Domino's Is Facing a Major Crisis Right Now

Domino's, the largest pizza chain in the world, experienced a boom during the early days of the pandemic like many of its competitors, but that is starting to fade away thanks to a surprising reason. There are not enough drivers to deliver their pizzas. The issue is such a problem that Domino's saw its first decline in sales during a fiscal quarter in 10 years.

Back in October, Domino's reported a 1.9% decline in same-store sales over the previous three months, reports Insider. This came after the company's fortunes skyrocketed during the pandemic, as same-store sales climbed 10% in the second, third, and fourth quarters of 2020. CEO Richard Allison didn't blame the dip shown in the latest report on a sudden decrease in demand. Instead, he told investors that staffing "has been a challenge." Allison explained that deliver drivers were the company's biggest needs, reports Bloomberg. With fewer drivers and fewer pizza makers, stores may be forced to cut back on operating hours, resulting in fewer orders.

While Domino's locations search for new drivers, Allison said a short-term solution is reminding customers that they can simply drive to a Domino's and pick up their favorite pizzas themselves. "It's certainly impacted us here at Domino's and broadly across the restaurant industry is one of the tightest labor markets we've seen in a long time. So there are a lot of things we're trying to do... to affect the outcomes here," Allison said on CNBC on Nov. 4, reports PYMNTS. Allison also mentioned this in the call with analysts last month, noting that Domino's will push a car-side delivery program, where a customer can have their pizza brought to their car window.

Although the latest earnings report did show a dip in sales, Domino's is still well above pre-pandemic levels. In the third quarter, same-store sales climbed 15% worldwide over two years. "If you look at both our U.S. and international businesses ... [it's a] significantly larger business than we had a couple of years back," Allison said on CNBC.


This all leads to some confusing headlines. On one end, the price of shares continues to fall. By Wednesday afternoon, it was down over 2.09%. On the other hand, there are local reports like one on Tuesday from Huston, where Domino's is looking to fill 550 part-time and full-time positions, including 500 delivery drivers. "We know people are looking to get back into the workforce," Marvin Villanueva, Domino's director of corporate operations in Texas, told the Houston Chronicle. The company offers flexibility and benefits "for people who may just need a part-time gig or those that want to start a new career," Villanueva added. Wall Street insiders might be selling off Domino's stock, but one thing remains true: people still want their pizza, and fast.