Domino's Unseats Pizza Hut as Biggest Pizza Chain
Domino's Pizza finally has the title it has been hungering for: top pizza seller.
The chain wasted no time crowing about unseating Pizza Hut as the leading pizza chain both in the U.S. and worldwide. Domino's not-so-subtly inserted the phrase "the largest pizza company in the world based on global retail sales" into the very first sentence of today's fourth-quarter earnings release.
Domino's says its global retail sales exceeded $12.2 billion in 2017. Pizza Hut, owned by Yum Brands, earlier this month reported global system sales of $12.03 billion (see graphic, below).
Although Domino's sales lead isn't enormous, the chain was very clear that it really, really wants to be seen as the top dog. And it was quick to point out that it plans to exert some power with its new leadership role.
"Our terrific procurement team may have made sure that all of our supply partners are aware of the fact that we are the largest and expect to be treated that way. So, scale matters and the fact that we're now the largest globally and in the U.S. in the pizza industry matters and clearly, we're going to press that with our partners," CEO J. Patrick Doyle said in response to an analyst's question on Tuesday's quarterly conference call.
Domino's fourth-quarter sales at U.S. pizza shops rose 4.2 percent -- and that's after half a percentage point was shaved off, the chain says, because New Year's Day, one of the top few days for pizza orders, wasn't part of Domino's fourth quarter as it was in 2016. (The company's fiscal year closed Dec. 31, 2017, versus Jan. 1, 2017 a year earlier.)
By comparison, Pizza Hut U.S. same-store sales rose 2 percent in the quarter. Overall, Domino's gains have been loftier of late: its 4.2 percent fourth-quarter rise comes on top of a sales rise of 12.2 percent for the fourth quarter of 2016.
While Domino's now holds the top sales spot, Pizza Hut still has a lead in the number of locations. There were 16,748 Pizza Hut locations globally at the end of 2017, versus 14,856 Domino's shops.
The first Pizza Hut restaurant opened in 1958 in Wichita, Kansas. Two years later, brothers Tom and James Monaghan bought a Ypsilanti, Michigan, pizza restaurant called DomiNick's. The name changed to Domino's Pizza in 1965.
Charts by Chen Wu/Ad Age