How Much Does a Domino’s Pizza Franchise Cost?

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From its beginnings in 1960, when two brothers borrowed $500 to buy an existing pizza place in Ypsilanti, Michigan, Domino’s Pizza has exploded into the world’s most recognizable brand in its class.  Although the company did not invent the concept of pizza delivery, it has perfected it and today even embraces the Internet to help hungry customers order and track their purchases online.  The first franchise store opened in 1967.  Co-founder Tom Monaghan ran the company until 1998, when he sold all but seven percent of his ownership stake to a prominent venture capital firm.

Domino’s Pizza Franchise Review

There are nearly 4,600 Domino’s Pizza franchises in the United States and another 3,500 in foreign countries.  The company claims to sell more than a million pizzas a day system-wide, while its drivers cover approximately 10 million miles a week.  Worldwide sales in 2008 topped $5.53 billion (an increase of 2.4 percent over the previous year), and a Domino’s Pizza location can be found in more than 50 countries.  The company has made a name for itself by developing interesting twists to its standard pizza fare, such as offering customers three different choices in crust thickness, or crust that is infused with mozzarella cheese, and it has added menu items over the years such as bread sticks and chicken wings.  This latter item has proved so popular that many Domino’s Pizza franchise stores sport an additional “Wing Street” neon sign alongside the ubiquitous red-white-and-blue domino-centric logo.

Domino’s Pizza Franchise Information & Costs

This pizza chain has one of the most innovative cost-to-entry programs in the franchising field, and certainly for a company with such high name recognition.  There are actually two classes of franchisees, designated as “internal” and “external.”  External franchisees are people who have prior business management experience but are new to the Domino’s Pizza concept.  Their franchise fee is set at $25,000.  In order to qualify as an internal franchisee, you must have held the position of general manager in an existing Domino’s Pizza location for a minimum of one year.  With that experience under your belt, you qualify for a special franchise fee rate that can be discounted further if you belong to a certain societal segment – specifically females, minorities, and armed forces veterans.  The latter group is give an automatic $20,000 discount on the franchise fee, and you may even qualify for a complete fee write-off if you belong to two or more of the aforementioned groups.  Your total investment to open a Domino’s Pizza franchise will range from around $140,000 to more than $400,000.  The difference from the lower to higher number reflects a variety of options and the cost of owning or leasing space in your particular town.  Some locations offer delivery and pickup only, while others have dining rooms to accommodate eat-in visitors.  The company also assesses an annual royalty of 5.5 percent on each store’s gross sales.

Commitment to Excellence

More than 90 percent of current Domino’s Pizza operators learned the business from the inside out.  In other words, nearly all were “internal” franchisees.  This company is one of the few in its field to actively encourage existing employees to eventually move on and own their own store.  In addition to spending at least a year as a GM, one only needs around $30,000 in ready cash plus a solid credit rating and a good driving record.  It is estimated that 93 percent of the American population eats at least one pizza a month, and studies show that pizza consumption actually increases during tougher financial times.  The company boasts a solid reputation for its management-training program, and it also figures prominently in charitable giving.  Prominent among the corporation’s favorite recipients is St. Jude’s Children’s Research Hospital, and franchisees are encouraged to donate to their local charities and civic organizations.

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One Response to “How Much Does a Domino’s Pizza Franchise Cost?”

  1. Jorge Alvarado Says:

    I want to open a Dominos Pizza franchise in my home town.

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