Domino’s Pizza leaves Italy in the face of competition from local restaurants

Domino’s Pizza Inc.’s presence in the country that gave birth to pizza proved short-lived as Italians preferred regional restaurants to American imports.

The last of Domino’s 29 branches has closed since the company began operations in the country seven years ago. He borrowed a lot of money with plans to open 880 locations, but when nearby restaurants started providing delivery services during the pandemic, he faced fierce competition and turned to creditors for help after running out of money and skipping payments.

Thanks to a franchise agreement with ePizza SpA, the American company entered Italy in 2015. It intended to stand out by offering a structured national delivery service as well as American-style toppings such as pineapple. In order to transport their products to customers’ homes when restrictions prevented going out to restaurants, conventional pizza producers increased delivery or entered into agreements with third-party services like Deliveroo Plc, Just Eat NV or Glovo , which complicated its ambitious development.

“We attribute the problem to the significantly increased level of competition in the food delivery market with both curated chains and ‘mom and pop’ restaurants delivering food, to services and restaurants reopening post-pandemic and to consumers on the go with revenge spending,” ePizza said in an investor report accompanying its fourth quarter 2021 results.

Officials at Domino’s and ePizza in the United States and Italy did not respond to requests for comment. The 13 Domino’s Italian restaurants still open did not return calls. The company had already reduced its operations in the country since its peak in 2020 and on July 29 it stopped providing delivery through its website.

However, some of the chain’s customers were taken aback by the closures and took to its Italian social media platforms to find out why their calls and purchases weren’t being answered or why their local store had closed.

This came after a court in Milan in April granted the commercial court protection from creditors for 90 days, according to a filing with ePizza. The restrictions, which prohibited creditors from demanding debt repayment or taking assets from the company, ended on July 1. According to the court’s electronic filings or the Italian Chamber of Commerce, there were no new developments in the legal proceedings.

According to the company’s latest audited annual reports, its debt at the end of 2020 was €10.6 million ($10.8 million).

Gladys T. Hensley