Domino's makes tasty pizza at low prices — but why is it so cheap? Could there be
a darker side to the company's business practices? Keep watching to find out.
While it's not the healthiest meal in the world, there's something truly satisfying
about ordering a big, greasy pizza. And the best thing is, they're usually pretty affordable, too.
According to Fast Food Menu Prices, the average price of a Domino's large cheese pizza is $9.99,
with the chain frequently offering deep discounts and deals that lower the price even further.
Jenny Fouracre, Domino's director of public relations, told The Los
Angeles Times in 2015 that the amount charged for a single pizza can vary based on
where you're ordering and what the franchise owners choose to set the price at. However,
national discounts and coupons tend to keep costs relatively similar across state lines.
With deals this good, you have to wonder: how does Domino's keep serving such affordable pizza?
Well, it appears that workers are shouldering much of the burden of Domino's low prices,
with HuffPost reporting in 2016 that the pizza industry is one of the biggest
offenders when it comes to low wages.
In 2016, a lawsuit filed by the New York attorney general accused Domino's
of fraud and systematic wage theft by repeatedly shortening workers' pay.
The lawsuit alleged that Domino's headquarters instructed franchise owners to purchase the
software system PULSE for payroll, which led to them shorting workers on wages.
Domino's headquarters allegedly knew about the issue, but deemed it a "low priority."
"33 out of the 42 reported paying their workers
wages that were below the minimum wage. This is in their own payroll records."
Franchise owners have also claimed they've been hit by the company's push for lower prices,
with one Domino's franchisee telling Australia's News.com in 2018 that the reduction of prices
around 2014 began cutting into profits and forcing shops to sell pizzas at or below cost.
Many of those who opened shops before the price cuts had to close up,
claiming the hard work and time they were putting into building their businesses
wasn't making sense given the debt they were building from the costs.
At the time, they were told the price cuts were a temporary promotion,
but it quickly became clear to them that these deep discounts were here to stay.
A Domino's spokesperson told a reporter for the website that,
since introducing a value deal in Australia, stores had seen increased profits and sales.
How else does Domino's make its money back?
While the chain offers a number of well-known money-saving promotions, there are plenty of
other items on the restaurant's menu that come at a significant markup.
For example, soda and bottled water are two of the restaurant food items with the highest markups;
if you're ordering drinks for everyone along with your pizza, the cost can add up quickly.
Combine that with the other "extras" on the Domino's menu, such as sides,
desserts, salads, and even pasta, and it's not hard to see how your bill can add up fast.
And that's not including the additional dipping cups, grated cheese, and crushed
red pepper you're likely adding to your pizza order — those all cost money, too.
And then there's the ingredients. Buying ingredients in bulk is a key success factor
for many chain restaurants, and Domino's is no different. According to a report from Quartz, the
Connecticut facility that supplies Domino's with its dough balls is a "hyper-efficient" operation,
which helps keep production costs down. The outlet explains that the facility
makes 500 pounds of pizza dough every five minutes, all for Domino's — and it
runs on a 24/7 operating timeline. Larry Manning, director of the facility, said:
"In the supply chain world, we're rocking, we're pretty cool. We've got our own fleet,
we've got our own drivers, we go in the dead of night, the biggest storms."
In addition to its time-saving dough production process, Domino's also uses the same pizza cheese
as Pizza Hut and Papa John's. Leprino Foods provides mozzarella for all three pizza chains,
although Domino's pizza sauce options appear to be unique.
At the end of the day, it really doesn't take a comprehensive understanding of
Domino's business practices to appreciate the price points of the chain's pizzas.
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