For the first time in a decade, Domino’s sales slip in the same store
ANN ARBOR, Mich. (AP) – Domino’s, a seemingly pandemic-tailored company, has not been spared a phenomenon that is haunting almost every employer this summer: a severe labor shortage.
The world’s largest pizza chain was a star on Wall Street that year. Revenues soared as millions took shelter at home and ordered loads of pizza.
Investors sent company shares to unprecedented heights in the summer.
However, on Thursday, Domino’s Pizza Inc. announced for the first time in more than a decade that sales at established stores were going in the wrong direction, declining 1.9% in the third quarter. During the same three month period last year, comparable store sales rose an unprecedented 17.5%.
The company also cited the phasing out of U.S. pandemic aid funds last quarter, but the company’s Ann Arbor, Michigan focus is on finding enough people to keep the cake flowing.
Domino’s has taken steps to attract chefs, drivers, and cashiers, but delivery times have increased, a potentially dangerous trend in an environment of fierce competition with delivery apps like DoorDash and Uber Eats.
“We believe that recruiting could remain a major challenge in the short term as the job market evolves,” Allison said Thursday.
However, staff shortages are widespread and affect retail stores, fast food restaurants and factories.
Many economists still believe that most of the roughly 3 million people who have lost their jobs and stopped looking for work since the pandemic outbreak will resume their searches when COVID-19 releases its grip. After the 2008-2009 recession, it took years for the proportion of people working or looking for work to return.
The job search website Indeed.com currently lists 14,558 jobs in the US Domino stores.
In a recent report, the National Restaurant Association said U.S. restaurant employment hit 11.3 million in July, still a million less than before the pandemic.
The businesses owned by Domino’s have improved pay and benefits to attract workers. But the vast majority of the company’s U.S. branches are operated by franchisees who set their own wage rates.
Allison also said the company is trying to make its job easier and more attractive. For example, it tries to keep drivers more on the road so they can get more tips.
But there are factors that are beyond the company’s control, Allison said. The pandemic, for example, has choked immigration and he hopes that will ease at some point.
“We need more immigration to keep our workforce resilient,” said Allison.
Domino’s revenue rose 3% to $ 997.9 million in the third quarter, just below Wall Street projections.
Domino’s shares rose 2% on Thursday.