The dip in dining-out dollars has been a boon for certain menu items—and pizza is one of them. Pizza sales are going strong and pizza-centric chains are in growth mode. What’s more, entrée pizzas are now served in 30 percent of all restaurants, according to Datassential MenuTrends Direct.
The dip in dining-out dollars has been a boon for certain menu items—and pizza is one of them. Pizza sales are going strong and pizza-centric chains are in growth mode. What’s more, entrée pizzas are now served in 30 percent of all restaurants, according to Datassential MenuTrends Direct.
“Pizza is a communal, comfort food,” says John Arena, co-owner of the five-location Metro Pizza in Las Vegas. “People are looking for a social food experience when they go out to eat today,” adds Jack Butorac, president and CEO of the 199-unit Marco’s. “Pizza equals value during tough economic times.” It’s also a value for operators. Even with higher ingredient costs, pizza delivers good profit margin.
Making a pizza can involve many purchasing decisions. Prepare dough from scratch or buy frozen balls or sheeted doughs? Fresh mozzarella logs or pre-shredded cheese? How thick the pepperoni and how large the sausage chunks? The permutations are numerous, but these operators have figured out smart strategies.
Russell Bellanca, President, Alfredo of Rome and owner Trattoria Cinque, NYC
What we purchase: We go to great lengths to bring in products from Italy, including lardo from Colonnata, guanciale (pork jowl), pancetta and canned San Marzano tomatoes. We use fresh mozzarella but not mozzarella di bufala; it is too soft.
Point of differentiation: We were the first to menu brunch pizzas with eggs. Our pizzas are in the thin-crust Roman style—we’re not about dumping lots of product on top. I believe there’s an overuse of cheese on pizzas in this country.
Equipment: Basic oven with pizza stone.
Challenges: Pricing on pizza has to be low because people perceive it as a less expensive menu item. To add to the perceived value, we present our personal-size pizzas on a wood board.
Buying tips: Our toppings use less product but better product and we take a slightly lower profit margin on our pizzas.
What’s cooking: We’re thinking about a cheese-less pizza for the lactose-intolerant and more vegetarian and dessert pizzas.
Bill Hancox, VP of Food Services, Boston’s Restaurant & Sports Bar, Dallas, Texas
What we purchase: We start with privately blended flour and fresh cake yeast for our crust. We contract to buy tomatoes all at once, off the first crush. Our mozzarella is very specific—partially skim, purchased in 10-pound blocks from Laprino Foods.
Point of differentiation: Our pizza is a happy medium between New York crisp-crust and Chicago deep-dish. The dough is our unique piece; it’s mixed at each store.
Equipment: Lincoln impinger ovens. We switched from a deck to conveyor oven for more consistent results.
Challenges: Consistency. We analyze our flour periodically to make sure the percentages of wheat are the same. Toppings like pepperoni, ham and sausage are all made to spec by our vendors. Solid partnerships with our suppliers assure success.
Buying Tips: Cheese prices were very high about a year and a half ago, but then we saw a big drop. We thought it might be speculation, so we priced against the New York Cheddar block market and it worked. We’re buying quality mozzarella at 3 to 8 cents lower than the house brand.
What’s cooking: In 2009, we introduced a whole-wheat crust, and Florentine pizza on whole wheat is now our number two seller. In response to customer demand, we also added a gluten-free pizza and it’s really been embraced by celiac groups. We’re also doing more veggie pizzas, using large pieces of vegetables and fresh herbs.
John Arena, Co-owner Metro Pizza, Las Vegas, Nevada
What we purchase: Mostly American products—the best in the world! Fresh mozzarella, vine-ripened tomatoes from Modesto (picked and packed by Stanislaus), sausage and U.S. milled flour.
Point of differentiation: People come from all over the world to Las Vegas, so we have to offer many pizza styles. Besides the classic New York/Little Italy version, we have stuffed pizzas, Neapolitan, Chicago-style and regional pizzas like the New Haven (topped with clams and garlic).
Equipment: Gas-fired hearthstone deck oven.
Challenges: Competing for share of stomach. We price our pizzas fairly—$8.50 to $24 (a stuffed pizza for four)—considering that they are hand-crafted with top ingredients; we even put the tomato fillets through a food mill to get the right consistency. But grocery stores are becoming mini-restaurants and very competitive.
Buying tips: We conduct blind product cuttings to compare items like San Marzano tomatoes with the California-grown Stanislaus. The former are imported and we can’t oversee the packaging process; we have seen the latter and the tomatoes spend very little time between vine and packing plant. In our cuttings, the California tomatoes always come out ahead in flavor, texture and color.
What’s cooking: We’re buying more American specialty products. There are some great artisanal salami makers right in California.
Mabelissa Acevedo, EVP Franchise Development, PizzaVito, Gainesville, Florida
What we purchase: Our dough is made fresh by our supplier and frozen in pre-measured balls. Each location thaws and flattens the dough balls in a press to create uniform 14- and 20-ounce pies. The sauce is a family recipe made with Jersey tomatoes; it’s canned and labeled for us by our vendor partner. We use diced, 100 percent mozzarella—no cheese blends.
Equipment: Ovens lined with bricks on bottom, sides and top.
Point of differentiation: Our dough company uses New York City water to give our pizza crust its authentic flavor and nice crispy texture.
Challenges: Make sure we stay focused on quality so we can offer premium pizza at an affordable price [range is $10.95 to $23.95]. Fluctuations in commodity prices are also a challenge; cheese, especially, has gone up considerably in the last 2½ years.
Buying tips: We use national food distributors so we can negotiate good prices for all our franchisees. PizzaVito currently has five stores, but we have over 65 franchise developments signed. Our distributors want to grow with us.
What’s cooking: We listen to our customers for topping suggestions. Our latest is BBQ Chicken Pizza.
Jim Freeland, Corporate Chef and Pedro Barrera, Director of Kitchen Operations, Lou Malnati’s, Chicago
What we purchase: Dough is made from scratch as needed, using custom blended flour from a Midwest supplier, locally blended oil and Lake Michigan water. Cheese comes from a small dairy in Wisconsin; sausage is ground daily according to a family recipe. We meet with our tomato packers in California during the summer harvest to make sure the tomatoes coming off the truck are the right color, flavor and sweetness.
Point of differentiation: Lake water and hand patting the dough give our crust its signature flavor and flaky texture. Our Chicago pizza is big and dense—it weighs up to 6 pounds.
Equipment: Deck ovens lined with ceramic and slate. They’re old-school—not the fastest, but the best.
Challenges: Although guest visits are down slightly, we’ve remained very loyal to our customers; it’s not right to raise menu prices in this economic climate. But we’ve ramped up our mail order business and introduced an appetizer pizza to appeal to patrons who want to eat and spend less.
Buying tips: We can hedge on oil and flour, but the cheese market is very volatile—you have to catch it on its way up to get a good price.
What’s cooking: Our new Caprese pizza is lighter and fresher—people are enjoying it as a starter. We use the same pizza crust but pat it thinner, then top it with pesto, fresh BelGioioso mozzarella, fresh basil and a bruscetta mixture.
Jack Butorac, President and CEO, Marco’s, Toledo, Ohio
What we purchase: Our signature sauce is a family recipe; we contract with a supplier to produce it. We top the pizzas with a blend of three cheeses, shredded to our specs by two companies. We use a thicker, customized pepperoni slice and large sausage chunks.
Point of differentiation: We offer three pizza styles: Pan, Classic and Thin Crust. The first two use fresh dough made daily, and the third [uses] sheeted dough manufactured for us. To come up with menu ideas, we rely on a team from operations, marketing and purchasing, plus our vendors and franchisees.
Equipment: Conveyor or belt oven.
Challenges: Be sensitive to regionalization. Fans have different desires in different places. In Colorado and California we’re trying more local sourcing.
Buying tip: To stabilize fluctuating cheese prices, we take out contracts with our suppliers. Our vendors have been aggressive in providing economical products for our franchisees and making their R&D staffs available.
What’s cooking: The recession [has] been good for finding locations, getting lease improvements and expanding.
The ups and downs of cheese prices
In 2008, mozzarella spiked to $2.45 per pound wholesale—a price that left pizza makers down in the dumps. Although prices dropped in 2009 to a low of $2.10 in July, they have since climbed again. “Cheese is still significantly higher—about 70 percent—than it was about six months ago,” claims Jim Freeland of Lou Malnati’s in Chicago.
It’s tricky to manage costs with no futures market in cheese, explains Brian Gould, associate professor in Agricultural and Applied Economics at the University of Wisconsin-Madison. Buyers can look at milk, butter and whey futures market or the spot cheddar market and extrapolate, but won’t necessarily get an accurate forecast. Instead, Gould suggests taking a “wait and see attitude” for 2010.
“Don’t set any long term minimum cheese prices until we see where the economy and milk production are trending,” he says. “Maybe prices started to rise in 2009 because the economy began recovering and demand increased. But if milk production goes up, there might be downward pressure on prices.” The good news: cheese prices should be relatively stable or going up only slightly in 2010, Gould predicts.
Notes from the supply side
Many pizza concepts work closely with their vendor partners to source proprietary products, assure system-wide consistency and differentiate their menu. And non-pizza operators who want to include pizza as part of their menu mix often rely on labor-saving sheeted doughs, prepared sauces, sliced meat products and other toppings that manufacturers provide. Here’s an update on the category.
Personal-size pizzas. There’s a trend toward smaller size pizzas, reports Angela Marchand, brand manager for Bonici brand pizza. “Casual dining, in particular, is buying 5-ounce dough balls or small sheeted rounds to make personal pizzas.”
Pre-proofed sheeted doughs with rolled edges. Since the proofing is done in the plant, these doughs can go directly from freezer to oven. They are available in all size rounds and oblongs, says Jeremy Kurth, category manager for pizza at Schwan’s Food Service, and the dough can be slacked out to make calzones, stromboli and breadsticks. “Sheeted doughs with a rolled edge that rises as it bakes are the choice of operators who want a handcrafted look,” he adds.
Multigrain crusts. Under its Frescetta label, Schwan’s launched a pizza crust boasting nine grains and a rolled edge in three size rounds: 7-, 12- and 16-inch. The crust comes topped with a creamy garlic sauce and mozzarella; operators can add artichokes, chicken or other compatible toppings to customize it.
Meaty toppings. Thicker pepperoni slices, larger sausage chunks and crumbles and meatballs are in greater demand, says Marchand. “Operators are also looking for meats with an ethnic twist, like chorizo, and toppings that can have multiple uses across the menu, such as roasted chicken breast strips.”
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