When David Wild announced plans to step down as chief executive of Domino’s Pizza’s in the UK after five years at the helm, shares in the takeaway firm spiked 8pc. At the time, analysts suggested that the brutal market reaction signalled a sigh of relief among investors that he was off. However, more than six months later and Wild is still chief executive; his departure delayed by the retirement of former chairman Stephen Helmsley in December, who Domino’s is still trying to replace. Wild has faced an uphill battle over the past two years to resolve a bitter row with franchisee store owners amid reports that he is “impossible to work for” because of his “hard-man” behaviour. Reported issues with his style are said to have contributed to the resignation of three finance directors in as many years. And just last week the group confirmed it will sell off its loss-making Norwegian business after a disastrous overseas expansion, led by Wild, which will see Domino’s also exit Sweden, Switzerland and Iceland soon. When Domino’s arrived in the UK 25 years ago from the US, management expected the group to open a maximum of 100 stores. But a growing trend toward longer working hours combined with the immediacy offered by the internet has meant demand for takeaway pizza and other fast food has increased rapidly. Domino’s now has almost 1,200 sites across the UK and Ireland which deliver a combined 100 million pizzas each year, equivalent to more than six every second. Slow decline Wayne Brown, analyst at Liberum, says: “Domino’s is an incredibly good business, so it has taken some time for the cracks to start developing. “Over the last five years, there’s been a lack of leadership in the management team. There’s been no franchisee support, or at least ability to have a decent relationship with the franchisees. “There has been no innovation in the food and no investment in its IT systems to combat the growth that you’re seeing from rivals and changing consumer habits and trends. “But what hasn’t happened is a complete failure of the business. And that’s testament to the strength of the model.” Nigel Parson, analyst at Canaccord, agrees: “Domino’s has been until recently the stock of the decade, so you are talking difficulties against a phenomenal background.” One of the biggest setbacks to Domino’s UK operations has been its long-running feud with franchisees. The row has hurt Wild’s ambitions to open hundreds more sites across the UK, bringing the total to 1,600, as franchisee store owners drag their heels over new openings and demand a bigger slice of Domino’s earnings to combat higher food costs, business rates and pay. While sales continue to grow at Domino’s as franchisees hike customer prices to protect their margins, analysts note a gradual deterioration in orders. Liberum’s Brown says unless the dispute is settled, Domino’s risks damaging the long-term performance of the business. “The franchisees want respectable, professional, responsible landlords of that brand to be able to negotiate with,” he says. “And I’m not necessarily seeing any signs of that taking place. So until that starts to happen this company is in deep trouble. “Whilst we are not necessarily seeing a huge drop off in the performance of the business, unless positive investment occurs and a positive change in psyche in the PLC, it will happen.” Analysts suggest Domino’s could learn from fast food rivals such as McDonald’s and Greggs which have invested heavily in technology to improve customer service. Imitation is the sincerest form... Parson says: “McDonald’s are moving from mass production of products to what they call mass personalisation, so that when you appear in your car in a McDonald’s drive-thru, they recognise you and know what you like to eat and suggest menu items that prompt you to spend more money. “There is some of that capability at Domino’s but it can get better.” The food delivery sector has changed drastically over the past decade, as the so-called aggregators such as Uber Eats and Deliveroo give customers access to a wider range of food options delivered to their door. Brown suggests distractions relating to Domino’s franchisees and overambitious expansion plans mean the company has neglected to invest in technology to give it the edge over competitors. “The fact that Domino’s haven’t properly invested in technology in the last 10 years is flabbergasting, that’s exactly the problem,” he says. “Of course there’s more competition so you’ve got to fight harder, you need more innovation not less. “At the end of the day, Domino’s is still the leader in UK delivered pizza, massively the leader. It could dominate to a much greater extent. There’s lots of opportunity there.” A spokesman for Domino’s said: “The situation with our franchisees is complex and we remain committed to working with them to agree sustainable solutions.”