Domino’s Pizza has closed its Italian shops after seven years, after the US model struggled to win over clients within the birthplace of pizza.
The fast-food chain’s Italian franchise companion, ePizza SpA, which operated 29 branches throughout the nation, filed for chapter in early April.
As a part of insolvency proceedings, it was granted a 90-day courtroom safety from its collectors, which stopped them demanding repayments or seizing firm belongings. However the keep elapsed final month.
Domino’s Italian operations succumbed to a mixture of falling gross sales, elevated operating prices, excessive money owed and “an exponential improve” in competitors from conventional pizza eating places providing supply via apps, comparable to Glovo, Simply Eat and Deliveroo, in line with the chapter filings from April.
The Michigan-headquartered pizza chain has round 18,800 shops in 90 markets worldwide, most of that are run by franchisees.
As lately as early 2020, the US chain introduced formidable plans so as to add 850 shops in Italy and obtain 2 per cent market share by 2030, however the pandemic pushed its Italian franchise companion to the brink. “The Covid-19 pandemic and the extended successive restrictions have gravely broken . . . ePizza,” the chapter filings added.
Domino’s stopped accepting supply orders from its Italian web site on July 29. Domino’s Pizza Inc, the US umbrella firm, didn’t instantly reply to a request for remark. Marcelo Bottoli, ePizza SpA’s chair and largest shareholder, refused to remark when contacted by the Monetary Instances.
Final month, German grocery app Gorillas mentioned it was withdrawing from the Italian market, in addition to a number of different European international locations.
The information of Domino’s closure in Italy, first reported by Bloomberg, is one other indication of the blended fortunes of US restaurant manufacturers hoping to succeed amongst exacting Italian customers.
The arrival of the primary Starbucks in Italy in 2018 was greeted with scepticism. However Howard Schultz, Starbucks CEO, mentioned final week the espresso chain, which operates a single espresso bar in Milan, was “flourishing” and would add two extra branches in Rome and Florence.
In 2021, ePizza SpA reported gross sales of €10.4mn, up 8.6 per cent on the 12 months earlier than however 36.8 per cent down on the goal gross sales for that 12 months. In December 2021, the corporate’s money reserves stood at solely €492,000, almost 80 per cent beneath what was budgeted for.
In a buying and selling replace issued in April, the agency blamed the poor gross sales efficiency on elevated competitors from “‘mother and pop’ eating places” together with “revenge spending” on eating places when pandemic restrictions eased.
Extra reporting by Donato Paolo Mancini