Domino's Pizza seeks bigger slice of China market

US-based Domino's Pizza Inc, the world's largest pizza company in terms of revenue, said it plans to further expand its footprint in China by opening more than 600 stores through 2026 as the pizza chain works to capitalize on the bullish growth prospects in the Chinese market.

The pizza chain said about 300-350 new store openings were planned for this year, and another 300-350 for next year.

Founded in 1960, the pizza chain announced earlier this month that it will close 205 loss-making stores globally, including 172 stores in the highly competitive Japanese market, to sharpen market focus and improve profitability.

But despite paring down its presence in other markets, Domino's Pizza has continued to scout for new opportunities in China, its third-largest market globally after India and the United Kingdom, the company said.

DPC Dash Ltd, Domino's Pizza's exclusive master franchisee in the Chinese mainland, Hong Kong and Macao, said since 2017, the company has experienced rapid growth in the number of stores, expanding nearly 10-fold from over 100 stores in 2017 to more than 1,000 stores in seven years. By the end of last year, the pizza company operated 1,008 stores in China.

During the 2024 Christmas and 2025 New Year holidays, it launched 14 new stores in another 13 Chinese cities, especially in second- and third-tier cities.

The recent expansion saw the company open stores in cities such as Shenyang, Liaoning province; Chongqing; Zhengzhou, Henan province; Shijiazhuang, Hebei province; Yantai, Shandong province; and Quanzhou, Fujian province. DPC Dash said the new stores have been well-received, with customers lining up outside becoming a common feature.

The locations of those new stores were strategically selected based on the demand of local consumers and market potential, the company said. With high dine-in demand, the new stores currently do not offer delivery services. At many other stores, Domino's Pizza has been mainly focused on a delivery-centric business model.

"Entering into the 13 cities is another important milestone of DPC Dash's development journey. We will stick to a consumer-centric approach and continuously optimize the products and services," said Aileen Wang, CEO of DPC Dash.

Last year, Domino's Pizza saw robust business performance in China. In the first half of 2024, it reported a revenue of 2.04 billion yuan ($281 million), up 48.3 percent year-on-year.

"Domino's Pizza is expected to continue its pace of expansion in China, a relatively emerging market. China has indicated better growth prospects than Japan, a traditional mature market for the company, and the adjustment of stores in Japan has been a normal business practice," said Zhu Danpeng, an independent food and beverage industry analyst.

In 1997, Domino's Pizza entered the Chinese mainland market, and the concept of food delivery began to emerge in the country. Back in 1990, Pizza Hut, a major rival, opened its first outlet in Beijing.

Currently, Domino's Pizza commands the third-largest market share in China behind Pizza Hut and domestic chain Champion Pizza.

By the end of last year, Pizza Hut operated 3,724 stores in China, according to Yum China, its parent company in the country. As of January, Champion Pizza operated more than 2,900 stores nationwide, according to Canyan Data, a third-party platform on the Chinese mainland that provides catering sector data.

Apart from Pizza Hut and Domino's, there are other major foreign pizza chains operating in China, including Pizza Marzano from the UK and Papa John's from the United States, as well as notable local pizza brands such as Big Pizza and La Cesar. Founded in Shenzhen in 2009, La Cesar first introduced durian-flavored pizza, thus increasing flavor options.

In China, the penetration rate of pizza is relatively lower compared with the US, Europe, Japan and South Korea, but the market has been growing rapidly, fueled by the development of the delivery business and young consumers' evolving lifestyles, according to LeadLeo Research Institute, a market research consultancy.