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The Honolulu Advertiser
Posted on: Friday, January 11, 2002

Hawai'i firm to sell Domino's franchises

By Andrew Gomes
Advertiser Staff Writer

A partnership of Domino's Pizza franchisees in Canada and the Mainland has arranged to buy 18 Domino's stores on O'ahu and Maui from Ernest Higa of Higa Industries Hawaii Inc.

Ohio native Michael Schlater, a former Domino's delivery driver who today owns about 100 stores from Alaska to Michigan, is leading the purchase.

The deal is scheduled to close March 11. A price was not disclosed. Two Domino's stores on the Big Island not owned by Higa Industries are not part of the purchase.

All 344 Higa Industries employees at Domino's will be retained, according to Schlater, who said he plans to hire more people to increase marketing and open another 13 to 15 stores on Maui and the Big Island.

Partnering with Schlater to operate the Hawai'i stores are Doug Atkinson and Clay Batke, owners of four Domino's stores in Vancouver, British Columbia.

Officers at Higa Industries could not be reached for comment yesterday. Schlater said Higa, who was born in Hawai'i and owns about 200 Domino's stores in Japan, wanted to focus on his Japan business.

"I know Ernie didn't want to sell (the Hawai'i stores)," Schlater said, "but he has his hands full. Ernie gave us the opportunity, and we're very thankful."

Higa bought the Hawai'i pizza franchise in 1992 from Michigan-based Domino's Pizza after he had established himself as the most successful international franchisee in the Domino's system with what was then about 90 stores in Japan.

Schlater was Domino's Pizza's first international franchisee in 1983 when he opened a store in Winnepeg, Manitoba, using $5,000 of savings from delivering pizzas in Ohio plus $10,000 borrowed from his brother.

Schlater grew his Canadian franchise to 40 stores, but recently sold half the operation, and since last May has bought more than 80 Domino's stores in the United States. "We've decided to really hit the American market harder," he said.

With the Hawai'i acquisition, Schlater will own 125 stores in eight states and Canada.

Domino's Pizza, founded in 1960, has about 7,000 company-owned and franchised stores worldwide that had sales of $3.5 billion in 2000.

Reach Andrew Gomes at agomes@honoluluadvertiser.com or 525-8065.