By Maureen Azzato
Americans are crazy for pizza, so much so that they consume 100 acres of pizza each day, which translates into about 350 slices per second, according to the National Association of Pizza Operators.
Pizza accounts for more than 10 percent of all foodservice sales, according to Food Industry News, so it’s no wonder many convenience store operators are trying their hand at all forms of the cheesy Italian pies, offering slices, individual pan pizzas, bake and take and, most recently, uncooked take-and-bake pizza.
While the pizza business is appealing because so many people like the product, the business is extremely competitive and it’s difficult for convenience operators to build credibility and volume.
“There’s so much competition, and it’s all about discounting,” said Paul Servais, foodservice zone leader for La Crosse, Wisconsin-based Kwik Trip. “We’ve found that the customer goes with who has the best price on the street that day. Unless you are a high-end pizza joint, you don’t see any customer loyalty.”
So, for pizza to make it in a convenience store, it helps to offer it in a variety of styles and forms. And it’s critical to show customers you are fully in the pizza business, by merchandising slices and pies and menu offerings in plain view to tantalize all the senses.
Over the past few years, some convenience operators with already-established pizza programs have expanded the category to include take and bake. “We’ve always struggled with the evening daypart and we haven’t figured it out yet,” said Curtis Watson, executive director of foodservice for Salt Lake City-based Maverik Stores Inc. “Pizza gives us the ability to hit the evening daypart, and it’s fairly easy to handle and cook.”
The 207-store chain already offered individual pan pizza, pizza by the slice and cooked whole pies, so adding take and bake made sense since it required no additional labor, equipment or ingredients, Watson said. “We’ve been selling take-and-bake pizza for a year and I would say that we’ve had lukewarm results so far, but I think it has more potential.”
Building the take-and-bake business, though, takes patience and time as well as savvy marketing and pricing strategies. Key take-and-bake competitors include Papa Murphy’s in the Midwest (which exclusively sells take-and-bake pizza), Walmart, Costco and a smattering of small regional players.
“Walmart has a pretty good program and it’s one reason we went to the 8/6/6 pricing [the first pie for $8.00 and subsequent pies for $6.00],” Watson said.
Maverik offers the same price for whole pies sold raw or cooked, as does Kwik Trip. Both chains deliver take-and-bake pizzas to their stores fully prepped and packaged. Maverik uses a customized Hot Stuff pizza product with its own signature sauce sold under the proprietary Bonfire label. Kwik Trip’s take-and-bake pizzas are pre-made at the company’s central commissary.
Many of Kwik Trip’s stores compete head-to-head with Papa Murphy’s. “They make the pizza fresh right in front of you...they’re very good at it,” Servais said. Despite the daunting competition, Kwik Trip forged ahead and steadily
grew its volume for three years. The chain currently sells 70 take-and-bake pies on average per week, per store.
Kwik Trip’s thin-crust pizza retails for $5.99, while a plain regular pie sells for $9.99 and a specialty pizza (such as a four-meat supreme) sells for $10.99. Gross margins on all pizza products average 50 percent.
“By far, pizza is the number-one gross margin item in our hot foods program,” Servais said. “The profit potential is there and labor costs, at least for us, are minimal. However, you’ve got to be patient. You’re not going to sell 70 pizzas a week in your first month. It takes time to steal customers away from every other player that makes pizza.”
Kwik Trip installed upright coolers in each store to merchandise take-andbake pizzas right by the front door. “The product does particularly well in rural areas where there is less choice and competition, but it seems to appeal to people in a hurry,” Servais said. “They’re buying it because they need a quick supper.”
Kwik Trip’s product has a three-day shelf life so, if unsold, the pizza eventually gets cooked and sold as slices. Maverik curtails waste in a similar manner, though its take-and-bake pizza has a 24-hour shelf life, which is why some stores with lower volume offer the pizza frozen. “We basically have three opportunities to sell the product to eliminate waste — frozen, fresh in the cooler or cooked for slices,” Watson said.
Beth Miller, owner of Classic Corner in Madison, South Dakota, a community of 6,000, understands some of the advantages of operating on the outskirts of small town America. With only two chain pizza restaurants nearby, there is little competition for her Hot Stuff pizza, which two years ago added a take-and-bake program.
Marketing with the slogan, “Anytime is Pizza Time,” the store sells between 20 and 25 take-and-bake pizzas per week with margins that run about 55 percent. The store even gets demand for take-and-bake breakfast pizza.
Classic Corner was one of the first Hot Stuff franchisees to offer the take-and-bake product when it was introduced in 2008. Now, more than 200 of Hot Stuff’s 1,100 convenience store franchises carry the program. “We knew it would be all incremental business for our operators,” said Craig Van Hyfte, vice president of marketing for Hot Stuff.
Hot Stuff operators thaw and proof the dough, assemble the pizzas, wrap them in plastic and box them to go. “Most of our franchisees make all their take-and-bake pizzas to order, but some do make them in advance and merchandise them in coolers,” Van Hyfte said. “Since we don’t sell pizza by the slice, we recommend operators cook unsold pizzas for sampling.”
Classic Corner makes all its take-and-bake pizzas to order, with many customers calling ahead to place orders. “The challenge for us is keeping the volume up during the warm summer months when few people want to turn on their ovens,” said Kim Rumbolz, kitchen manager.
To stimulate sales last summer, the store demonstrated how to cook take-and-bake pizzas on an outdoor grill, and gave away a barbecue grill as a door prize. “It has caught on pretty well and we will probably do something similar this year to remind people that take-and-bake pizza can be a summer food too.”
Classic Corner offers thin crust and regular crust take-and-bake pizza for $7.99 and $13.99, respectively. Every now and again the store runs promotions, but “we don’t do price promotions very often because we don’t really have to since there is little competition here,” Rumbolz said.
Clearly take-and-bake pizza in not for operators looking for quick and easy sales and profits. But for those already in the pizza business and looking to expand the category, take and bake can attract new customers and yield low-cost incremental sales.
Maureen Azzato is a freelance content developer and editor with 20 years of business publishing experience. Most recently she was the publisher and editorial director of On-the-Go Foodservice, a publication for cross-channel retail foodservice executives.