7/14/2023 0 Comments Dominos pwr![]() It said the average profitability of a franchisee ranges between $138,000 and $145,000 a year. ![]() In response to a list of questions, Domino’s denied systemic underpayment of wages, saying it was “embarrassed where an employee has not been paid their appropriate entitlements, whether deliberately or accidentally” and rejected claims that some of its franchisees were getting a rough deal. More stores in the network means more sales are generated, and that results in more profits for head office. Stores are bought and sold on a multiple of these sales, not on profit.įor franchisees, it means when labour, food or rent costs increase, or Domino’s introduces a new fee or charge, the franchisees have to wear it. Today, Cowin, who is a director of Fairfax Media, is Domino’s chairman and its biggest shareholder, holding a 26 per cent stake, valued at around $1.4 billion, through a family trust.įairfax’s investigation shows that the Domino’s business model is based on franchisees growing sales, not profit, with head office taking a royalty from every sale as Australians chomp through one million of its pizzas every week. So, nobody is left to pay for this but the franchisees.” Hence, we have clients winning by purchasing cheap food, Domino’s profit skyrocketing. ![]() At the same time, Domino’s profit is doubling. ![]() “And this is coming from a guy who escaped from a fundamentalist and religious dictatorship, that has seen a lot in his life.”įor Talebi, it’s simple maths: “Since September 2014, the cost of food, labour, rent and fixed costs are on the rise, whilst the prices of pizzas are on decline we can now buy pizza at the 1990s prices. “It was the worst time in my life,” Talebi said. His store was bought by Iranian migrant Kamran Talebi who also lasted only two years before selling out. If I’m driving around in a beat-up old car, who’s really cheating the system?” he says. “If I’m cheating my workers and driving a Ferrari, that’s wrong. Nirmal says he never underpaid employees himself but can’t blame those franchisees who did. “I thought I would stay in the system long enough to recoup my costs first, but the longer I stayed in the system the worse it got.” “I lost my trust and faith in Domino’s they think only about the corporate people.” The stress of making ends meet took its toll and he realised after just six months the business he had bought into was not viable. “I remember I had to use my wife to do deliveries with my two kids in the back of the car,” says Nirmal Patel, who ran the Domino’s store in Mount Colah, a suburb of northern Sydney, for two years from 2012. Part of the explanation, say a procession of insiders, is that franchisees are also hurting. Yin is one of hundreds, possibly thousands, of Domino’s workers and franchisees trying to scratch a living out of the nation’s appetite for ever cheaper pizza.Ī six-month investigation by Fairfax Media into Domino’s and its franchisees has uncovered widespread underpayment of wages, the deliberate underpayment of penalties using a delivery scam and the illegal sale of sponsorships of migrants for as much as $150,000. This is the reality of life inside the Domino’s juggernaut. Meanwhile, Dehsabzi is held up as a Domino’s success story. Nine months after complaining to Domino’s head office, Yin is still waiting for a response. Then I deduct my own time as well as the other workers,” he told Fairfax Media. “If this week bad sales, labour blows out to 33 per cent of sales, so I receive a call to make it 27 per cent. It meant he often had to go into the store’s payroll system and “trim” the number of hours it recorded as worked by its staff and reduce their pay accordingly. His boss, franchisee Pamir Dehsabzi, had told him to keep labour costs below 27 per cent of sales by any means. When he finally did, nobody seemed to care. It took Domino’s store manager Azrael Yin three years to pluck up the courage to inform head office that one of its biggest franchisees was exploiting workers.
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