Domino's Pizza franchisees say a new campaign promoting a no-questions-asked guarantee has led to a spike in unfounded complaints.
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'If you're not a favourite, you're going to lose'
Consumer advocate Michael Fraser on the Domino's pizza franchisees.
The campaign, introduced in May, is aimed at raising the quality of pizzas and promoting the company's 100 per cent money back guarantee which is printed on the side of each pizza box.
Complaints which aren't resolved with a store directly can attract a fee of between $5 and $30 which the franchisee pays to Domino's head office. Franchisees say they are being stung twice – forced to pay for replacement dishes or refunds, and the fee.
Fairfax Media spoke with a number of franchisees who say they have seen marked increase in complaints, but did not want to be identified fearing repercussions from Domino's head office.
"We are happy to pay if there is genuine complaint, but now the number of complaints have increased more after the campaign and we can see the history [of the complainant], and you can see a lot of complaints for no reason," said one franchisee.
"We are not happy because the customers are not always right."
Another current franchisee said the campaign was "definitely" having having an effect.
"People are taking advantage, it is definitely impacting" he said.
A third franchisee said he is seeing more spurious complaints, particularly around estimated delivery times.
"When we say delivery is going to take 20 minutes, people complain if it then takes 21 minutes," he said.
Domino's Facebook and Twitter feed is littered with complaints ranging from inaccurate delivery times to poor quality pizzas, with some requesting free food as compensation.
We are not happy because the customers are not always right.
Domino's franchisee
"Bought a pepperoni pizza last week maybe had 8 slices of pepperoni on it, any chance for a pepperoni pizza for free today?" one complainant said.
"I would enjoy a free pizza but i hope its not burnt this tim ," reads another.
A spokesman for the company denied there had been an increase in complaints related to the campaign, adding that this was Domino's busiest time of year.
He said the complaints handling fee, introduced in June, which replaced an earlier system, resulted in an average cost saving for franchisees per complaint which was around $12. He said Domino's only steps in when a dispute cannot be resolved with a store directly, and that the fee helps fund a 24-hour-a-day social media team.
It follows reports Domino's is seeking to ease the financial pressure on franchisees, amid claims some stores are struggling to make a profit.
Last week Michael Simotas, an analyst with Deutsche Bank, reported the pizza giant was reducing the size of its pizzas, and switching cola brands from Coca-Cola to Pepsi/Schweppes.
"For Domino's, we expect that this transition will lead to lower food costs for franchisees," he said.
Asked whether it was reducing the size of its pizzas, Domino's said it was working on an "enhanced menu to cater for our customers' diverse taste requirements, including new pizzas, sides and desserts."
"Domino's will continue to provide premium ingredients, new flavours and traditional favourites at prices that provide exceptional value for money," a spokesman said.
It comes at a time when the fast-food giant is being accused of taking a large slice of franchisee profits.
In May, Deutsche Bank downgraded Domino's to a "sell" rating, and said store owners were getting a raw deal compared to their UK and US peers.
Last month Citi also downgraded the stock to "sell" and said "Domino's needs to share more with franchisees".
A Fairfax investigation revealed in February between 4 and 21 per cent of Domino's businesses in NSW were operating below break-even point, based on six weeks of sales data.
At the time Domino's said the figures were "materially incorrect," and insisted its businesses are profitable.