Question

What are the most significant internal risks to Domino's Pizza Financial performance? Give evidence to support your answer. For example, is the company vulnerable to technological changes or cyberattacks?

Answer 1

In my opinion, following are the most significant internal risks to Domino's' future revenues & financial performance:

1. The chain relies heavily on the franchisee model for its operations & growth. The ensuing decentralization reduces senior management oversight considerably & makes quality control difficult.

2. The chain has more take-away outlets than restaurants in quite a few countries, making it less attractive for customers who need a seating arrangement in order to enjoy a quick bite.

3. With the health-conscious population increasing substantially, it is becoming imperative for Domino's to innovate more & introduce healthier menu options.

4. In the wake of intense competition, the chain's growth in key mature markets has stagnated, & it therefore needs new products or new markets (or both) to sustain group revenues/profitability.