domestic stores had revenues of $552.6 million and operating income of $128.6 million during 2007


Domestic supply chain
This segment operates 17 supply chain centers that distribute food, equipment and supplies to almost all Domino's in the United States

. A vertically integrated supply system provides two important advantages to Domino's and its

franchisees. First, automatic delivery of raw materials cuts out a lot of the "back-of-store" activities letting store operators focus more on sales and customer service

. Second, the vertically integrated supply chain lets Domino's

leverage the purchasing power of thousands of company-owned and franchised stores nationwide which can help keep down food costs

. In fiscal 2007, the domestic supply segment generated revenues of $783.3 million and

operating income $49.7 million.


Domino's international segment consists of 3,469 franchised stores outside the United States.

Domino's also has a

supply chain in a limited number of its international markets; the company operates six supply chain centers which manufacture dough and distribute food and supplies. Domino's international operation have consistently grown as a percentage of company locations and systemwide revenues; in 2007, the international segment accounted for 41% of Domino's store sales worldwide

(note: this figure represents percentage of total sales at company-owned and

franchise stores and is not percentage of company revenue.) During 2007, Domino's international segment generated revenues of $126.9 million, of which approximately 52% resulted from the collection of franchise royalties and fees, accounting for 93% of the segment's $57.2 million in operating income


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