Making the complex look simple: Don Meij's top ingredient for success

Before becoming the CEO of a multinational pizza chain with a market cap of $5.7 billion and a presence in each global region, Don Meij was a teenage entrepreneur. And later, a pizza delivery driver. His first business venture was a window-cleaning business and he also operated a Coles checkout for a period.

Fast forward 35 years and Meij is the head of Domino’s Pizza Enterprises (ASX: DMP). How did he get here? Meij delved into his background, business philosophy, and outlook for Domino’s into 2024 and 2025 during a recent sit-down with Centennial Asset Management’s Matthew Kidman.

Some aspects of the Domino’s CEO you might be unaware of include:

• He was initially headed for a career as a schoolteacher.
• His first supervisory role was as the head of a fruit and vegetable division at a Coles store.
• He was a delivery driver for Silvio’s Dial-A-Pizza, a pioneer of Australia’s fast-food home delivery.
• Japan and Germany, two of Domino’s Pizza’s newest markets, are where he sees the most growth potential currently.

“Like magic to me”

For Meij, reading his first profit and loss statement – as a Silvio’s store manager – was an eye-opening experience.

“The very first time I saw one, it was just like ‘wow, this is how you make money!’ It was so simple – you have this big area called food, this big area called labour, and these other things called costs,” Meij says.

“The more you take the top up, the fixed and semi-fixed costs were the same, and more just flowed through to the bottom. It was like magic to me, something so simple.”

What attracted him to the pizza business?

Reflecting on his early years with Silvio’s – which would later become Domino’s Pizza Enterprises – Meij suggests it was this simplicity and the prospects of success that drew him to the business.

“I got excited that if you looked after customers and more of them came back, and it was so much fun because it wasn’t that hard,” he says.

“These are very simple principles. Just make a pizza, deliver it quickly and make sure you time it right so it’s never cold.”

Meij also reflects on the team-building process of running a Domino’s pizza restaurant – borrowing from his experience of playing team sports in his youth – and the measurability of the business as other attractive features.

“You could see it, hold it and up until that point, I hadn’t been in charge of much, in terms of being in control of a team to get an outcome.”

Meij says he often tells people these principles – and the lessons he learned back then running his first franchise – remain core to the way the multi-billion-dollar business runs today.

“One of the dangers in business is that managers forget they’re actually in the business of creating products and services,” he says.

“The cleaner, simpler you keep business – you’re not putting all this energy into the business of running the business – the more energy goes into creating products and services.”

Meij calls out a couple of global entrepreneurs – including Elon Musk of Tesla and the late Apple founder, Steve Jobs – as people he’s tried to learn from. In both cases, he’s astounded by the way they took on complex, multi-faceted technology companies and distilled them down to the simplest elements.

“I’m watching Elon Musk take on Twitter and he takes things that look so complicated and simplifies them into very easy, common-sense speak. He’s not getting up there and giving you a Harvard Business or consultant story. It’s amazing to watch,” Meij says.

“They make the most complex things look so simple, and that’s part of the secret.”

How DMP changed after its IPO

One of the first milestones of the business now known as Domino’s Pizza Enterprises was Silvio’s 1993 acquisition of the struggling pizza business, after which the firm is now named. The move to drop Silvio’s brand in favour of Domino’s in 1995 is something for which Meij himself was a fierce advocate.

And in 2000, Meij combined the equity of his 17 stores with those of Grant Burke, a board member who remains one of the largest shareholders, who owned eight stores in Newcastle – to buy 20% of the company.

“We then bought out the last shareholder, so owned 25% each, and then the Cowan family (headed up by Jack Cowin of Hungry Jack’s fame) owned 75% in 2001. That’s when I became the CEO of Domino’s Pizza Australia.”

Reflecting on the competitive environment at this time, Domino’s in 2000 made $1 million in EBITDA from 174 stores.

Competitor Pizza Hut operated 427 stores, and Pizza Haven – which Meij describes as “a pizza hut ripoff” – had 284 stores.

Another company that was wound up in ensuing decades, Eagle Boys Pizza, owned 168 stores.

“In two years, we became the market leader. Pizza Hut closed, and everything we’d learned as franchisees we applied to the bigger picture,” says Meij.

“Then we entered New Zealand and became the leader there."

The ASX listing of Domino’s Pizza Enterprises in 2005 is arguably the firm’s defining moment. And as Meij recalls, the company was still losing money in New Zealand at that point.

“We were still in building mode, and we were losing money in Melbourne too. And yet we were listing this business because, by and large, it was still on the right trajectory, as time has proven,” Meij says.

The life of a listed company

The additional brand exposure was one of the biggest benefits of the IPO, explains Meij.

“We would put our results out and get millions of dollars worth of free media because it wasn’t long until everybody had an opinion on Domino’s.

“Whether they were making it up or they were right, it didn’t matter, because they talked about Domino’s constantly. It was this new thing in the market, and there was no other fast-food company listed in Australia in 2005.”

On the other hand, this exposure also became a distraction for the small-cap business when it didn’t yet have an investor relations structure.

“It was still mostly positive, but it wasn’t until we became a large cap, and our multiples were so high that you started getting contrarian views that also wanted to make their views right in the press and in the public,” Meij says.

“That was very different learning because we hadn’t been exposed to that while we were a small cap.”

What the future holds

The company’s ongoing campaign in Europe remains a big area of focus for Meij and his team. As it was eyeing offshore expansion opportunities, “we just decided we were 100% all-in pizza and acquired the three markets of the Netherlands, Belgium and France.”

For the 8.7 million Euros / $12.4 million purchase price, the initial big prize here was thought to be France, with the additional markets of the Netherlands and Belgium included with the deal.

“But with the same combined population of Australia and New Zealand, and in our business, territory is worth everything. So, when somebody’s offering two countries – absolutely,” Meij says.

“And as it turned out, the Benelux (Belgium, Netherlands, Luxembourg) in that first decade was the most successful part of Europe. And yet it was the free part, and half our leadership around the world today has come out of there.”

He concedes that France, which is the second-biggest pizza market in the world by total aggregate consumption, has been a rocky road for Domino’s.

“It’s still a big opportunity but, in fairness, we’ve executed quite well relative to that market,” Meij says.

Another large European nation, Germany, is one where the company continues to focus on ramping up.

“You can add up all the chains in Germany and we’re still bigger, and we’re the only national chain there,” Meij says.

Similarly, Japan is a market Domino’s is trying to crack – but already holds a bigger share of the country’s pizza market than the other two chains combined.

“We arrived in Japan as the number three player - and in some markets, we’re five times bigger, like here in Australia – and we weren’t the leader on day one.”

This is a conscious part of the company’s “high volume mentality” approach.

“We’re entrepreneurs when we travel, we’re not Australians, because there’s nothing more offensive to any culture than to say, ‘in Australia, in Australia, in Australia’ when someone looks out the window and says, ‘it looks a lot like Japan.’ Our competitors are French, German, Dutch and so on.”

“A blind spot in Asia”

Meij regards Asia as a market that’s largely undervalued by investors.

“There’s still a blind spot from investors on Asia, regarding it as different and with a view ‘that they don’t eat pizza’. Yes, but they also didn’t eat hamburgers 50 years ago, either” he says.

“If you constantly pursue these questions about what holds us back and keep pounding away at these things, we’ve had a history of breaking through”

Where to from here?

Kidman closes out the interview by asking Meij about his outlook for Domino’s – especially given he’s just signed on for another five years and has expressed a view that he would happily sign on for another 15.

“What we’ve learned, in becoming a mid-cap or whatever you want to call our size, is that you need to be very clear on the intent. I want to be here as long as the other stakeholders want me,” he says.

“I still think that the 3% to 6% same-store sales and our 8% to 11% store count in a three to five-year window is quite realistic.

Meij says that over the next 12 months, Domino’s isn’t actively pursuing new countries, having just taken on four new ones and three others coming in the next few weeks.

“This year there will be a lot of organic growth, a lot of buckling down. We’ll take another look in 2024 or 2025 at other geographies.”

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