Domino's licence is huge news

This is big. Well done to the fellows over at Taste for having secured the exclusive Master Franchise rights (30 years) for Domino's Pizza for seven Southern African countries, obviously including South Africa. Domino's, for those of you who do not know are the biggest pizza outlet in the world and are synonymous with the food that is right up there with the comfort food of choice. Cheese, melted on a crispy base, with your favourite other foods. Piping hot.


So what happens from here? The existing Scooters Pizza and St. Elmo's stores will be converted to Domino's stores. Those chaps must be excited beyond words, I am not sure whether or not the franchise owners will have to pay more for the better known franchise, perhaps we can explore that later. According to the Taste release, there are 125 plus outlets of theirs currently, that will be rebranded. I had read however in the annual report that there were 136 Maxi's and 26 St. Elmo's, as at the last annual report. The goal is to become the leading pizza delivery brand across Southern Africa over the next five years. As per the February 2013 Annual report, there are 344 Debonairs inside South Africa and 60 outside, so these plans of Taste (for Domino's) are huge, if you think about it. That would make it bigger than Fish and Chips (good timing and purchase there), which as per the annual report had 312 outlets, which is more than half of all stores.


What is more huge, for me, is the entrepreneurial spirit. In 2001, system wide sales (store to customer) across the business was a mere 4.3 million Rand. You read right. By 2011, it had grown to 752 million Rand. For 2013, their system wide sales, from stores to customers had grown to 1.38 billion Rand. I've known these guys since they listed, I know Carlo Gonzaga, the CEO. He is energetic, he remains entrepreneurial, he is still young, I think he turns 40 this year (39 in the last annual report). And he ignores the noise around him. And I am even going to throw this one in, I remember being stuck in a room full of know it alls who were suggesting that the only person buying the shares post the Taste IPO were the directors, and indeed Carlo himself. Perhaps they were sellers below the IPO price because they didn't see a pop. Ha-ha, and what now guys? The share price since 2006 is up around ten fold.


The business is now worth 750 million Rand, and is certainly going places, the stock is up around seven an a half percent today. We should celebrate entrepreneurs like this, people who despite everything thrown at them continue to persevere, notwithstanding the combative approach from government to businesses. Without small businesses that become medium sized businesses and ultimately big businesses, there would be no creation of any jobs. Truth.