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Discussion Starter · #1 · (Edited)
For Domino's Pizza successfully compete in Australia where the marketplace is already crowded with individual pizza restaurants and takeaway shops, it had to modify its business model. In North America customers tend to eat fast food in restaurant-style outlets, while Australians usually purchase 'takeaway’ food to eat elsewhere; either at home or other venue. This cultural difference, along with some other contributing factors, has resulted in the following changes in the Domino's Pizza model 'down under’.

Labour costs for fast food outlets in Australia are higher than the United States, due to the lack of immigrant labour and a higher minimum wage. The cost of real estate, especially in state capital cities, is also relatively expensive, with few locations available for the typical large fast food restaurants commonly seen throughout the United States. All these factors have an impact on the cost of goods sold. The solution for Australia was to develop shop-front pizza outlets (without dining areas) that used most of the storage space for food preparation and the remainder for a comparatively small waiting area for customers. This type of store reduced the level of labour required in the stores, and eliminated the floor space needed for dining rooms (thereby reducing building and land costs), making Domino's a very competitive fast food provider in Australia.

In order to compete well in the low-cost sector of the market, Domino's Pizza follows a strategy of reduced price promotions that 'bundle' the sale of pizza; drinks and extras (e.g., garlic bread). The pizza production processes are all standardized, resulting in a rapidly produced and relatively low-cost product, so although Domino’s may 'lose’ money during its promotions on individual pizzas it makes money on the 'total' sale. Even with heavily discounted specials, it has a policy of 'not reducing the quality or quantity of ingredients used in the pizzas, as customers notice when the pizza doesn't taste as good as the last time'.

Domino's also offers the option of extra toppings and changes from the 'basics', although charging more for the service.
 

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Domino\\\'s Pizza in Melbourne

Domino\\\'s Pizza - Western Suburbs Melbourne Victoria NC1506 for sale. Find more details at: http://www.businesses2sell.com.au/details/48674/dominos-pizza-synott-st-werribee-melbourne-nc
 
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