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1. Note: the following case is copyrighted and may be copied and used only by current users
and owners of the textbook, BUSINESS ETHICS: CONCEPTS AND CASES by Manuel
Velasquez.
Domino’s Delivers
In May 1993 Domino’s paid $2.8 million to settle a lawsuit brought by the family of 41-year-old
Susan Wauchop who was killed when her van was struck by a Domino’s delivery truck being driven on a
highway in rainy weather.1 The family alleged that the 19-year-old driver was speeding to meet Domino’s
guarantee to deliver a pizza within 30 minutes. Domino’s argued that weather and road conditions were
the real cause of the accident and refused to change its 30-minute guarantee. Not only was the guarantee
popular with its customers, it also set Domino’s apart from its numerous rivals in a highly competitive
and crowded business.2
Domino’s Pizza was founded in 1960 when two brothers, Tom and Jim Monaghan purchased a pizza
store in Ypsilanti, Michigan. A year later Jim traded his half of the business to his brother for a
Volkswagen Beetle and Tom Monaghan became sole owner.
By 1983, the company had expanded to 1000 restaurants. Ten years later the company was well on its
way to owning over 4000 outlets within the United States, and over 500 outside the United States. In
addition, over 1000 Domino’s Pizza restaurants were owned by others as franchise operations. Domino’s
had become the fastest growing pizza company in the world. Analysts felt that the key to Domino’s rapid
expansion was a promotion that it launched in 1984: guaranteed 30-minute delivery. Initially, the
company advertised that if pizza was not delivered within 30 minutes it was free. This was later changed
to a guarantee of delivery within 30 minutes or a $3
refund.
The company required all franchisees in the United States to sign a contract agreeing to use the 30-
minute guarantee. Driver training manuals made the importance of speed clear: “Speed is vital. For
Domino’s the deadline is 30 minutes. After 30 minutes, the hungry customer begins to get restless. After
40 minutes, he gets worried. After 50 minutes, he gets irritated. After an hour he explodes.” The manuals
also emphasized safety, however: “Know one thing for sure: FAST DELIVERY DOES NOT COME
FROM SPEEDING AND RECKLESS DRIVING ... without a doubt, reckless, illegal driving does not
profit the shop.” To allow drivers sufficient time to make their deliveries, the company adopted a policy
of “Go fast in the shop, go slow on the road.” A pizza made from fresh ingredients should be in the oven
within two minutes of a phoned-in order, and in its box within eight minutes, allowing the driver 22
minutes to meet the 30-minute deadline. In addition, outlets were not to guarantee delivery to an area
more than two or three miles away.
Shortly after the 30-minute guarantee was put into place in 1984, the company began to get
complaints that it was encouraging unsafe driving and some accidents involving Domino’s drivers resulted
in small lawsuits that the company settled out of court. The company began to fire managers who failed
to pay attention to safety. Supervisors had to be certified as defensive driving instructors. The company
began using safety training tapes, and safe driving training was required of all drivers, who also had to pass
safe driving tests. No applicant was hired if he had a moving violation within the previous two years. A l l
drivers were required to take defensive driving classes. The company publicized all of these new safety
programs.

2. The importance of the 30-minute guarantee to Domino’s was evident in a 1989 study of pizza chains
in South Carolina which suggested that Domino’s had little competitive advantage over other pizza
restaurants besides fast delivery.3 Pizza Hut provided eat-in facilities with high levels of service, home
delivery, a pizza rated as “medium/high” in quality, prices that were above Domino’s for plain pizzas but
below Domino’s for pizzas with several toppings, several sizes and types of pizzas, beer, and numerous
other Italian dishes on its menu. Little Caesar’s provided take-out only with no sit-down or delivery
services, a “medium” quality pizza priced a few cents above Domino’s, sandwiches, and soft drinks but no
beer. Schiano’s had eat-in facilities with extremely high service levels but no delivery, a very high quality
“New York” style pizza priced at about Domino’s level, beer, wine, soft drinks, and a wide variety of
Italian dishes and sandwiches. Pizza Factory provided take-out and eat-in facilities but no delivery, no
waiters and such low service levels that a pizza rated as “medium” in quality and priced a few cents above
Domino’s for plain cheese but below Domino’s for pizzas with several toppings, beer, soft drinks, and
sandwiches. Pizza Delights offered home delivery, take-out and eat-in facilities with high levels of
service, pizzas rated as “medium/high” in quality and priced above Domino’s for plain cheese but below
Domino’s for pizzas with many toppings, beer, soft drinks, sandwiches, and a small number of Italian
dishes. Pizza Inn offered eat-in dining with high levels of service, take out, and home delivery, a pizza
rated as “low/medium” in quality, prices below Domino’s, sandwiches, several Italian dishes, beer, wine,
and soft drinks. Domino’s had no eat-in facilities but offered very fast home delivery as well as take-out, a
single kind of pizza that came in two sizes and was rated as “low/medium” in quality, soft drinks but no
beer, and no other menu items. While its prices for plain cheese pizzas were below average, its prices for
pizzas with numerous toppings were above.
Criticism of the 30-minute guarantee continued to mount. In 1989, the director of the National Safe
Workplace Institute, a nonprofit organization based in Chicago, claimed that in 1988 Domino’s drivers
were involved in 100 accidents resulting in 10 deaths.4 The following year the Institute announced that
there were 20 deaths involving Domino’s delivery cars in 1989 and that some 140 accidents—at least 20 of
them involving fatalities—had resulted in lawsuits against Domino’s since the 30-minute guarantee was
first initiated in 1984. The director of the institute alleged that the company’s 30-minute guarantee was
responsible for many of the deaths.5 (In 1989 and 1990 Domino’s had a total of about 80,000 drivers
working for the company.)
In early 1990, Domino’s developed a new 14-part safe-driving program for its drivers. In July of that
year, the company began attaching letters to pizza boxes explaining that the company was devoted to
speed in the kitchen, not on the road.6 The company also said that it had conducted studies to see whether
its guarantee was a significant cause of delivery accidents and had found that accidents had been caused
primarily by road and weather conditions and by drivers falling asleep at the wheel, not by speeding
attributable to the guarantee. Nevertheless, an employee testified during a trial in Pennsylvania that at the
outlet for which he worked a driver who met the 30-minute deadline with four pizzas in an hour got a
bonus of 1 percent of those sales, while drivers who missed deadlines were given only one or two pizzas to
deliver thus preventing them from making what the faster drivers made in tips. Another driver claimed
that “The 30-minute policy would push me to do things I normally wouldn’t do, like going 50 mph in a 40
mph zone.”7 Critics also alleged that the compensation system provided an incentive for drivers to
deliver as many pizzas as possible during a work shift. Although drivers received the minimum wage of
$3.35 an hour and a mileage reimbursement, the bulk of their pay came from tips which increased as the
number of pizzas they delivered increased.

3. In late 1990 Domino’s installed a toll-free number that people could call if they saw a Domino’s
employee driving recklessly. The company also hired behavioral scientists to revamp its driver-safety
program. And the company had all employees watch a video tape in which Suzanne Boutrose explained
how unsafe driving had led to her son’s death. The company’s mission statement, which indicated that the
fundamental goal of the company was “to be the leader in delivering off-premise pizza convenience to
consumers around the world,” stated that as part of meeting this goal the company was committed to
“placing team member [employee] and customer safety and security above all other concerns.”
QUESTIONS
1. Compare the various pizza restaurant chains. Do you agree that fast delivery is the only competitive advantage
Domino’s has? If so, explain the implications.
2. Imagine you were a Domino’s manager and had to answer the question: Should Domino’s continue to maintain
its 30-minute guarantee? If not, then what do you suggest the company should put in its place to survive? If it
should continue, then what should the company do that it has not yet done to deal with the reckless driving
accusations? Explain your recommendations fully, including all the moral factors involved.
3. In your judgment, is Domino’s morally responsible for the deaths cited in the case? Explain your answer.
NOTES
1. “Domino’s Pizza to Pay $2.8 million in Crash,” Chicago Tribune, 12 May 1993.
2. Michael Clements, “Domino’s Detours 30-minute Guarantee,” USA Today, 22
December 1993, p. 1A.
3. Jay Horne, Christine Perkins, Kim Goates, Peter Asp, Ken Sarris, John Leslie, and James J. Chrisman,
“Pizza Delights, Inc.,” in Michael J. Stahl and David W. Grigsby, Strategic Management for Decision
Making (Boston: PWS-Kent Publishing Company, 1992).
4. Roderick Oram, “Live Fast and Die Young in America’s Speedy Pizza Business,” Financial Times, 16
September 1989, p. 2.
5. “Judge Lifts Wraps in Domino’s Case,” Chicago Tribune, 27 August 1991, p. C3.
6. Jenise Griffin Hill, “Domino’s Is Sued by Family,” Orlando Sentinel Tribune,
2 November 1990, p. 1.
7. Jeff Testerman, “Fast Pizza Runs Into Trouble,” St. Petersburg Times, 17 January 1994, p. 1B.