Has Pizza Peaked? Domino's Leader Steps Down Following Move Towards Chicken.

A boss of Domino's Pizza Group who proposed the UK might have hit pizza saturation while expanding the franchise into poultry items has been removed after tensions with its directors.

Leadership Change

Rennie is leaving after only 24 months in the top role, and will be replaced on an acting basis by the company's operations head, Frampton, while the pizza giant seeks a new leader.

Rennie, who was with the company for a substantial period, had aimed to redirect Britain's largest pizza takeaway chain towards fried chicken, commenting earlier this month there was not “massive growth” left in the UK's pizza market. He said chicken was the most rapidly expanding menu item in the international market.

Governance Friction

Sources suggest that there was tension between the CEO and the governance team over his approach and management style, although Domino's announcement said he was leaving “by mutual agreement”.

New Brand Launch

In the autumn, Domino's introduced its chicken-focused offering – which the former chief called a “significant new phase” for the company – and is piloting it in select stores in the North West region and Northern Ireland.

While the firm is still planning to expand it across its almost 1,400 stores in the coming year as planned, it views chicken products as complementary to its primary pizza operations.

Leadership Comment

Ian Bull, the Domino's chair, commented: “The board believes that there are a range of possibilities to enhance value and value creation in the main pizza segment. We are concentrating on selecting the suitable leader to direct the careful implementation of that growth strategy.”

Market Difficulties

In the latest update, Domino's, which has 13 million customers in the UK and Ireland, said orders declined by one and a half percent in the Q3. In the summer, it alerted that the quick-service industry had “intensified” as it attributed weaker consumer confidence in the run-up to the government announcement and higher payroll outlays for disappointing revenue and a 15% drop in interim earnings.

Competitors are also experiencing difficulties. Pizza Hut disclosed the closure of multiple locations a recently, after the company behind its outlets faced financial collapse.

Health Initiatives

Adapting to consumer trends towards balanced diets, the company has rolled out lower-calorie options, such as its light base line of pizzas below 400 kcals as well as plant-based and gluten-free options. A large pepperoni pizza has 2,311 kcals. A big margherita has over 2,100, while a personal has 909 kcal.

Acting Management

Nicola Frampton has been with Domino's since the recent past, and was formerly with the gaming group William Hill. It is believed that she prefers not to take on the chief executive role long-term.

Frampton stated: “The company has a number of ongoing expansion and operational projects that we will be concentrating on carrying out at a rapid rate.”

Frampton noted these involved further work on the company's logistics network and menu innovation, and its customer retention initiative.

Domino's is also in need of a permanent finance director until the spring, when a new appointee comes aboard from the drinks company C&C Group. Until then, Richard Snow serves as temporary CFO.