Domino’s Pizza joins Kenya fast food market

Domino’s Pizza

Domino’s Pizza International plans to expand its presence in East Africa after opening its first shop in Kenya last month, heightening competition among global fast-food franchises attracted by regional economic growth.

The unit of Michigan-based Domino’s Pizza, which began operating its second location in Kenya’s capital, Nairobi, last week, targets new outlets in the port city of Mombasa, as well as Tanzania, Uganda and Rwanda, said Richard Allison, president of Domino’s international arm.

“We look at Kenya as the gateway to East Africa,” he said at the opening ceremony attended by the US Ambassador to Kenya Robert Godec. “There is a growing middle class, growing spending power among consumers and a strong receptivity to international brands,” Allison said.

Competition among overseas restaurant chains has been on the rise since KFC, owned by Yum! Brands, became the first US-based fast-food chain to enter Nairobi in 2011. It was followed by others including Connecticut-based Subway Restaurants, New Orleans-based Naked Pizza and ice-cream chain Cold Stone Creamery, whose parent company is Kahala Corp. based in Scottsdale, Arizona.

Domino’s will be adaptable to challenges in the region including the threat of ‘terrorism’, which isn’t unique to Kenya, said Allison. Al-Qaeda’s Somalia-based affiliate, al-Shabaab, has claimed responsibility for a string of gun and grenade attacks in Kenya, including a raid on a mall in Nairobi last year that left 67 people dead and most recently assaults on bus passengers and quarry workers in the north.

Crime “happens all over the world and it even happens in the US,” said Allison. “We try to be mindful about where we locate our stores, about making sure that we create an environment that is safe for our team members and customers.”

Swahili Pizza

The company has adapted its menu in Kenya for local tastes with offers such as the Swahili Chicken Pizza, which costs Sh1,250 for a large. That compares with as much as Sh900 for the same size from the Kenyan locations of Debonairs Pizza, a South Africa-based chain.
Om Nom Nom Ltd, which holds the Kenyan franchise for Domino’s and Cold Stone Creamery, has invested $6 million (Sh540 million) since February 1, director Eric Andre said.

Domino’s operates in 75 countries, with more than half its retail sales generated by international stores. In Africa, the brand has locations in Egypt, Morocco, Nigeria and South Africa, Allison said. Kenya’s economy is forecast by the International Monetary Fund to expand 5.8 percent in the fiscal year through June from 5 percent last year.

 —Bloomberg