Rome/London (CNN Business) — Domino’s foray into Italy was much more difficult than they expected.
Seven years after its debut in Italy, the American pizza giant formally closed its stores after failing to win over consumers who prefer local options, Milano Today reported.
EPizza SpA, the operator of the Domino’s franchise in Italy, filed for bankruptcy in April after failing to meet its sales targets during two years of pandemic restrictions, according to a document filed with the Milan court.
The company shut down all Domino’s branches on July 20, according to a report in Food Service, an Italian food industry publication.
While some may attribute Domino’s defeat to its brazen attempt to infiltrate the homeland of pizza with its American offering, ePizza claims the failure was due to competition from food delivery apps.
The Milan-based company faced “unprecedented competition” from local restaurants that started using delivery services like Glovo, Just Eat and Deliveroo during the pandemic, according to the document filed with the court.
Domino’s said in a document, also filed with the court, that ePizza’s difficulties last year were the result of “a significantly increased level of competition in the food delivery market from both organized chains and local restaurants that delivered food.” food to survive.
The company also said it had run into trouble once some of the pandemic restrictions were lifted and consumers began flocking to more traditional restaurants.
The Milan court granted a 90-day grace period to the company, in which creditors could not demand payment or seize its assets. That period expired at the beginning of July.
Domino’s had high expectations when it entered the Italian market in 2015, signing a 10-year franchise agreement with ePizza. The company had plans to introduce a large-scale delivery service, which was non-existent in the country at the time, according to the court filing.
By the beginning of 2020, ePizza managed 23 branches in Italy and six more through a concession to another partner.
Domino’s and ePizza did not immediately respond to CNN Business’ request for comment.