Dominos Stores Closing; More than 100 Laid Off , franchise owner sites high min. wage as one reason

[The Straight Story]

Dominos Stores Closing; More than 100 Laid Off

Eight Domino's pizza stores are closing the Reno area, according to franchise owner Brandon Jones.

Jones said it's hoped just one store may remain open. However, it appears the following locations are closing: Greenbrea in Sparks, Robb Drive in West Reno, Fallon, Fernley, Sun Valley, Stead and Susanville. Jones said the Fernley store shut down last week. He said he shut down a store on Vista Boulevard four months ago. The other closures were expected to be effective Sunday.

Jones said the latest closures leave 120 to 130 people out of a job.

"I sure don't want these employees to be without a job for long, it's very unfortunate we're talking about 130 or so employees I know how it feels to be without a job because I'm without one too," Jones said.

He said business is down about 40 percent from two years ago. Jones said increases in the minimum wage have also made it difficult to be profitable. Jones said he owes Domino's $80,000 and was forced to close his stores.

http://www.kolotv.com/news/headlines/37428554.html

[Occam Bandage]

1. If his business was only profitable through underpriced labor,

then it deserves to close. Other, better-paying jobs will open up because of the increased spending by other workers seeing a raise. No study has ever shown a negative employment effect caused by minimum wage increases.

[ogneopasno]

7. Exactly. If his margin was so thin that that put him over the edge, he wasn't running his

franchises well anyway.

[Xithras]

31. That's not exactly fair.

As a business owner myself, I can state that "running your business well" is only one component to profitability. Having a customer base that can afford your product is an even more important consideration. As the article states, the guys business is down 40% in the past year, probably because of the economy. In that case, the extra bump from minimum wage may well have been enough to push him over the edge.

This is a fairly normal and accepted part of rising wages though. Businesses barely scraping by will fail. Their customers will be taken over by other companies (typically bigger) with better margins who can afford those wages. Business ownership is as darwinian as it gets, and the weak don't survive.

[ogneopasno]

33. Good points. Thanks for your perspective!

[Hannah Bell]

39. for fast food, it means: the big survive. oh, good.

[Xithras]

43. Darwinism doesn't care much about fairness. Or quality. n/t

[Hannah Bell]

44. so? i hadn't realized that we were necessarily doomed to darwinian

"survival of the dickest" in our social existence.

[Deja Q]

50. "Survival of the dickest". A damning truth. On the plus side,

"to lose is to win, and he who wins shall lose."

The dickest, who think they're fittest, will undoubtedly not like it once they win. Like wanting vs having... having isn't always as pleasing as wanting.

[Hannah Bell]

51. cold comfort for those they murder & ruin.

[11 Bravo]

65. Our local Dominos has knocked off a dozen people in the last week alone.

[Xithras]

61. We're talking small business, an inherently Darwinian environment.

There is no way, under any economic system, to shield small businesses from the predatory business practices of other businesses. If your competition runs a sale that takes all of your customers, there's not much you can do about it. There is no way to prop them up if the "customer" decides to shop elsewhere...or nowhere at all.

The larger the business, the larger the customer base. The larger their customer base, the more they can withstand a percentage of that base abandoning them.

BTW, my own consulting firm is teetering on the edge of oblivion at the moment. Two of my clients have folded, and the rest have either canceled existing projects or have put a hold on new ones. According to my accountant, we have until mid-February to find new work or my seven remaining full time employees will be unemployed. I already let four contract workers go because I had no work for them. Last year we barely survived (income exceeded expenses by a paltry seven thousand dollars). So far this year, business is down 100%. We haven't picked up a single new project since November, and our remaining projects are coming to a close. We do have some income from other business activities (we do maintenance on customer POS machines), but we still need at least two paying projects at any given moment to keep the lights on and the rent paid. We have ONE project right now, and are covering the difference out of company reserves. That one project will be done Friday.

In the meantime, Wipro and various other foreign mega-outsourcers will be chugging along while my puny domestic insourcing/consulting firm folds. Survival of the dickest indeed.

[Hannah Bell]

64. there *are* ways to protect small businesses. they did it in e.g. france for

decades.

our gov't chooses *not* to; in fact, often chooses to destroy them.

[lumberjack_jeff]

57. Causality.

I could believe that he was put out of business by the shitty economy. I don't believe that, given the shitty economy, it was the minimum wage that put him out of business.

[Two Americas]

75. self contradictory

Obviously, there is a connection between paying decent wages and "having a customer base that can afford your product."

These chains have driven wages down. Now people can't afford their products. Conservatives love to throw out these simple-minded ideas about "Darwinism" and "supply and demand" and "build a better mousetrap" but they ignore the very obvious truth that if your business practices destroy the public infrastructure and drive the workers to desperation, then guess what? Those chickens will come home to roost. Are we to them imagine that it is the workers or minimum wage laws that are to blame?

The business owners are the last ones to suffer, suffer from the problems they themselves caused or at the very least contributed to. Now they will try to hold us hostage - "if we go down, there will be no jobs and then you will be really sorry." Business has had its own way for decades. It is the rare business person who does not support and promote the anti-social and self-destructive libertarian free market wild west model for the economy. The bill is now coming due.

[47of74]

23. Agreed

But every righty in creation will be out there making all sorts of political hay about the supposed evils of minimum wage.

[Occam Bandage]

26. I like your signature. nt

[SoCalDem]

41. $5 pizza that tastes awful is not a good business plan

and the chickens are home to roost for many franchisees..

Most towns have WAAAAAAY too many pizza joints, tacky mexican fast food joints, hamburger places..Look for a lot more to close up..everywhere..

Remember all the little foto-mat places that were everywhere?? gone now

all the donut shops? gone too

Business bandwagons usually don't last.. especially in a financial downturn

[jmowreader]

58. I think you hit the nail on the head, SoCalDem

Of all the national pizza chains, Dominos comes closest to producing a pie that tastes exactly like the box it comes in. I expect Dominos corporate to shut down in the upcoming shakeout--the franchisees should be okay if they can buy into another pizza system.

The system I really expect to take off in the next few years is Hunt Brothers, which deals exclusively with convenience stores.

[PatGund]

72. It's a great pizza....

....if you like play doh topped with motor oil and spicy rubber bands that is.

[Nickster]

77. Their new samiches are excellent though.

[gravity]

48. Delivery drivers make much more than minimum wage

once you factor in the tips. I wouldn't call that costs of labor more underpriced compared to other types of businesses.

[Baby Snooks]

80. But tips are down...

Anyone who works for tips will tell you their income is roughly half of what it was a year ago. People are not spending money. So others are not making money. The coming months are going to see a lot of restaurants including the fast-food restaurants go under. The same is probably going to be true for all of the "consumer-supported" sector. It is already affecting retail. Many stores will be closing in the coming months.

The economy has collapsed. Everyone but Congress knows it has. And Congress is only worsening the problem by continuing to bail out the very people who caused the economy to collapse to begin with.

[yodoobo]

62. true. But those employees didn't deserve to be laid off either

Now they aren't receiving any wage at all.

It seems that maybe a requirement should be put in place that bars employers from laying off employees for 6 months after a minimum wage increase, to close this loophole.

[Wilms]

2. The minimum wage leaves workers without enough money to buy pizza.

So yeah. The minimum wage is a problem.

[madrchsod]

3. could crappy pizzas be the problem?

the one here is really bad. it does`t have any business do to crappy pizza and increased competition....

[shraby]

16. I agree on the crappy pizza bit..they used to

be a good pizza, but I can't stand them now. They just don't make a good pizza anymore.

[xchrom]

4. he's a liar -- and he was gonna say that no matter what. nt

[DS1]

5. I could eat their pizza in the 80s

These days, I think it's barely edible. *shudder*

[YOY]

6. If only Dominoes didn't taste like sugar laced tomatoes with wax on cardboard

Then maybe he could get the sales to afford to pay the minimum wage folks...

[SmileyRose]

8. How did someone that idiot amass that many stores to begin with?

I feel bad for the workers though.......

[katusha]

9. it has nothing to do with his mismanagement eh?

sure, blame the workers for your failings as a businessman.

[RB TexLa]

10. Efficiency, purchasing your own food and preparing it yourself saves money

Paying a restaurant to do so is wasteful.

[freeplessinseattle]

11. or maybe it's the crappy food?

argh, another one of those min wage haters. and I wonder how many cars and houses he owns?

I could swear I heard something skeevy about this guy before, wish I could remember. anyone?

[tularetom]

12. Does this mean Fun-doh-mentalist Catholic City in Fla is on hold?

The owner of Domino's is a religious whack job who planned to build a city for extreme radical Catholics somewhere in Fla.

I feel sorry for this franchisee, but in all honesty I won't miss the cardboard pizza sold at Domino's.

[LostinVA]

15. He hasn't owned Domino's for many years

[freeplessinseattle]

25. I knew I had heard something creepy about this guy before!

why am I not surprised

[AlCzervik]

13. Their pizza is terrible and i'm sure that's a contributing factor.

[madokie]

14. skimmed a little too much off the top there didn't you buddy

fuck him. I wonder how many of his workers were undocumented workers?

[arcadian]

17. That is bad if a super high volume tourist area can't support pizza delivery like that.

That spells trouble.

[jmowreader]

60. Reno has no problem with supporting pizza delivery...

but a LOT of problems with supporting the delivery of bad pizza. I bet (no, pun not intended) the Reno franchisees for Papa Johns, Godfathers, Pizza Hut and Little Caesars are doing okay even in this bad economy.

[xxqqqzme]

18. wasn't dominos started by the nut job

building immaculate conception city(or some such name) in Florida?

[DemoTex]

20. Yep .. see #19

:hi:

[DemoTex]

19. Jesus Saves, eh Tom?

I guess Jesus just isn't into saving pizza-pies nowadays.

BTW: Howgozit down there in sunny Ave Maria, Florida? Been to an Opus Dei "meeting" lately?

http://www.forbes.com/2006/03/03/monaghan-dominos-philanthropy-cx_cn_0303autofacescan06.html


Tom Monaghan, Fundy Founder of Domino's and Ave Maria, FL.

[w4rma]

21. Looks to me like he overexpanded. I wonder what his interest payments to the banks were. (nt)

[Jambalaya]

22. Mitt's Pizza

This story raises several issues to my ear. One it's from Nevavda- land of casinos,Mormons,Harry Reid, and LOTS of unionized service workers and industries- possibly more with EFCA on the table.Unions do drive up the wages of non union workers.Another issue is the tie of Domino's to Mormon Mitt Romney. Bain Capital(Mitt's firm) bought out Domino's for a billion or so a while back,aldo Dunkin'Donuts,among other things.________________________________________________________________________________________________

Domino's Pizza founder delivers to Romney's door: The Swamp Jan 9, 2008 ... And he's delivering family values to Mitt Romney in 30 minutes or less. The former Domino's Pizza owner and noted anti-abortion activist ...
www.swamppolitics.com/news/politics/blog/2008/01/dominos_pizza_founder_delivers.html - 98k - Cached - Similar pages

[Chiyo-chichi]

27. He is specifically grousing about the minimum wage increase.

If it were the case that the presence of service worker unions was driving up the wages of his non-union employees, I'll bet he would be sure to grouse about that.

[Jambalaya]

30. Military Industrial Pizza,anyone?

Dunkin’ Brands Inc., which owns Dunkin’ Donuts, Togos and Baskin Robbins, has three investors, according to their homepage: The Carlyle Group, Bain Capital, Thomas H. Lee Partners, L.P.

[Jambalaya]

38. How about a video with Papa Domino?

Dunkin' Brands Inc. Appoints Nigel Travis as Chief Executive Officer Effective January 6, 2009
12/10/2008
Dunkin' Brands Inc. announced that Nigel Travis has been appointed as chief executive officer. Most recently, Travis, 58, was the president & CEO of Papa John's. Effective January 6, 2009, he will assume the role from Jon Luther, who will remain executive chairman of the board. Luther, 65, joined Dunkin' Brands in January 2003 as Chief Executive Officer and added the role of Chairman in 2006. Prior to Papa John's, Travis was with Blockbuster Inc. from 1994 to 2004, where he served in increasing roles of responsibility, including president & chief operating officer. Travis also built a worldwide franchise network of 300 franchisees in 15 countries with revenues of approximately $1 billion, and transitioned the company from a video rental store chain to a complete movie and game source. Luther will remain with the company in a full-time capacity as executive chairman of the board, and will work closely with Travis to ensure a smooth transition for the company.-----------------------------Businessweek

[JHB]

24. Franchise (monopoly supplier) also "makes it difficult to be profitable"...

...in the face of a 40% downturn in business. You can't economize or make deals with Corporate.

Hell, in a 40% downturn, ANY expense "makes it difficult to be profitable". If you are still profitable you must have been gouging the hell out of your customers.

I wonder how many forclosures he had in his delivery areas. And how many are barely staying above it? That's the sort of stat you'd want to know with a business based on people paying $10-20-more a pop for convenient mediocre (at its best) pizza and NOT looking for ways to economize and save a few bucks.

Here's a hint, Brandon: put Democrats in office. Then enough people will have money to spare that your francises won't go bust.

[RaleighNCDUer]

28. He cites min wage as A reason, not THE reason, and also says

business is down 40% over two years. IOW, it's the collapsing economy that is causing the failure, and his political POV tells him to blame the min wage. The fact is, even if the min wage had not increased, he would still be dealing with a 40% loss of business and would still be going under.

Funny, he didn't mention $4 gas as having anything to do with going $80k in debt on the franchise, when the business is entirely dependent upon deliveries. I betcha, he instituted a minimum charge for making deliveries to make sure each trip was worth it, and in doing so lost 10% of his business right there.

[RedRocco]

54. gas/vehicle costs are on the driver, not the store

"Funny, he didn't mention $4 gas as having anything to do with going $80k in debt on the franchise, when the business is entirely dependent upon deliveries. I betcha, he instituted a minimum charge for making deliveries to make sure each trip was worth it, and in doing so lost 10% of his business right there."


Dominoe's pays drivers min wage + trip and tip, drivers pay for their own gas, insurance and maiontainence. That said, I never averaged less than $15 an hour when I delivered pizza.

[RaleighNCDUer]

73. Doh!

(Or should I say Dough!?)

I should have remembered that.

[Nikki Stone1]

29. Good. The pizzas were awful and the politics was worse.

I'll be happy when the whole franchise folds. Then we can get back to REAL pizza and women's rights will have one less monied maniac to worry about.

[azmouse]

32. Locally owned pizzerias make better pizza anyway but

I'm sorry for those who are losing their jobs.

[JHB]

35. Mostly...

...but a few horror stories do exist.

[muntrv]

34. Maybe it's because there are better pizza places than Dominos.

Dominos is overpriced and underqualified in taste. Little Caesar's offers large pepperoni pizzas for $5.

[taught_me_patience]

36. High minimum wages are hurting small businesses

Of course, revenue down 40% hurts worse and has nothing to do with minimum wage.

[Greyhound]

37. Business drops 40% and the franchise fees remain, but it is the minimum wage...

:eyes:

[juno jones]

40. Most people I know won't eat Dominoes anyways

The pizza sucks, they treat their workers like shit and they fund conservative causes like 'Right to Life'.

Dude probably derserves every loss coming his way. I feel for his employees but they'll find far more humane treatment elsewhere. There's a lot of food service jobs in those areas.

[pinto]

42. Restaurants, especially mid priced, and pizza outlets have been hit hard.

I'm a diner fan, and the ones around here have laid off left and right.

[mnhtnbb]

45. Too bad he didn't open a store near the Duggers. He would have made a fortune.

[Ilsa]

46. Worst veggie pizza. Hubby changed to another

brand that is marginally better. Dominoes is greasy, gluey crap.

My guess is this owner has a political agenda against paying better wages.

[Incitatus]

47. Dominos is worse than most frozen pizzas.

That could be another contributing factor.

[Liberal_in_LA]

67. It's bread, sauce, and cheese. Very bland.

[Deja Q]

49. I love paying $20 for something that looks like a frisbee and is loaded with choesterol and fat

:shrug:

I wouldn't blame the wage as I would quality. I'd reckon duck feces has a better taste when compared to the last time I took a bite of out dominos pizza.

[Vinca]

52. Wouldn't want the poor people forced to work at a place

like Domino's to enjoy a decent standard of living. But I'm sure the owner makes up for it with great benefits.:sarcasm:

[ColbertWatcher]

53. What an ass.

He's closing down because his customer base has no money for pizzas.

Dumbass.

[FarCenter]

55. There appear to be at least 5 others in Reno besides his -- wonder how they are doing

The store locator identifies 13 stores for Reno, NV.

If he closes 7, there would be 6 left. Somebody else must own the rest?

[lib2DaBone]

56. Bull.. has nothing to do with minimum wage...

This guy sounds like a Freeper.. loaded with cash and wants to bust the worker bees.

The first thing people cut out in a depression is eating out.... especially DOMINOES inmitation Pizza.

Instructions for Eating a Dominoes Pizza: heat the Box and the Pizza at 350 degress for 20 minutes, throw the Pizza away and eat the box.

[noamnety]

59. "His bathroom is worth one million dollars,"

"His bathroom is worth one million dollars," Schneider said, remembering a tour he took of the Domino's headquarters. He added that the bathroom had "gold-plated fixtures."

http://www.pub.umich.edu/daily/1999/mar/03-16-99/news/news4.html

darn that high minimum wage.

[TBF]

74. Rec. this response! :) n/t

[Odin2005]

63. "minimum wage" MY ASS. It's because their pizza sucks.

If I order pizza it's almost always Papa Johns. Fuck Dominos

[KillCapitalism]

66. Exactly.

My 8-year old niece could probably make a better pizza from scratch than they can.

[GReedDiamond]

69. Agreed, the State of Nevada currently...

...mandates a minimum wage of $6.85/hour, according to http://www.dol.gov/esa/minwage/america.htm. That is definitely not a "high minimum wage" (a phrase I saw someone use in a post above), and I'd hate to have to compete these days for the few available jobs on even that level and then somehow live on that, especially with any kind of family to support.

A quick scan of the above link also showed that the State of Washington currently has the highest minimum wage in the country, at a whopping $8.55/hour (unless my "quick scan" missed something).

And add me to the chorus of "Dominos Sucks"! It's a bad business model, based on a cheap mass produced polished turd pizza recipe from corporate hell. Whattaya wanna bet they use GMO tomato sauce and Monsanto RoundUp in their "pizza"?

[busybl]

68. couldn't be cuz the pizza is the worst in the world?

the sauce is so watered down it turns the crust cack into dough.

[JI7]

70. Does Jones own all of those places ?

maybe he just sucks as a business guy.

and most people i know only get pizza from Dominos when there are no other Pizza places around, or if they are the only ones to deliver.

[Horse with no Name]

71. I'm guessing the housing crisis in Nevada has nothing to do with this

Dominoes will deliver to cardboard boxes now!:sarcasm:
What a dumbshit to blame it on the high minimum wage.

[Doctor_J]

76. If you can't afford to pay people LIVING wage, then b-bye

Since Jones's franchise is going under, maybe he can get a min wage job and see how great it is.

[baldguy]

78. If you can't afford the cost of doing business, you can't afford the business.

Leaves the market open for people who WILL pay a fair wage to their employees - and make good 'za while they're at it.

[RainDog]

79. I haven't bought a pizza from a Dominos in years

I boycotted them as soon as I found out the owner supports groups that want to take away the legal right to abortion.

can't say I'm sorry to hear that the founder won't be making more money off of people working for low wages to pay for campaigns to deny women a right to privacy in medical decisions.

[Orsino]

81. The high cost of starving workers done him in. n/t

[trashcanistanista]

82. O.K. you Nevada No on 8'ers, good work! Thank you from

your next door California neighors! :hi:

[TK421]

83. I wouldn't go so far as to call this "crap" pizza

it is, in my opinion the nastiest, blandest shit-in-a-box for a relatively high price

Has anyone ever tried to re-heat Dominoes pizza? You can't do it....it wilts in a conventional oven and dissolves in a microwave.

I'm just glad we have an abundance of great pizza joints around here

That's a real bitch about the employees, however...

[krispos42]

84. And a large part of their market is minimum-wage-earning teens...

...and early 20somethings. So if they didn't make this ultra-terrible minimum wage, how would they have been able to afford Domino's crappy pizza the last few years in the first place?

Lord knows if you can afford it, you get at least Pizza Hut instead!