On October 14, Domino’s China hit a record high in revenue growth. In the first half of 2022, the company amassed a whopping 909 million RMB ($126 million), an increase of 18.6% from 767 million RMB ($106.6 million) in the first half of 2021.
According to Domino’s China CEO Aileen Wang, the brand’s milestone has been driven by “development acceleration, digital leadership, delivery excellence and delicious pizza at value”.
In terms of accelerated development, Domino’s China has been focused on increasing the amount of stores throughout the nation. In fact, from 2019 to 2021, the number of Domino’s China locations jumped from 188 stores to 468 stores. As of June 2022, the total count stands at 508 stores.
Apart from store expansion, an increased emphasis on takeout has played a major role in the company’s spike in revenue growth. During the pandemic, Domino’s carried out its “30-minute delivery promise” service, which became a big selling point for the company. In 2021, delivery orders alone generated more than 73% of revenue.
While Domino’s China’s revenue has been steadily increasing over the years, net losses have reached as much as 471 million RMB ($65 million). For the past three consecutive years, the pizza giant has been struggling to pay hefty headquarter fees as well as packaging costs for its takeout services.
At present, Domino’s is betting on economies of scale for its China strategy. Looking forward, the pizza chain giant plans to open 120 stores in 2022 and 180 new stores in 2023 in first and second-tier cities such as Guangzhou and Shenzhen.
Overall, Domino’s record growth in revenue serves as a milestone for the multinational pizza chain. However, in the face of challenging net losses, Domino’s China still needs time to prove the effectiveness of its long-term strategy.
