Domino’s Pizza, which was established in 1960 in Ypsilanti, Michigan, is the global market leader in the pizza industry with more than 6,700 stores in the United States and operating in more than 90 nations. To business owners who want to become part of this vast network, it is essential to know the financial investment and dedication required in establishing a Domino’s franchise in 2025.
Initial investment and financial requirements
The opening investment in a Domino’s franchise is high and ranges from approximately $107,000 to $744,000. This differs with location, store size, and store type to be opened.
Some of the financial requirements that the potential franchisees have to fulfill are:
- Net worth: At least $250,000.
- Liquid capital: At least $75,000 in liquid capital.
These are financial requirements intended to equip the franchisees with enough funds to cover initial establishment and operation of the business.
Initial cost breakdown
The initial cost comprises a variety of different costs, which are as follows:
- Franchise fee: $0 to $10,000. It should be mentioned that military veterans can get a 20% discount on this fee.
- Leasehold improvements: $5,000 to $350,000, depending on the state of the property as well as where it is located.
- Furniture, fixtures, and equipment: The prices of these can range from $62,000 to $145,000.
- Signage: Around $5,200 to $32,000.
- Opening inventory and supplies: Between $2,750 and $6,500.
- Insurance: Between $15,000 and $75,000.
These are approximate figures, but the actual costs could differ depending on individual cases and local factors.
Recurring fees and operating expenses
In addition to the initial franchise fee, the franchisees remit recurring fees to be used for ongoing branding and maintenance of the Domino’s chain:
- Royalty fee: 5.5% of weekly sales.
- Advertising fund contribution: 4% of weekly sales.
- Advertising co-op fund: 1.4% of weekly sales.
There are technology fees as well, including:
- Initial license fee: $4,200.
- Annual software fee: $743 per store in year two and later.
- Help desk fee: $44 per call or $28 per chat.
These fees are necessary to cover the cost of maintaining brand standards, national and local advertising programs, and access to the most current technologies.
Franchisee eligibility and training
Domino’s adopts an unconventional franchising strategy that emphasizes internal promotion. Domino’s needs future franchisees to supply one year of supervisory or general manager experience at one of its current stores. The practice is indicative of the brand’s desire to run operations seamlessly and guarantees that the franchisees are highly experienced with the company’s procedures and standards.
For those out of the Domino’s system at the time but who would like to franchise, Domino’s actually prefers to get some experience of working within the system first and observe how things operate before investing. This is one of the entry channels that shows Domino’s desire to have a shrewd and experienced set of franchisees.
Profitability and return on investment
Buying a Domino’s franchise is profitable. Franchisee-owned stores, as stated, can generate average yearly revenues of approximately $1.3 million. With profit margins of 10% to 20%, the franchisees would likely have yearly profits of between $130,000 and $260,000. Using these projections, the initial investment can be recouped in 4 to 6 years.
