1 00:00:05,680 --> 00:00:08,080 Speaker 1: Welcome to the Fear and Greed Business Interview. I'm Sean 2 00:00:08,080 --> 00:00:12,120 Speaker 1: Alam something a little different today. In October twenty twenty, 3 00:00:12,119 --> 00:00:14,880 Speaker 1: in the midst of the pandemic and lockdowns, I spoke 4 00:00:14,920 --> 00:00:18,440 Speaker 1: with Domino's CEO Don May. Don spoke with me from 5 00:00:18,520 --> 00:00:22,280 Speaker 1: Hotel Quarantine, having made a very rare trip overseas. This 6 00:00:22,360 --> 00:00:26,079 Speaker 1: interview is really a snapshot of that time. Domino's share 7 00:00:26,079 --> 00:00:28,920 Speaker 1: price was flying and the company was having great success 8 00:00:29,360 --> 00:00:33,280 Speaker 1: expanding into international markets like Japan and Europe. The share 9 00:00:33,280 --> 00:00:35,080 Speaker 1: price has come back a long way since then, and 10 00:00:35,120 --> 00:00:37,479 Speaker 1: obviously the pandemic is well behind us now. But this 11 00:00:37,600 --> 00:00:41,560 Speaker 1: interview is a terrific insight into the Domino story, how 12 00:00:41,600 --> 00:00:44,120 Speaker 1: Don may rose to the role of CEO and his 13 00:00:44,240 --> 00:00:47,159 Speaker 1: lofty goals for the company. I hope you enjoy it 14 00:00:53,400 --> 00:00:55,400 Speaker 1: this morning. I'm delighted to welcome to Fear and Greed, 15 00:00:55,440 --> 00:00:59,160 Speaker 1: Chief executive Officer of Domino's Don may Good morning, Don. 16 00:00:59,080 --> 00:01:00,480 Speaker 2: Good morning to be here. 17 00:01:00,840 --> 00:01:03,400 Speaker 1: Now tell us about the history of Dominoes in Australia. 18 00:01:03,560 --> 00:01:04,679 Speaker 1: What's the Domino story. 19 00:01:05,120 --> 00:01:08,920 Speaker 2: Yes, so, Dominoes in its early years struggled internationally, very 20 00:01:09,000 --> 00:01:12,320 Speaker 2: very US centric and like a lot of international businesses, 21 00:01:12,600 --> 00:01:15,160 Speaker 2: which in fact we learned from when we finally went international, 22 00:01:15,680 --> 00:01:18,640 Speaker 2: just didn't really understand the Australian consumer, and so it 23 00:01:18,880 --> 00:01:22,640 Speaker 2: arrived here in the eighties and we acquired the business 24 00:01:22,680 --> 00:01:25,679 Speaker 2: in ninety three, so we were a little Brisbane company 25 00:01:25,720 --> 00:01:29,440 Speaker 2: called Silvio's Dollar Pizza and the owners of Silvio's acquired 26 00:01:29,440 --> 00:01:32,679 Speaker 2: Dominos out of its third liquidation in Australia ninety three 27 00:01:33,080 --> 00:01:35,520 Speaker 2: and we built the business from there and have now 28 00:01:35,560 --> 00:01:38,840 Speaker 2: taken it globally ironically as an ASX listed company with 29 00:01:39,560 --> 00:01:40,559 Speaker 2: the US brand. 30 00:01:40,760 --> 00:01:43,800 Speaker 1: So over that twenty seven years you acquired stores and 31 00:01:43,840 --> 00:01:46,280 Speaker 1: then opened your own stores under the Domino's brand. Is 32 00:01:46,280 --> 00:01:47,680 Speaker 1: that how it worked? Yeah, So what. 33 00:01:47,680 --> 00:01:50,440 Speaker 2: Happened is that ninety three we still ran the two 34 00:01:50,440 --> 00:01:53,160 Speaker 2: businesses separately. For two years, I actually ran Dominos and 35 00:01:53,200 --> 00:01:56,320 Speaker 2: the founders of Silvio's ran Silvio's. We couldn't run two 36 00:01:56,360 --> 00:01:59,480 Speaker 2: separate brands, so finally in ninety five we made the 37 00:01:59,520 --> 00:02:02,520 Speaker 2: decision to go with what was actually the smallest business 38 00:02:02,560 --> 00:02:06,040 Speaker 2: in Australia and historically being the loser, but we converted 39 00:02:06,080 --> 00:02:08,720 Speaker 2: our Australian business to Dominos because we really realized that 40 00:02:08,760 --> 00:02:10,799 Speaker 2: there was a lot of global insights from Dominoes and 41 00:02:10,840 --> 00:02:13,120 Speaker 2: being part of the global family would take us to 42 00:02:13,160 --> 00:02:16,560 Speaker 2: another level. Then with our own Australian insights of running 43 00:02:16,560 --> 00:02:18,640 Speaker 2: a business in Australia. You know a lot of people 44 00:02:18,680 --> 00:02:21,000 Speaker 2: don't realize, but Australia doesn't have a third workforce like 45 00:02:21,040 --> 00:02:22,920 Speaker 2: most other countries around the world. You know, we're a 46 00:02:23,000 --> 00:02:26,880 Speaker 2: very socialized labor force and therefore its you know, we 47 00:02:27,400 --> 00:02:28,960 Speaker 2: through training and so on, we get a whole different 48 00:02:28,960 --> 00:02:32,680 Speaker 2: productivity model, taste buds for Australians and are very different 49 00:02:32,680 --> 00:02:35,000 Speaker 2: to Americans, which may surprise us a little bit, but 50 00:02:35,040 --> 00:02:38,240 Speaker 2: you know because of our eighth centric rather than Hispanic centric. 51 00:02:38,320 --> 00:02:40,240 Speaker 2: So there's all these sort of different insights with product 52 00:02:40,280 --> 00:02:44,760 Speaker 2: with running teams that the Australian knowledge us brand and 53 00:02:45,639 --> 00:02:48,440 Speaker 2: we took on pizzaart in those early days, sure did. 54 00:02:48,480 --> 00:02:50,959 Speaker 1: And in the end you've grown to be much larger 55 00:02:50,960 --> 00:02:52,680 Speaker 1: than most of your competitive in fact, all of your 56 00:02:52,880 --> 00:02:56,120 Speaker 1: competitors in your market. Why do you think Dominos is 57 00:02:56,160 --> 00:02:58,480 Speaker 1: so successful? Is there one thing you can put your 58 00:02:58,480 --> 00:02:58,840 Speaker 1: finger on? 59 00:02:59,240 --> 00:03:03,079 Speaker 2: Yeah, where obsessed with the value equation for customers and 60 00:03:03,120 --> 00:03:05,560 Speaker 2: it's all about the customer. So we're obsessed with listening 61 00:03:05,560 --> 00:03:08,320 Speaker 2: to the customer. And the way we talk about value 62 00:03:08,400 --> 00:03:10,960 Speaker 2: is that it's product, so that in the quality of 63 00:03:10,960 --> 00:03:14,400 Speaker 2: the product, the service, and the image divided by the price. 64 00:03:14,560 --> 00:03:17,440 Speaker 2: So the better the product versus the price or the 65 00:03:17,440 --> 00:03:19,960 Speaker 2: service of the image, then the better the value. And 66 00:03:20,000 --> 00:03:23,000 Speaker 2: that we work on that equation permanently. So we're always 67 00:03:23,000 --> 00:03:24,760 Speaker 2: trying to think of how do we make our product better, 68 00:03:24,840 --> 00:03:28,360 Speaker 2: our services better, which tobay often comes with technology the 69 00:03:28,400 --> 00:03:30,440 Speaker 2: image of the brands, So the image both with the 70 00:03:30,480 --> 00:03:34,239 Speaker 2: way our team members engage or our stores or our websites, 71 00:03:34,560 --> 00:03:37,080 Speaker 2: and all of that gets packaged up into the value 72 00:03:37,080 --> 00:03:40,840 Speaker 2: equation and it's all driven with an obsession around the customer. 73 00:03:41,280 --> 00:03:43,880 Speaker 1: Okay, now I've spoken to you before and you talk 74 00:03:43,880 --> 00:03:46,360 Speaker 1: about the time to deliver a pizza. You need a 75 00:03:46,360 --> 00:03:49,080 Speaker 1: great pizza, but also the importance of getting it to 76 00:03:49,160 --> 00:03:51,080 Speaker 1: the customer quickly. Can you explain that a bit. 77 00:03:51,400 --> 00:03:54,320 Speaker 2: Yeah, So we use the phrase internally that time is 78 00:03:54,320 --> 00:03:56,280 Speaker 2: the enemy of food, and that is that as soon 79 00:03:56,280 --> 00:03:59,280 Speaker 2: as a product is freshly produced in any kitchen, it 80 00:03:59,360 --> 00:04:01,920 Speaker 2: starts to quite quickly, you know, by the second and 81 00:04:02,560 --> 00:04:04,600 Speaker 2: so we're obsessed with getting it from out of the 82 00:04:04,640 --> 00:04:07,720 Speaker 2: oven and into the customer's hands as quickly and as 83 00:04:07,760 --> 00:04:10,760 Speaker 2: safely as possible. So we have a project called Project 84 00:04:10,760 --> 00:04:13,040 Speaker 2: three ten, which is the ultimate goal for all of 85 00:04:13,040 --> 00:04:15,720 Speaker 2: our stores globally to deliver in under ten minutes. We 86 00:04:15,800 --> 00:04:17,400 Speaker 2: have a number of stores around the world who do 87 00:04:17,440 --> 00:04:20,160 Speaker 2: that consistently now already. And when we started this project, 88 00:04:20,200 --> 00:04:22,480 Speaker 2: just to put into perspective, our average delivery times used 89 00:04:22,480 --> 00:04:24,520 Speaker 2: to be twenty five to twenty eight minutes around the world. 90 00:04:24,720 --> 00:04:27,360 Speaker 2: We now have a store The world record for our 91 00:04:27,400 --> 00:04:31,280 Speaker 2: company is out of a store in Tokyo, Japan, with 92 00:04:31,520 --> 00:04:35,600 Speaker 2: two minutes and twenty seven for all week freshly made. 93 00:04:35,640 --> 00:04:38,440 Speaker 2: And this is what really startles people is that you 94 00:04:38,480 --> 00:04:41,760 Speaker 2: can make one point two billion variations of the Domino's pizza, 95 00:04:42,240 --> 00:04:44,479 Speaker 2: So it's got to be made fresh. There's nothing that's 96 00:04:44,520 --> 00:04:47,840 Speaker 2: pre made. It's fresh dough, it's freshly topped and freshly cooked. 97 00:04:48,040 --> 00:04:49,720 Speaker 2: And we're doing this with a lot of what we 98 00:04:49,760 --> 00:04:52,839 Speaker 2: call co pilots and technologies so that they're giving us. 99 00:04:53,160 --> 00:04:55,440 Speaker 2: You know, we've got faster bake ovens, we're getting smaller 100 00:04:55,480 --> 00:04:58,440 Speaker 2: delivery areas. We have a thing called the future Order screen, 101 00:04:58,480 --> 00:05:01,320 Speaker 2: which when the customer's inside the app, the app's already 102 00:05:01,320 --> 00:05:04,360 Speaker 2: predicting their order and it gets it to about a 103 00:05:04,440 --> 00:05:06,599 Speaker 2: ninety eight ninety nine centacracy, and then we start making 104 00:05:06,640 --> 00:05:09,680 Speaker 2: a baking before the customers even pressed enter, So we 105 00:05:09,760 --> 00:05:11,480 Speaker 2: do We've got a lot of these sort of things 106 00:05:11,480 --> 00:05:11,960 Speaker 2: that we're doing. 107 00:05:12,640 --> 00:05:14,120 Speaker 1: How does that work with the app? How do you 108 00:05:14,120 --> 00:05:18,360 Speaker 1: get a pizza in under three minutes from order to delivery? 109 00:05:18,160 --> 00:05:20,240 Speaker 2: So if you imagine, so if you're in the app, 110 00:05:20,360 --> 00:05:22,919 Speaker 2: takes two three five minutes. You know, as you're playing 111 00:05:22,920 --> 00:05:25,640 Speaker 2: around with your product and manufacture, you're designing your own 112 00:05:25,680 --> 00:05:29,440 Speaker 2: pizzas or your own order, our algorithms already predicting where 113 00:05:29,480 --> 00:05:32,080 Speaker 2: you're going to get to and with AI and then 114 00:05:32,160 --> 00:05:35,400 Speaker 2: we're actually already starting the process of making and baking 115 00:05:35,440 --> 00:05:38,400 Speaker 2: your pizza and it takes you know, freshly made pizza 116 00:05:38,440 --> 00:05:41,159 Speaker 2: takes a couple of minutes. It cooks in about three minutes, 117 00:05:41,200 --> 00:05:43,480 Speaker 2: and then the drive times today are about three minutes. 118 00:05:43,520 --> 00:05:45,920 Speaker 2: So if we can get at advantage there and then 119 00:05:45,920 --> 00:05:48,680 Speaker 2: we've got there's so many other ones. We just launched 120 00:05:48,680 --> 00:05:51,920 Speaker 2: in Australia a piece of technology called call on Arrival 121 00:05:52,480 --> 00:05:55,040 Speaker 2: and what we learned when we're trying to you know, 122 00:05:55,240 --> 00:05:58,240 Speaker 2: crush time is that in a manual process, if we 123 00:05:58,360 --> 00:06:00,280 Speaker 2: called the customer and ask them to meet it at 124 00:06:00,279 --> 00:06:02,880 Speaker 2: the door, then we would save one to three minutes 125 00:06:02,920 --> 00:06:05,080 Speaker 2: because the customer would actually come out and meet us. 126 00:06:05,560 --> 00:06:08,440 Speaker 2: Now you would think SMS or push notification would do 127 00:06:08,480 --> 00:06:10,640 Speaker 2: the same thing, but what we found is a push 128 00:06:10,680 --> 00:06:12,960 Speaker 2: notification is only forty percent accurate. A phone calls almost 129 00:06:13,000 --> 00:06:15,039 Speaker 2: one hundred percentccurate. So now we have a piece of 130 00:06:15,080 --> 00:06:18,120 Speaker 2: AI that when we're two minutes from your home, that 131 00:06:18,240 --> 00:06:20,080 Speaker 2: AI calls you and asks you to come and meet 132 00:06:20,160 --> 00:06:22,160 Speaker 2: us out the front. Well, then once again that saves 133 00:06:22,240 --> 00:06:24,360 Speaker 2: us that one to three minutes, and our customers love 134 00:06:24,400 --> 00:06:27,920 Speaker 2: it because our npscore goes up because they've got a hotter, 135 00:06:27,960 --> 00:06:28,560 Speaker 2: fresh pizza. 136 00:06:28,600 --> 00:06:31,280 Speaker 1: In the end, it's friendly as well, it. 137 00:06:31,320 --> 00:06:32,640 Speaker 2: Is and it is a friendly call. 138 00:06:32,720 --> 00:06:36,080 Speaker 1: You know, you said three minutes delivery time. So part 139 00:06:36,120 --> 00:06:38,159 Speaker 1: of your strategy has been and you've been criticized for 140 00:06:38,200 --> 00:06:41,159 Speaker 1: this at times opening new stores. But the idea behind that, 141 00:06:41,200 --> 00:06:43,719 Speaker 1: presumably is so that you can get that fresh product 142 00:06:43,880 --> 00:06:45,080 Speaker 1: to the customer quicker. 143 00:06:45,279 --> 00:06:49,040 Speaker 2: That's right, it's contradictory. In the age of the Internet, 144 00:06:49,080 --> 00:06:50,240 Speaker 2: a lot of the thought in the age of the 145 00:06:50,240 --> 00:06:51,880 Speaker 2: Internet has been well, surely we're going to go to 146 00:06:51,960 --> 00:06:54,080 Speaker 2: hub and spoke. Surely it's going to be that you 147 00:06:54,160 --> 00:06:56,240 Speaker 2: close down the retail sites and you have just these 148 00:06:56,279 --> 00:06:59,640 Speaker 2: warehouses or you know, in our industry, the dark kitchens. 149 00:07:00,120 --> 00:07:04,320 Speaker 2: But actually the biggest cost of anything for delivery is 150 00:07:04,320 --> 00:07:07,560 Speaker 2: the actual labor cost of the human beings getting that 151 00:07:07,640 --> 00:07:10,720 Speaker 2: product to the customers. That's the largest cost globally for 152 00:07:10,800 --> 00:07:13,640 Speaker 2: us in our business. So by getting the kitchens actually 153 00:07:13,720 --> 00:07:17,320 Speaker 2: closer to the customer, we reduce our biggest cost. And 154 00:07:17,360 --> 00:07:19,720 Speaker 2: we also obviously you know, customers love it, so ours 155 00:07:19,720 --> 00:07:21,880 Speaker 2: sales go up because we're delivering a hotter, fresher pizza. 156 00:07:21,960 --> 00:07:25,400 Speaker 2: So long story short, Yeah, you know, getting these kitchens 157 00:07:25,440 --> 00:07:28,160 Speaker 2: within a three minute radius of every customer in each 158 00:07:28,200 --> 00:07:29,520 Speaker 2: of our countries is our goal. 159 00:07:30,000 --> 00:07:32,120 Speaker 1: And the data what does that show into Because the 160 00:07:32,160 --> 00:07:34,880 Speaker 1: criticism has been around on the franchise e front that 161 00:07:35,000 --> 00:07:37,480 Speaker 1: you're splitting areas, but what's the data show on that. 162 00:07:37,840 --> 00:07:41,239 Speaker 2: Yeah, So the reality is is that we continually show 163 00:07:41,280 --> 00:07:44,440 Speaker 2: that the original store recovers within an eighteen months to 164 00:07:44,480 --> 00:07:46,680 Speaker 2: three year window. And what we do for the franchise 165 00:07:46,880 --> 00:07:49,920 Speaker 2: is we give them royalty and advertising waivers to absolutely 166 00:07:49,960 --> 00:07:53,320 Speaker 2: safety net that. So when we sit with the franchise 167 00:07:53,360 --> 00:07:55,800 Speaker 2: e number one, we can't make an area split. They 168 00:07:55,880 --> 00:07:58,080 Speaker 2: own that territory for ten years, and that's one of 169 00:07:58,120 --> 00:08:01,080 Speaker 2: the other misunderstood things. So it's up to the franchise ease. 170 00:08:01,120 --> 00:08:02,560 Speaker 2: So we come and present them with the data and 171 00:08:02,560 --> 00:08:05,240 Speaker 2: we say, look, there's a viable store. Your store will 172 00:08:05,240 --> 00:08:07,680 Speaker 2: recover in eighteen months to three years. What we'll do 173 00:08:07,800 --> 00:08:10,680 Speaker 2: is will subsidize to make sure that that's safety needed. 174 00:08:10,800 --> 00:08:12,880 Speaker 2: And then you end up with two stores. And in 175 00:08:12,880 --> 00:08:14,560 Speaker 2: the end, the franchisey can either choose to do it. 176 00:08:14,600 --> 00:08:17,040 Speaker 2: They could either sell the territory or choose not to 177 00:08:17,080 --> 00:08:17,560 Speaker 2: do it. 178 00:08:17,680 --> 00:08:20,600 Speaker 1: Their choice. But something I find interesting with Domino's management, 179 00:08:20,920 --> 00:08:24,320 Speaker 1: many of them have actually run pizza places themselves, actual stores. 180 00:08:24,560 --> 00:08:25,000 Speaker 1: That's right. 181 00:08:25,040 --> 00:08:27,080 Speaker 2: I'm my thirty three and a half year veteran now 182 00:08:27,080 --> 00:08:28,720 Speaker 2: and I was a franchise z where I grew from 183 00:08:28,720 --> 00:08:31,320 Speaker 2: one to seventeen stores and use the equity of those 184 00:08:31,320 --> 00:08:33,520 Speaker 2: thoughts to buy part of the company and become the 185 00:08:33,559 --> 00:08:35,679 Speaker 2: CEO back in two thousand and one, in two thousand 186 00:08:35,720 --> 00:08:38,640 Speaker 2: and two, And that's a very common story in that 187 00:08:38,800 --> 00:08:41,640 Speaker 2: many of our CEOs and even other parts of our 188 00:08:41,720 --> 00:08:46,120 Speaker 2: team are our best franchisees who we've recruited internally, and 189 00:08:46,160 --> 00:08:48,920 Speaker 2: they may have rolled up their value and their business 190 00:08:48,960 --> 00:08:50,520 Speaker 2: into equity or they may have taken them money off 191 00:08:50,559 --> 00:08:52,920 Speaker 2: the table. That's their choice. The benefit of that is 192 00:08:52,960 --> 00:08:56,600 Speaker 2: the number one is the empathy because we're franchised. People 193 00:08:56,640 --> 00:09:00,920 Speaker 2: didn't let business and the empathy that that are franchised 194 00:09:01,880 --> 00:09:04,400 Speaker 2: coming to our leadership team has his extraordinary They've walked 195 00:09:04,400 --> 00:09:07,320 Speaker 2: in the same shoes, but are also they're best s franchises. 196 00:09:07,400 --> 00:09:10,079 Speaker 2: So our best frand disease have proven people developers, that 197 00:09:10,240 --> 00:09:13,240 Speaker 2: great marketers. They understand finance and p and ls and 198 00:09:13,280 --> 00:09:16,000 Speaker 2: balance sheets, so they're more rounded and developed even though 199 00:09:16,040 --> 00:09:19,479 Speaker 2: they were small business owners. In fact, running a Domino's 200 00:09:19,559 --> 00:09:23,040 Speaker 2: country is like running a Dominoes franchise, and you just 201 00:09:23,080 --> 00:09:24,880 Speaker 2: got to do it on a bigger scale. And obviously 202 00:09:24,960 --> 00:09:26,920 Speaker 2: the public company side of it as well, that they 203 00:09:26,960 --> 00:09:27,440 Speaker 2: have to learn. 204 00:09:34,800 --> 00:09:36,680 Speaker 1: The last few years, you've really moved off shore into 205 00:09:36,720 --> 00:09:39,000 Speaker 1: Europe in Japan. I suppose a couple of things. There 206 00:09:39,320 --> 00:09:42,559 Speaker 1: is the Australian market saturated yet and then why did 207 00:09:42,600 --> 00:09:43,199 Speaker 1: you go offshore? 208 00:09:43,720 --> 00:09:46,240 Speaker 2: It's so interesting. When we listed the business, we thought 209 00:09:46,280 --> 00:09:48,679 Speaker 2: we would run out of feed in Australia. Well, you know, 210 00:09:48,720 --> 00:09:51,480 Speaker 2: well earlier and we still haven't where you know, the 211 00:09:51,880 --> 00:09:54,319 Speaker 2: data still shows that there's that there should be two 212 00:09:54,400 --> 00:09:56,760 Speaker 2: hundred stores between Australia and New Zealand over the next 213 00:09:56,760 --> 00:10:00,199 Speaker 2: five years. And that still would make us small, all 214 00:10:00,200 --> 00:10:03,280 Speaker 2: of them maturely smaller than McDonald's or KFC or Subway, 215 00:10:03,320 --> 00:10:05,440 Speaker 2: believe it or not. So we'd still be only the 216 00:10:05,520 --> 00:10:08,360 Speaker 2: fourth largest spast food company in Australia with twelve hundred 217 00:10:08,400 --> 00:10:11,080 Speaker 2: stores in Australian Zealand. But you know, in the early days, 218 00:10:11,080 --> 00:10:13,480 Speaker 2: we thought, will we'd be in Australian only business with 219 00:10:13,640 --> 00:10:16,080 Speaker 2: five or six brands, or should we go sure? Are 220 00:10:16,080 --> 00:10:19,079 Speaker 2: we really good at dominos? And we originally went into Europe. 221 00:10:19,160 --> 00:10:22,480 Speaker 2: We now have five countries in Europe. We're now in Japan. 222 00:10:23,440 --> 00:10:25,120 Speaker 2: And the really interesting thing is, you know, in my 223 00:10:25,200 --> 00:10:26,880 Speaker 2: early days I used to have two mbes of the 224 00:10:26,920 --> 00:10:29,120 Speaker 2: world for the rest of the Domino's businesses. Is that, 225 00:10:29,160 --> 00:10:31,280 Speaker 2: you know, the population was smaller in Australian New Zealand 226 00:10:31,320 --> 00:10:33,679 Speaker 2: and the Aussie dollar was all over the shop. Well, 227 00:10:33,720 --> 00:10:36,920 Speaker 2: today we service three hundred and forty million people. That's 228 00:10:36,960 --> 00:10:39,360 Speaker 2: more population in the US and when you combine those 229 00:10:39,440 --> 00:10:42,679 Speaker 2: nine countries together, they have a GDP larger than China. 230 00:10:42,960 --> 00:10:46,760 Speaker 2: So we have this incredible opportunity now in what are 231 00:10:46,800 --> 00:10:49,840 Speaker 2: the unloved economies of the world. You know, most companies 232 00:10:49,840 --> 00:10:51,800 Speaker 2: in the last ten or fifteen years have talked a 233 00:10:51,840 --> 00:10:54,880 Speaker 2: lot about the brick nation, the very romantic merging nations. Well, 234 00:10:54,880 --> 00:10:58,160 Speaker 2: we've gone into some of the most business friendly economies 235 00:10:58,160 --> 00:11:01,600 Speaker 2: in the world, like Japan and Germany and France and 236 00:11:01,640 --> 00:11:04,280 Speaker 2: the Netherlands and the ban Lux and they were the 237 00:11:04,840 --> 00:11:08,640 Speaker 2: least attractive, but yet they're stable, strong economies. Uo yen 238 00:11:09,440 --> 00:11:12,480 Speaker 2: in Europe, very big pizza eating nations. Not so much 239 00:11:12,520 --> 00:11:14,840 Speaker 2: in Japan, but we're educating the Japanese to eat pizza 240 00:11:15,480 --> 00:11:18,360 Speaker 2: and the irony. Today our two fastest growth businesses of 241 00:11:18,440 --> 00:11:20,280 Speaker 2: Japan and Germany, which is what two hundred and ten 242 00:11:20,280 --> 00:11:23,280 Speaker 2: million people, and they are literally the fastest growing by 243 00:11:23,320 --> 00:11:24,320 Speaker 2: far in our business. 244 00:11:24,720 --> 00:11:26,400 Speaker 1: Wow, So how are you doing that in Japan because 245 00:11:26,400 --> 00:11:28,960 Speaker 1: I couldn't imagine that. They certainly don't have a culture 246 00:11:28,960 --> 00:11:29,559 Speaker 1: of eating pizza. 247 00:11:30,559 --> 00:11:33,880 Speaker 2: It's really interesting. We've become fashionable. It's really funny that 248 00:11:33,920 --> 00:11:36,920 Speaker 2: most Austrains would think of dominoes as a brand that's 249 00:11:36,960 --> 00:11:39,280 Speaker 2: been around a while, but in Japan we were just 250 00:11:39,320 --> 00:11:41,640 Speaker 2: in fact, on Sunday night, there was a fifty four 251 00:11:41,720 --> 00:11:44,760 Speaker 2: minute TV program all on just Dominoes in Japan. However, 252 00:11:44,760 --> 00:11:49,120 Speaker 2: that we're bringing on authenticity externally but embracing in a 253 00:11:49,200 --> 00:11:53,440 Speaker 2: Japanese way. And so we've got this Barbell strategy. We're 254 00:11:53,480 --> 00:11:55,920 Speaker 2: on one end, it might surprise austraiins that we sell 255 00:11:55,960 --> 00:11:59,359 Speaker 2: pizzas for fifty or sixty dollars and the very premium 256 00:11:59,360 --> 00:12:02,640 Speaker 2: product quite trow four styles of pizza from one pizza, 257 00:12:02,920 --> 00:12:05,920 Speaker 2: very premium. And on the other end, we've got more 258 00:12:06,440 --> 00:12:09,640 Speaker 2: value kind of product, which is the Japanese we considered 259 00:12:09,679 --> 00:12:14,400 Speaker 2: quite American, so pepperoni, cheese pizzas and simple pizzas. And 260 00:12:14,480 --> 00:12:17,840 Speaker 2: this Barbell strategy means that we're servicing what we call 261 00:12:17,920 --> 00:12:21,600 Speaker 2: meal as a task. So the growing single householders in 262 00:12:21,679 --> 00:12:25,400 Speaker 2: Japan a lot of unfortunately Japan's had a shrinking population 263 00:12:25,480 --> 00:12:29,000 Speaker 2: and aging population. So we're doing quite well with you 264 00:12:29,280 --> 00:12:31,560 Speaker 2: single and dual householders. And on the other end with 265 00:12:31,640 --> 00:12:35,840 Speaker 2: the big premium products we serve as special occasions and fashion. 266 00:12:35,920 --> 00:12:39,360 Speaker 2: I mean a really interesting one is we launched a 267 00:12:39,440 --> 00:12:42,000 Speaker 2: one kilogram of cheese. 268 00:12:42,840 --> 00:12:46,880 Speaker 1: PiZZ that can't be healthy, don well, it's indulgent and 269 00:12:46,920 --> 00:12:48,520 Speaker 1: it's coraordinary. 270 00:12:48,600 --> 00:12:53,800 Speaker 2: We moved the dairy market of Japan with a one 271 00:12:53,880 --> 00:12:58,040 Speaker 2: kilogram cheese pizza and we had to We've relaunched it 272 00:12:58,040 --> 00:13:00,559 Speaker 2: in three different variants since, a seven hundred fifty and 273 00:13:00,559 --> 00:13:03,280 Speaker 2: a five hundred gram and different, you know, but it's 274 00:13:03,320 --> 00:13:07,160 Speaker 2: just so exotic and so so different that in fashionable. 275 00:13:07,200 --> 00:13:11,040 Speaker 2: So long story short, we're on trend and you know 276 00:13:11,200 --> 00:13:11,720 Speaker 2: that's great. 277 00:13:12,000 --> 00:13:14,319 Speaker 1: That's where you want to be. So at Europe and Japan. 278 00:13:14,360 --> 00:13:16,880 Speaker 1: The geography is where you'll get most growth in coming years. 279 00:13:17,160 --> 00:13:18,920 Speaker 2: Yeah. So Australia is ill, still a lot of growth, 280 00:13:18,920 --> 00:13:22,280 Speaker 2: but outstripped now by just clearly population size and scale 281 00:13:22,400 --> 00:13:25,680 Speaker 2: of mainland Europe, and our business is there in the 282 00:13:25,720 --> 00:13:28,520 Speaker 2: new termine, you know, Japan is now we have more 283 00:13:28,559 --> 00:13:30,720 Speaker 2: stores in Japan than in Australia. We just passed that 284 00:13:30,760 --> 00:13:33,160 Speaker 2: in the last month and they're shooting away now. So 285 00:13:33,200 --> 00:13:35,679 Speaker 2: in the next decade Japan will probably become our biggest business, 286 00:13:35,840 --> 00:13:38,120 Speaker 2: then to be eclipsed by Germany in the longer run, 287 00:13:38,640 --> 00:13:41,680 Speaker 2: and only because the Germans eat a lot more pizza, right, 288 00:13:42,040 --> 00:13:45,000 Speaker 2: So yes, coming from further behind. You know, we only 289 00:13:45,040 --> 00:13:47,199 Speaker 2: have three hundred and thirty five stores in Germany right now, 290 00:13:47,240 --> 00:13:50,160 Speaker 2: versus our seven hundred and ten in Japan. But yeah, 291 00:13:50,160 --> 00:13:52,400 Speaker 2: and then of course you've got Fronts and the Benelux, 292 00:13:52,480 --> 00:13:55,280 Speaker 2: which is about the same size as Australian's Zeland population wise, 293 00:13:55,440 --> 00:13:56,600 Speaker 2: has still got a lot of growth. 294 00:13:56,880 --> 00:13:58,800 Speaker 1: So Benelux being Belgium and Luxembourg. 295 00:13:58,880 --> 00:14:03,360 Speaker 2: Is that right, Belgium, the Netherlands and Luxembourg gap right right. 296 00:14:03,760 --> 00:14:06,760 Speaker 2: Originally most of our profit has actually been made by Australia, 297 00:14:06,800 --> 00:14:08,840 Speaker 2: New Zealand and the Benlux which is about you know, 298 00:14:08,960 --> 00:14:12,160 Speaker 2: sixty million population. But now the other two hundred and 299 00:14:12,160 --> 00:14:14,520 Speaker 2: eighty million, which is the bigger business, is now the 300 00:14:14,559 --> 00:14:18,040 Speaker 2: real surging business, which is largely Japan, Germany and Front. 301 00:14:18,280 --> 00:14:20,120 Speaker 1: Yeah. Now, I mentioned in the introduction just how well 302 00:14:20,160 --> 00:14:22,880 Speaker 1: your share price has gone in recent months during the pandemic. 303 00:14:22,920 --> 00:14:25,480 Speaker 1: How have you handled and your staff and your team's 304 00:14:25,480 --> 00:14:26,400 Speaker 1: handled the pandemic. 305 00:14:26,720 --> 00:14:29,000 Speaker 2: You look, I'm really proud Seawan of just how well 306 00:14:29,000 --> 00:14:31,840 Speaker 2: they've done. You know, in that March period, you know, 307 00:14:31,880 --> 00:14:33,600 Speaker 2: we were all deer in the headlights. At one point 308 00:14:33,640 --> 00:14:35,200 Speaker 2: we had the whole of France and the whole of 309 00:14:35,200 --> 00:14:37,600 Speaker 2: New Zealand closed. You know, five hundred and fifty stores 310 00:14:37,920 --> 00:14:40,480 Speaker 2: was out. Two thousand and seven hundred store system going 311 00:14:40,520 --> 00:14:42,760 Speaker 2: to close. How are we going to manage that? And 312 00:14:42,800 --> 00:14:45,120 Speaker 2: so we you know, we literally throughout the budget. We 313 00:14:45,160 --> 00:14:47,280 Speaker 2: threw out all of our TV commercials at the time, 314 00:14:47,560 --> 00:14:50,520 Speaker 2: and we just put people first. We realized that it 315 00:14:50,600 --> 00:14:52,720 Speaker 2: was a privilege to be able to trade, it's not 316 00:14:52,760 --> 00:14:55,440 Speaker 2: a right, which was a learning for us. And because 317 00:14:55,480 --> 00:14:58,360 Speaker 2: we're privileged enough to trade, that that turned us into 318 00:14:58,400 --> 00:15:02,160 Speaker 2: a mission mentality of our safety for our team members, 319 00:15:02,160 --> 00:15:05,120 Speaker 2: safety for our customers, and then also the generosity that 320 00:15:05,360 --> 00:15:07,840 Speaker 2: if we were privileged enough to be open, the number 321 00:15:07,880 --> 00:15:10,720 Speaker 2: one let's be generous, so let's continue to give. You know, 322 00:15:10,720 --> 00:15:12,000 Speaker 2: there were a lot of people on the front line. 323 00:15:12,040 --> 00:15:15,320 Speaker 2: We've donated hundreds and hundreds of thousands of pizzas now 324 00:15:15,600 --> 00:15:18,760 Speaker 2: and we continue to do that, raise money where those 325 00:15:18,800 --> 00:15:21,400 Speaker 2: that are need raising, you know, because we're trading and 326 00:15:21,440 --> 00:15:23,720 Speaker 2: so many other people aren't or under trading or out 327 00:15:23,720 --> 00:15:26,760 Speaker 2: of jobs. We've hired a lot of people. We hired 328 00:15:26,800 --> 00:15:29,400 Speaker 2: thirteen thousand additional team members in the first four or 329 00:15:29,400 --> 00:15:32,440 Speaker 2: five months, will probably hire somewhere between ten and fifteen 330 00:15:32,440 --> 00:15:36,600 Speaker 2: thousand between now and Christmas. So material you know, we're 331 00:15:36,600 --> 00:15:39,560 Speaker 2: adding jobs where possible, don't take government support if we're 332 00:15:39,600 --> 00:15:41,560 Speaker 2: privileged up to trade. So as a company, you know, 333 00:15:41,640 --> 00:15:44,200 Speaker 2: we didn't pay bonuses if there was any job keeper 334 00:15:44,360 --> 00:15:47,960 Speaker 2: or any government money paid. And we're not taking on 335 00:15:48,040 --> 00:15:50,240 Speaker 2: in Australia with our company stores. We can't talk about 336 00:15:50,240 --> 00:15:51,880 Speaker 2: franchises because they have to make their own decisions, but 337 00:15:52,000 --> 00:15:53,960 Speaker 2: in our company we're not taking on, you know, the 338 00:15:54,000 --> 00:15:57,160 Speaker 2: rebates for training and development of people. We're saying, look, 339 00:15:57,280 --> 00:16:00,320 Speaker 2: we're doing well, we're privileged to do well, should be 340 00:16:00,440 --> 00:16:02,720 Speaker 2: very generous and you know, not lean on the government 341 00:16:02,760 --> 00:16:03,760 Speaker 2: purse wherever possible. 342 00:16:04,720 --> 00:16:07,920 Speaker 1: Is Domino's a pizza retailer, Is that how you would 343 00:16:07,920 --> 00:16:09,520 Speaker 1: describe it? Yeah? 344 00:16:09,560 --> 00:16:12,760 Speaker 2: Absolutely. It's a really unfortunate thing that because we've embraced 345 00:16:12,800 --> 00:16:16,440 Speaker 2: technology so well that along the way there's been a 346 00:16:16,480 --> 00:16:18,720 Speaker 2: myth that we've led. We've said that we're a technology 347 00:16:18,760 --> 00:16:22,200 Speaker 2: business and we're not. We're a pizza retailer. That's what 348 00:16:22,280 --> 00:16:25,240 Speaker 2: we proudly are. Now we've embraced technology because that's what 349 00:16:25,280 --> 00:16:27,880 Speaker 2: every retailer should be doing. So we've done a good 350 00:16:27,920 --> 00:16:30,440 Speaker 2: job at that. But then any good retailer's done well 351 00:16:30,480 --> 00:16:33,480 Speaker 2: in the last decade, has embraced ology. Yeah, we're obsessed 352 00:16:33,520 --> 00:16:34,080 Speaker 2: about pizza. 353 00:16:34,600 --> 00:16:36,480 Speaker 1: Okay, Well, drones ever deliver pizza? 354 00:16:37,120 --> 00:16:39,480 Speaker 2: Yeah. I do believe that automated delivery in all its 355 00:16:39,520 --> 00:16:42,360 Speaker 2: forms will happen. We still have projects going on. We're 356 00:16:42,400 --> 00:16:44,960 Speaker 2: about to start another project in Canberra with a company 357 00:16:45,000 --> 00:16:48,120 Speaker 2: called Kiwi Bot which are out of California, and that's 358 00:16:48,160 --> 00:16:50,640 Speaker 2: ground based robots. We have a partnership with a company 359 00:16:50,640 --> 00:16:53,000 Speaker 2: called Flirty out of Reno, founded by in Australian but 360 00:16:53,040 --> 00:16:55,920 Speaker 2: he moved his business to Nevada. He's doing a lot 361 00:16:55,960 --> 00:16:57,280 Speaker 2: of work in the US at the moment, not so 362 00:16:57,360 --> 00:16:58,840 Speaker 2: much in Australia New Zeland, but we did a lot 363 00:16:58,880 --> 00:17:01,760 Speaker 2: of work initially in New Zealand. I do think it's coming. 364 00:17:02,200 --> 00:17:04,600 Speaker 2: It won't be one size fits all, and the motivation 365 00:17:04,680 --> 00:17:07,199 Speaker 2: behind that is that there's not enough human beings on 366 00:17:07,240 --> 00:17:10,400 Speaker 2: the planet to deliver the number of packages that are 367 00:17:10,440 --> 00:17:14,520 Speaker 2: the Internet of Require and be Before COVID, we were 368 00:17:14,520 --> 00:17:16,520 Speaker 2: already struggling in Europe and Japan, which we didn't have 369 00:17:16,600 --> 00:17:20,000 Speaker 2: enough team members to deliver already, and so automated delivery 370 00:17:20,000 --> 00:17:22,560 Speaker 2: because the cost of delivery is going to rise so quickly. 371 00:17:22,840 --> 00:17:25,439 Speaker 2: You know, waging the year before in Japan went up 372 00:17:25,480 --> 00:17:28,600 Speaker 2: forty three percent as a market rate, the government rate, 373 00:17:28,920 --> 00:17:31,280 Speaker 2: with just the scarcity of labor, and so the real 374 00:17:31,320 --> 00:17:32,959 Speaker 2: cost of delivery is so high. You see all these 375 00:17:32,960 --> 00:17:35,560 Speaker 2: aggregators around the world losing a ton of money because 376 00:17:35,720 --> 00:17:38,680 Speaker 2: even though they're expensive, they're inefficient to the real cost 377 00:17:38,680 --> 00:17:43,280 Speaker 2: of delivery. So automated delivery is definitely coming. It's just 378 00:17:43,720 --> 00:17:45,760 Speaker 2: time and money and obviously safety. 379 00:17:46,359 --> 00:17:49,600 Speaker 1: So where will Domino has been five years time, We're. 380 00:17:49,400 --> 00:17:51,040 Speaker 2: Going to be a lot bigger, that's for sure. You know. 381 00:17:51,040 --> 00:17:53,239 Speaker 2: We tell our shareholders that we're on average grow at 382 00:17:53,280 --> 00:17:56,120 Speaker 2: seven to nine percent our store account compounding our same 383 00:17:56,160 --> 00:17:58,920 Speaker 2: so sales should grow three to six compounding. Now, both 384 00:17:58,960 --> 00:18:01,800 Speaker 2: those numbers pertendally could be larger this year, as we 385 00:18:02,200 --> 00:18:05,920 Speaker 2: showed in the first part of our reporting period, because 386 00:18:05,920 --> 00:18:08,399 Speaker 2: there's you know, we didn't open as many stool in 387 00:18:08,400 --> 00:18:11,240 Speaker 2: the last quarter because of the pandemic for the Lafe Financie, 388 00:18:11,320 --> 00:18:13,600 Speaker 2: so that's built open to this year. But there's a 389 00:18:13,600 --> 00:18:15,760 Speaker 2: lot of things in our Unfortunately, and I say this 390 00:18:15,920 --> 00:18:19,200 Speaker 2: unfortunately all of us wish this pandemic would go as 391 00:18:19,280 --> 00:18:21,360 Speaker 2: quick as possible, but there is a lot of distress 392 00:18:21,440 --> 00:18:23,960 Speaker 2: retail sites, so we've got access to sites. We've we've got, 393 00:18:24,240 --> 00:18:26,560 Speaker 2: you know, a larger access to people right now, both 394 00:18:26,560 --> 00:18:29,119 Speaker 2: from a team member point of view, but also professional executives. 395 00:18:29,560 --> 00:18:32,080 Speaker 2: We're getting a high talent that, you know, people we 396 00:18:32,119 --> 00:18:36,560 Speaker 2: couldn't recruit the last two years as a shortage in technology, strategy, insights, 397 00:18:36,680 --> 00:18:41,320 Speaker 2: data scientists. We're now getting access, which is unfortunate reasons, 398 00:18:41,480 --> 00:18:44,959 Speaker 2: but you know, hey, as a business, we have an 399 00:18:44,960 --> 00:18:48,560 Speaker 2: obligation to maximize these opportunities as well. And interest rates 400 00:18:48,600 --> 00:18:52,160 Speaker 2: alay soft commodities are reasonable, so everything is in our favor. 401 00:18:52,359 --> 00:18:54,360 Speaker 2: So yeah, we're trying to grow as hard and as 402 00:18:54,359 --> 00:18:55,160 Speaker 2: fast as we can. 403 00:18:55,640 --> 00:18:57,920 Speaker 1: Now, just before I let you go, you're an executive 404 00:18:57,920 --> 00:19:00,800 Speaker 1: of a global business now and I right now you're 405 00:19:00,800 --> 00:19:03,719 Speaker 1: in quarantine because you've come back into Australia recently. How 406 00:19:03,760 --> 00:19:06,080 Speaker 1: do you spend your time? They normally? Do you end 407 00:19:06,160 --> 00:19:08,639 Speaker 1: up spending a lot of time on planes? Has it worked? 408 00:19:08,760 --> 00:19:10,960 Speaker 1: How do you run such a big business? Yeah? 409 00:19:11,000 --> 00:19:13,560 Speaker 2: Before the pandemic, I would spend eight months of the 410 00:19:13,640 --> 00:19:17,960 Speaker 2: year approximately outside Australia and that was mostly spent in 411 00:19:18,080 --> 00:19:21,680 Speaker 2: Europe and Japan, but we also part of my role 412 00:19:21,760 --> 00:19:24,560 Speaker 2: is also discovery, so whether it be other future countries 413 00:19:24,800 --> 00:19:27,879 Speaker 2: or going on technology and product tours, you know, to 414 00:19:27,960 --> 00:19:30,879 Speaker 2: make sure where at the front of where is the 415 00:19:30,920 --> 00:19:34,439 Speaker 2: best retail technology and so between our own business and 416 00:19:34,480 --> 00:19:36,480 Speaker 2: trying to stay on the forefront. Yeah, it kept me 417 00:19:36,480 --> 00:19:38,800 Speaker 2: out of Australia about eight months of the year, but 418 00:19:38,880 --> 00:19:40,560 Speaker 2: I loved it. Don't get me wrong. It's not for 419 00:19:40,600 --> 00:19:43,800 Speaker 2: any I love our business. It's interconnected with my life, 420 00:19:43,840 --> 00:19:46,600 Speaker 2: so it's hard for me sometimes to define is this 421 00:19:46,720 --> 00:19:50,119 Speaker 2: work or is this the passion of my life? 422 00:19:50,320 --> 00:19:51,920 Speaker 1: No plans to give up soon then done. 423 00:19:52,080 --> 00:19:53,680 Speaker 2: No, I'm going to be here as long as shareholders 424 00:19:53,760 --> 00:19:54,840 Speaker 2: want me to be here and as long as my 425 00:19:54,880 --> 00:19:57,119 Speaker 2: health keeps me here. So you know, I'd love to 426 00:19:57,160 --> 00:19:59,600 Speaker 2: be able to celebrate a fiftieth anniversary one day at Domino's. 427 00:19:59,640 --> 00:20:02,359 Speaker 2: But you know we're a public company, so you know 428 00:20:02,400 --> 00:20:04,280 Speaker 2: you can't be a passenger, right, You've got to You're 429 00:20:04,320 --> 00:20:05,960 Speaker 2: only as good as your last result, and you've got 430 00:20:05,960 --> 00:20:07,720 Speaker 2: to stay on. You've got to keep your inventing yourself 431 00:20:07,720 --> 00:20:08,680 Speaker 2: as well as an individual. 432 00:20:08,840 --> 00:20:10,960 Speaker 1: Well, after a couple of years where it's not quite 433 00:20:10,960 --> 00:20:13,800 Speaker 1: clear what investors thought, certainly more recent times. They're big 434 00:20:13,840 --> 00:20:15,960 Speaker 1: fans of you, Don. Thank you very much for talking 435 00:20:15,960 --> 00:20:16,720 Speaker 1: to fear and greed. 436 00:20:17,000 --> 00:20:18,840 Speaker 2: Thank you, Sean. It's my pleasure that was 437 00:20:18,920 --> 00:20:26,320 Speaker 1: Chief executive officer of Domino's Don May