PIZZA PROFIT


By Meline Beach

Pizza, pie or slice – call it what you will, but this popular food item remains a favourite across generations, cultures and communities. According to Technomic, a food research organization, pizza remains one of the most popular and craveable foods in the foodservice industry. Its 2018 Pizza Consumer Trend report states that 43 per cent of consumers order pizza at least once a week.

As a quick and affordable meal, pizza pleases a variety of palates around the dinner table, at birthday parties, sporting events and on-the-go. With a profit margin of 40 to 60 per cent, it’s a worthy investment that makes good business sense.

If you’re interested in starting a foodservice program or looking to bolster your existing offering, pizza is a sensible option that can attract loyal customers and increase revenue. Whether it’s made to order, fresh pre-packaged or frozen, there are a number of details to consider when deciding if a foodservice pizza program is right for you.

Space, Equipment & Costs

Space and equipment are key factors in determining not only if you should offer a pizza program, but whether or not to go with an inhouse independent program or to partner with a supplier for a turnkey, branded solution.

Cathy Bitar, co-owner of Dufferin Variety & Pizza likes having a big kitchen. Approximately 660 square feet of her 1,500 square foot store in Port Dufferin, Nova Scotia, is dedicated to her foodservice program. Bitar, and her husband Albert, have maintained the original layout since buying their store 20 years ago. They proudly make their pizzas from scratch.

While industry experts indicate that 100 square feet may be sufficient space for pizza equipment in a c-store setting, it’s important to factor in the overall layout of your foodservice preparation area, counterspace and traffic flow.

“We have a pizza oven, mixer, fryers, grill, warmer and fridges and freezers,” says Bitar.

While it depends on your store and market, pizza can be a low entry cost program. For approximately $2,500, Canadian Trade House offers a complete set up with a pizza oven, pizza warmer, a pizza pan, cutting board and cutter, as well as a POS kit and four cases of product.

 

Fresh or Frozen

If you don’t have access to a full kitchen suitable for making pizza from scratch, you can consider working with a supplier for a turnkey solution, such as Canadian Trade House, who partnered with Core-Mark for their jointly-developed Hot Stuff Express “Pizza made easy” program.

“Our Hot Stuff Express program has been developed to be user-friendly with minimal work, equipment and capital expenses,” says Rick Woods, managing partner of Canadian Trade House. “Key pieces of equipment include a countertop warmer and a countertop oven. Each program offers a different price point from the number of slices to the size of slices.”

Classic Touch Foods is in the midst of launching a premium pizza and flatbread offering to the C&G channel also through Core-Mark. Sold frozen with the option to heat at home or on location, their pizzas and shareable flatbreads feature premium ingredients.

“We aim to set ourselves apart with a premium product at an affordable price point,” says Joseph Belcastro, assistant general manager at Classic Touch Foods. “Our ingredients are fresh, without preservatives and locally sourced.”

Belcastro believes that ready-to-eat entrees sold in the C&G channel is a great growth opportunity. The Covid-19 pandemic created greater awareness and demand for c-store foodservice as many grocery chains experienced long lines and low inventory.

“It’s all in the name; people are always looking for convenience,” says Belcastro. “All the prep work is done ahead of time. We offer c-stores a premium product at a value price point that takes minutes to heat and sell versus 45 minutes for delivery from a QSR.”

The Markham, Ontario-based company already supplies fresh sandwiches, wraps and a variety of homestyle entrees through Core-Mark. Pizzas and flatbreads, with a shelf life of eight days fresh or six months frozen, are part of their evolving product offering.

Toppings, Options & Delivery

Pizza is convenient, fun and one of the most versatile food options available. C-stores can apply as much creativity as desired, from traditional to artisan.

Classic Touch Foods has seven varieties of their 700-gram (8 slices) pizza and five flavour combinations for their shareable 225-gram flatbread. Options include cheeseburger, bocconcini and basil, grilled vegetable, margherita, Sicilian (salami), and Quattro Formaggio (provolone, parmesan, mozzarella and asiago).

Creativity doesn’t end there. Breakfast and dessert create new possibilities, as does a variety of dietary preferences. However, thorough market research and proper product development would be highly recommended before adding unique food experiences.

Owned and operated by generations of the Pitocco family since 1974, Lui’s Place Pizza in Innisfil, Ontario, launched its foodservice program in 2006. Their top selling handmade pizza is the “Deluxe” (pepperoni, onion, mushrooms, and green peppers), followed by “Meat Lovers” (pepperoni, bacon, sausage & beef) and “Hawaiian” (bacon, ham pineapple).

“Our reputation was built based on good products, very reasonable prices and courteous service,” says Tony Pitocco, general manager of Lui’s Place Pizza.

Located near a school, Lui’s often caters to students, families and tourists. While the Covid-19 pandemic caused them to close their doors for a couple of months, they’ve since reopened and are back in business – although operating a little differently than before.

“At this time, we no longer sell pizza by the slice and prepare whole pizzas for take-out only by curbside pick up,” says Pitocco. “We also removed our in-store seating area and are considering delivery options.”

That’s not a bad idea, according to Frank Beard, a convenience retailing consultant from Des Moines, Iowa. “Retailers need to think beyond their physical store when it comes to foodservice. As an industry that thrives on routine, the COVID-19 pandemic disrupted the habits of many consumers, while accelerated key trends to levels that weren’t expected for years.” He adds, “In urban and suburban markets, c-stores should expect less visits as consumers work from home rather than commute to an office, embrace eCommerce solutions, and rely on the convenience of grocery and meal delivery. Savvy retailers will open new channels to their stores, like delivery and curbside pickup.”

Marketing & Cross-Promotion

Cross-promoting high-margin pizza with lower revenue generating c-store products can help balance profitability.

“We have had a few bad years and if it wasn’t for our foodservice program, we probably would not have made it,” says Bitar, who often runs a promotion for a free pop or a free McCain cake with the purchase of pizza.

“I’m always running contests and giveaways through our Facebook page,” says Bitar. “Customers who like and share our posts are automatically entered into a draw to win prizes – anywhere from free chocolate bars, pizzas to a television set we gave away for our 20th anniversary.”

Marketing and promotions help drive sales and build customer loyalty.

As a supplier partner, Canadian Trade House supports their clients’ foodservice programs with free products, point of sale materials and seasonal or customer-specific promotions.

The key is to know your market, understand your customers, and apply the basic elements of customer service, store cleanliness, and appropriate food handling and safety as the foundation to foodservice success.

Woods adds: “If you’re going to offer a hot pizza program, you need to embrace it wholeheartedly. While there may be some shrink in the beginning until your customers are aware of your products, stay the course and offer a quality pizza product every day. It will pay off in the long run when you become a destination of choice for pizza.”

Meline Beach is a Toronto-based communications practitioner and frequent contributor to Convenience & Carwash Canada. In addition to freelance writing, Meline provides communications and public relations support to businesses across Canada. She can be reached at www.mlbcomms.ca