The Reason Domino's Pizza Is So Cheap

While it's not the healthiest meal (two cheese slices from a large Domino's pizza contains 580 calories and 1,180 milligrams of sodium, per the chain's Cal-O-Meter), there's something special about ordering a big, greasy pizza, having a few beers, and inviting some friends over for a night in. According to Fast Food Menu Prices, the average price of a Domino's large cheese pizza is $9.99, with the chain frequently offering deep discounts and deals that lower the price even more. 

Jenny Fouracre, Domino's director of public relations, told the Los Angeles Times in 2015 that the amount charged for a single pizza can vary based on where you're ordering and what the franchise owners choose to set the price at. However, national discounts and coupons tend to keep the costs relatively similar across state lines. 

With deals this good, we have to wonder how Domino's keeps serving such affordable pizza.

Workers appear to be some of the people shouldering the burden of Domino's low prices, with HuffPost reporting in 2016 that the pizza industry is one of the biggest offenders when it comes to low wages. 

In 2016, a lawsuit filed by the New York attorney general accused Domino's of fraud and systematic wage theft by repeatedly shortening workers' pay, according to a separate HuffPost report. The lawsuit alleged that Domino's headquarters instructed franchise owners to purchase the software system PULSE for payroll, which led to them shorting workers on wages. Domino's headquarters allegedly knew about the issue but deemed it to be a "low priority."

Franchise owners are claiming they've been hit as well, with one Domino's franchisee telling News.Com.Au in 2018 that the reduction of prices around 2014 began cutting into profits and forcing shops to sell pizzas at or below cost. Many of the people who opened shops before the price decreases had to close up, citing the hard work and time they were putting into building their businesses wasn't making sense given the debt they were building from the costs. They were told the price cuts were a temporary promotion, but it quickly became clear to them that the low prices and deep discounts were here to stay. A Domino's spokesperson told the reporter that since introducing a value deal in Australia, where the article was reported from, stores had seen increased profits and sales.

While Domino's offers a number of well-known money-saving promotions, such as its two-for-$5.99 mix-and-match deal, there are plenty of other items on the chain restaurant's menu that come at a markup. 

For example, a two-liter bottle of Coke will set you back around $3.39 at the chain, while a 20-ounce Coke bottle costs around $2.28 at Domino's (according to June 2022 menu prices from a North Carolina Domino's location). As Business Insider notes, "restaurant soda" and bottled water are two of the restaurant food items with the highest markups; if you're ordering drinks for everyone along with your pizza, the cost can add up quickly.

Combine that with the other "extras" on the Domino's menu, such as desserts, salads, and even pasta, and it's not hard to see how your bill can add up fast. And that's not including the additional dipping cups, grated cheese, and crushed red pepper you're likely adding to your pizza order — those all cost money, too.

Buying ingredients in bulk is a key success factor for many chain restaurants, and Domino's is no different. According to a report from Quartz, the Connecticut facility that supplies Domino's with its dough balls is a "hyper-efficient" operation, which helps keep production costs down. Quartz explains that every five minutes — with a 24/7 operating timeline — the facility makes 500 pounds of pizza dough, all for Domino's.

"In the supply chain world, we're rocking, we're pretty cool," Larry Manning, the director of the Connecticut dough supply center for Domino's, told Quartz. "We've got our own fleet, we've got our own drivers, we go in the dead of night, the biggest storms." Move over, USPS!

In addition to its time-saving dough process, Domino's also uses the same pizza cheese as Pizza Hut and Papa John's, according to a 2017 Forbes report. The outlet explains that Leprino Foods provides mozzarella for all three pizza chains. (The Domino's pizza sauce options, however, appear to be unique to the chain.) But at the end of the day, it doesn't take a comprehensive understanding of Domino's business practices to appreciate the price points of the chain's pizza.