Since its founding in 1960, Domino’s Pizza Inc. has built a reputation around quick delivery to retail customers who place orders online or via phone for home delivery. Last week it announced a new e-commerce operation designed to more quickly and easily get new pizza materials and store equipment—a business that accounts for a large part of its total revenue—to some 4,700 restaurants operated by independent franchisees across North America.
The pizza chain said it had deployed cloud-based e-commerce and order management applications that have cut the time it takes franchise restaurant managers to order equipment and supplies to hours or even minutes from what had been as long as weeks under a manual ordering system based on phone and fax. “We are well known for using innovative technologies to enhance our customer experience, but what we do for our franchisees is equally important,” says Kevin Vasconi, the restaurant chain’s executive vice president and chief information officer.
Domino’s worked with technology consulting firm Capgemini to deploy a business-to-business e-commerce portal and an order management system from the SuiteCommerce family of software from NetSuite Inc. The systems went live last December, enabling franchise managers to order online products ranging from pizza ovens to car-top Domino’s delivery signs and employee uniforms. Domino’s also operates in-house enterprise resource planning, or ERP, software to manage other operations.
David Pentescu, a principal of Capgemini involved with the Domino’s project, says the order management system can route orders placed on the B2B portal to a Domino’s warehouse or to a manufacturer or distributor who will drop ship an order directly to a Domino’s retail location. The order management system also automatically updates information on the availability of equipment and supplies displayed on the e-commerce portal. “In the past, you picked up the phone or used fax to place an order with a sales rep, who would then look up stock availability, check shipping times, and get back to you,” Pentescu says.
That process could take as long as weeks because of the difficulty in tracking down the right personnel and information on the availability of particular products that might be located in a Domino’s warehouse or at one of its suppliers’ facilities, he adds.
The importance of selling products to franchise operations was underscored in the restaurant chain’s financial report for its first fiscal quarter ended March 22, 2015. Revenue from its supply chain category—the business of selling equipment and supplies to franchisees—accounted for 62.1% of total revenue, or $311.66 million out of $502.03 million.
Domino’s isn’t saying how much of its supply chain business is now being processed through e-commerce—Pentescu notes that some of the approximately 1000 independent franchisees Domino’s works with in North America may still prefer to order via phone and fax for a while—but the company says that the e-commerce ordering system will play a key role in growing its franchise operations.
“We are significantly improving the efficiency, availability and functionality of our franchisee ordering system, ultimately providing an improved experience for our franchise partners and a platform for Domino’s to drive future growth opportunities,” Vasconi says.
Domino’s also did not comment on whether it will also offer an e-commerce ordering technology for its foreign locations. The 4,700 North American franchise locations accounted for 40% of the 11,739 Domino’s locations worldwide as of the end of last year, but they accounted for 170% more first quarter retail sales—$61.77 million to $36.22 million. Domino’s doesn’t break out its supply chain sales by region.
Pentescu adds that the B2B e-commerce portal was configured to meet the particular needs of Domino’s restaurant managers, such as arranging displays of commonly used restaurant materials for quick re-ordering and including workflow features for routing B2B orders to franchise owners or supervisors for approval.
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