How to reinvent franchising with tech and transparency

We’ve just opened our 300th pizza shop. Ta-da! To be honest, none of us can fully process this number. But we should—if we mean to stay in business.

Fast growth cannot be sustainable if you don’t evolve at an even faster pace and adapt to new challenges that present themselves when you get to the next level.

Our team has reached a landmark, and we have a feeling that the company now needs to revamp its strategy and rethink its principles.

Here is a recap of what we’re going to do differently in 2018.

Moving to top locations

The very first Dodo Pizza started in a basement of a building that was located in a low-traffic area. This didn’t impede the pizzeria from showing $100,000 in monthly sales, though. Most of our partners followed suit, usually opting for cheaper locations. Now this practice must stop. Dodo Pizza is the market leader. We have superb product, design, and brand, so we should occupy the best locations in every town.

Reducing delivery areas

For the first few years, it made sense to draw them pretty wide to secure enough sales by increasing the number of potential customers. Now our product has significantly improved, and we know much more about  attracting loyal customers. At the same time, the Russian pizza market gets more competitive, and our initial guarantee of a 60-minute delivery doesn’t look that enticing anymore. Reducing the delivery areas will allow us to ensure faster service and make our marketing efforts more efficient.

Saying goodbyes

Not long ago, we didn’t have a national brand—just dozens of pizzerias scattered across Russia. Now we are present in almost every significant city. This spring, we will also launch our very first national campaign. So even just a few partners who don’t pull their weight can damage our brand. That’s why we need to double down on quality control and let go of those who can’t provide the best service to our customers. Even if it entails closing a few locations. That’s something we haven’t ever done before—and that’s exactly what we must start doing.

Unifying our management

For the first few years, we didn’t control how our partners managed their teams. We shared our best practices with them, but left day-to-day management up to them. Now we understand that ensuring the same high level of quality in the chain can’t be achieved without a unified management system. We have to endure a painful process of changing the management habits of our partners (some of whom are pretty experienced and established in their practices) and bring everybody to the same page. We started this process in 2017 and will continue it in 2018.

Changing our own ways

In 2017, we failed to reach our goal—Dodo Pizza aimed to end the year with a chain of 400 pizza shops. Along with our partners, we also need to rethink how we set goals and manage our team. How do we preserve the free spirit of a startup and balance it with the discipline of a corporation?

Our current working hypothesis: our internal teams need 3‑month plans instead of year goals, and they must be established by themselves (instead of getting them from the CEO).

Finally, they have to share their goals with each other to make themselves accountable for the results. In January, we carried out the first strategic session. The leaders of Dodo teams spent a Sunday in our Moscow headquarters to work on their goals and present them to others.

Clearing up our global strategy

Dodo Pizza is now present in 9 countries besides Russia. Most of them appeared in our portfolio, not because of some genius plan of ours. At some point, different opportunities surfaced and we seized them (for example, a passionate and like-minded entrepreneur showed up on our doorstep asking to make a partnership—that’s how we ended up in Romania).

We have a clear vision of what we need to do. We have venture markets where we’re still learning the ropes and searching for a sustainable business model (US, UK, China). In the Eastern European markets, such as Estonia or Romania, we’ve already found this successful model, so these countries need developing.

And there is the market of Russia and Kazakhstan where Dodo Pizza is the leader. Our job there is to scale fast and efficiently.