They hail from different corners of the country and possess a multitude of backgrounds and experiences, but all have one thing in common: A big pie-in-the-sky idea.
Pizza pie, that is.
From California to Michigan and points in between, gung-ho pizza restaurant franchise founders and operators are creating their own unique brands or sticking with well-established names to turn their dreams into reality. As 2016 begins, strong pizza restaurant franchise demand, which became evident a few years ago, shows no signs of letting up.
Another point in common: Virtually all of the franchises are attempting to capitalize on increasing consumer appetite for fresh, low-cost, build-your-own pizza with multiple toppings available in mere minutes.
If recent openings of new franchise units serve as any indication, franchisors and franchisees are succeeding on a wide scale. But in addition to the seemingly insatiable hunger for new franchises, there is intense competition for a slice of the pizza market – and there’s no room for anyone with a weak stomach.
Success Comes at a Price
Franchise operators are succeeding with different pizza priorities – traditional dine-in restaurants, takeout, pick-up and/or delivery. Some outlets offer a variety of the aforementioned options, while others might only provide one or two. The fast-casual concept remains the emerging pizza franchise trend as relatively new brands continue to announce moves into new markets and restaurant openings at a fast pace.
In comparison, openings of established outlets like Domino’s, Little Caesars, and Pizza Hut do not appear to be as frequent – or generating as much buzz – and growth has been minimal. But their financial figures are still relatively stable given that the U.S. economy is still recovering from the Great Recession. However, no matter whether franchisees seek to go with a new or old brand, success comes at a price.
And, it ain’t cheap.
For instance, Little Caesars says its total initial investment ranges from $266,000 to $681,500. Also, each prospective franchise owner must have a net worth of $250,000 and a minimum of $100,000 in liquid assets – which usually refers to available cash (or assets that can be converted into cash in a short time, with little or no loss in value).
According to Entrepreneur magazine, Little Caesars does not permit absentee ownership, meaning that franchise owners should also expect to invest a considerable amount of their time – a rule that might deter their investment in other restaurants or businesses.
That means prospective franchise operators will not be able to start with a small investment like brothers Frank and Dan Carney did when they founded Pizza Hut in Wichita, Kan., in 1958 with a $600 loan from their mother. Today, according to Entrepreneur.com, a new Pizza Hut franchise costs $297,000 to $2,109,000, and owners are expected to have a net worth of $750,000 along with $350,000 in liquid assets.
But fast-casual franchisees can’t escape the high purchase costs, either. In fact, some fast-casual pizza franchises – which have much shorter track records – cost even more than the old-time brand outlets. For example, PizzaRev franchises require $509,000 to $902,500 worth of investment, according to Entrepreneur.com. Buyers must have a net worth of $500,000 and $250,000 in liquid assets available.
But would-be franchise owners are not shying away from the costs – and they are also displaying the ability to cover them without too much difficulty. According to Entrepreneur.com, all PizzaRev franchisees own more than one unit.
Emerging Franchises Boast Experienced Teams
PizzaRev, founded in 2012, has an executive team that features people with Fortune 500 company experience as well as high-profile restaurant backgrounds. Satyen Shah, the managing partner of a group which has signed a New Jersey franchise development agreement with PizzaRev, has 20 years of restaurant experience. PizzaRev has also developed a strategic investment partnership with Buffalo Wild Wings.
Several other fast-casual pizza franchise developers also have backers with big wallets and considerable business savvy. Denver-based Live Basil was launched by Smashburger founders Tom Ryan and Rick Schaden. Meanwhile, Dallas-based Pie Five Pizza originally started as an express spin-off of Pizza Inn, while Los Angeles-based 800 Degrees is a subsidiary of Umami Burger parent Umami Restaurant Group.
Another L.A.-based fast-casual franchisor, Pizza Studio is headed by former Baja Fresh and Burger King executive Ron Biskin. Another California-based brand, Project Pie, was the brainchild of founder James Markham, who previously conceived MOD Pizza and Pieology.
Blaze Pizza, which also has California roots, was launched by Wetzel’s Pretzels founders Rick and Elise Wetzel in 2012 and boasts an investor lineup that includes former California first lady Maria Shriver, basketball superstar LeBron James, Boston Red Sox chairman Tom Werner, and Panda Express founder Andrew Cherng.
“It was so clear to us that fast casual, in terms of a service system, is being adopted at an accelerating rate by many, many Americans,” Live Basil’s Ryan, who has watched Smashburger grow to more than 200 units and nearly $200 million in sales since it launched in 2007, told QSRmagazine.com. “It seems to be the right balance of service, convenience, speed, and quality, if you will, that just makes the whole fast-casual segment, regardless of the product, very popular to consumers. It fits into their lifestyle.”
Variety Spicing Up Fast-Casual Pizza Biz
Some say variety is the spice of life. In the fast-casual pizza game, it’s also the spice of the business – with or without basil, cilantro, chili peppers, or other spicy ingredients. Live Basil lives up to its name by placing a basil plant at the order counter and allowing customers to use it as an ingredient in their pizzas.
Blaze toppings include peanut butter, while Toppers outlets offer macaroni and cheese, bacon cheeseburger and taco toppings. PizzaRev serves up a vegan sausage pie. Most fast-casual franchises offer countless toppings, although some limit the number that can be put on each pizza, while at least two boast that they offer a million topping combinations.
Although these widely advertised million-topping claims are a bit misleading, customers are flocking to fast-casual outlets for the right to build their own pizzas, and it’s clear that freedom of choice matters. In many cases, pizza franchises are allowing customers to build their own pizzas or select from signature recipes.
Gone are the days when customers of a certain vintage would walk into a pizza joint fretting that the operator would not allow them to have ham and pineapple on one half and the other half with pepperoni and mushroom. Speaking of mushrooms, one of Live Basil’s best-selling signature pizzas offers truffle mushrooms, arugula, and mascarpone.
“Ten years ago, people didn’t even know what truffle was, and here we are, it’s one of our top three selling pizzas,” Live Basil’s Ryan told Quickservicerestaurant.com. “I think that just reflects the kind of flavor diversity that people are actually looking for these days.”
Much like Smashburger, Ryan told the website, Live Basil is thriving on customers’ desires for new, bold flavors in a familiar format. Meanwhile, the chance to build a pizza from scratch is appealing to the younger demographics.
“This new generation, millennials, they’re used to getting everything their way,” Pie Five Pizza Co. CEO Randy Gier told QSRmagazine.com. “It’s just a customized world they’ve grown up in; they haven’t known anything different. They’re used to directing what they want because of the technology they’ve grown up with, and having those options and choices…we think is a big win.”
Pizza Hut Puts Emphasis on Convenience
Traditional pizza franchise players have taken notice of the fast-casual sector’s emphasis on choice, with at least one – Pizza Hut – trying to respond in a big way.
As Franchise Chatter reported previously, Pizza Hut revamped its menu in 2014, claiming it offers 2 billion different ways to order pies. The move was accompanied by a multi-million-dollar advertising campaign with new options dubbed “The Flavor of Now.”
New toppings and ingredients include sliced banana peppers, Peruvian cherry peppers, fresh spinach, premium salami, classic meatballs; toasted asiago and honey sriracha crusts; and flavor drizzles, including a balsamic version that spirals from the inside center of the pizza toward the edges.
But it is evident that “The Flavor of Now” has not wowed Pizza Hut’s customers as much as the company had hoped. During a presentation in December 2015, as The Associated Press reported, Greg Creed, president and CEO of Pizza Hut’s parent Yum Brands, said the pizza firm discovered that “easy” beats “better.”
Creed suggested that Pizza Hut needed to be more like the Uber car-sharing service and put more emphasis on convenience – through such features as online ordering, faster cooking times, and quicker delivery – rather than quality. But it remains to be seen whether the strategy will work over the long term.
Technology Also Matters
Technology is also providing some big victories for pizza franchise operators as they become immersed in the online retail revolution. Just as millennials and other age groups expect to be able to acquire books, clothing and a host of other items online, they also want to buy pizza with their mobile devices or computers – and have it available for pick-up, delivery or in the restaurant.
According to Restaurant.com, 40% of Toppers orders now arrive through the company’s consumer website. Uncle Maddio’s offers online and mobile ordering as well as an enhanced cyber security feature.
“We maintain the same high standard of customer service online as we do in our restaurants,” Uncle Maddio’s founder Matt Andrew told QSRmagazine.com.
Fast-casual pizza outlets are also using technology for marketing purposes and companies have become prolific with social media, including Facebook, Twitter, and Pinterest. In recent years, Uncle Maddio’s has promoted heavily online and the firm’s social media offerings include guest VIP cards on Facebook.
“Social media makes the world a smaller place,” said Uncle Maddio’s marketing director Sherean Malekzadeh Allen in a company news release. “It has the power to turn the corner pizza joint into a nationally-recognized brand.”
Some franchisors are also using technology to help franchisees handle the heat of the business.
Toppers, which has 71 franchises and plans to expand to 700 over the next decade, uses Web-based technology, which it built from scratch, to train new franchise operators. The e-learning management system includes checklists, hands-on training, videos and tests.
Toppers has also revamped its franchise-development website, putting the focus on attracting experienced and committed multi-unit franchisees. The new features include a restaurant tour video.
Although the company falls under the radar of many franchising industry observers, it is set to open its 100th location in 2016 and was ranked #337 in Entrepreneur magazine’s Franchise 500 list for 2016.
While software is changing the ordering, marketing and franchise-development processes, new hardware is changing pizza franchises at their core – the oven.
New high-heat ovens, which produce temperatures ranging from 800 degrees to more than 1,000 degrees Fahrenheit, are enabling fast-casual franchise operators to live up to their fast label like never before. Although pizza and high-heat ovens have been around since the 1700s or 1800s, new quick-bake technology means a pizza can be ready five minutes after a customer orders it.
Accordingly, PizzaRev co-founder Irv Zuckerman, whose outlets use a Woodstone open-flamed stone hearth oven, told Quickservicerestaurant.com that the fast-casual pizza segment is accelerating because of innovative oven technology.
“Pizza is a go-to entrée, so with the advent of the very hot oven, we are now able to offer a pizza that previously took 10 or 15 minutes to make (in) just three minutes,” said Zuckerman. “This changes the paradigm, especially for lunch, by fulfilling a desire by consumers to have a high-quality offering quickly served, so that they can enjoy one of their favorite foods with minimal time commitment.”
Pie Five’s Gier, whose company uses TurboChef ovens, told Quickservicerestaurant.com that the demand for quick, customizable, personal pizzas has been around for decades, but previous solutions lacked quality.
“What has happened is the technology is enabling a quality solution to meet the customer’s needs,” he said.
Oven technology advancements have now reached the point where pizza franchise operators are debating the merits of rotating decks versus static decks.
“Currently many oven manufacturers are jumping on a bandwagon of rotating deck ovens to (seemingly) address the assembly fast casual segment, but we feel that a static oven performs best,” Blaze executive chef Brad Kent told Quickservicerestaurant.com.
Future Might Not Be Friendly
So what do these business and technological trends mean for the pizza franchise operator going forward?
First of all, it will be very hard to handle the heat in the kitchen as high, some might say extreme, competition, rules in both the fast-casual and traditional marketplaces. New and veteran operators alike must have access to ample financial resources – not an easy task as the American economy continues to recover from the Great Recession.
In addition to basic business knowledge, franchise operators will also need to have a broad understanding of technologies that affect their customers and their own operations – or at least have ready access to people who do understand these factors. The marketplace dynamics, which appear to be changing rapidly and place an onus on providing personal pizza at a relatively low price, also mean that franchise operators must have a firm understanding – and control – of their profit margins and costs.
The bottom line?
Literally and figuratively, pizza franchise operators must put their fingers in a lot of pies.
Pizza Hut Still a Powerhouse
Every budding franchise operator dreams of the success that brothers Dan and Frank Carney had with Pizza Hut after launching the brand’s first restaurant in their hometown of Wichita, Kan. Using a $600 loan from their mother, they opened the restaurant in 1958 at the request of a landlord who was seeking a tenant in an unrented building.
The Carney brothers opened their first franchise in Topeka the following year and launched in the Kansas locales of Aggieville – where the first Pizza Hut buffet was conceived and the first pizzas were delivered on a three-wheeled scooter – and Manhattan. The franchisor became a global powerhouse before the Carneys sold their interest to PepsiCo in 1977 and now ranks as the world’s largest pizza franchise restaurant chain.
Today, Pizza Hut is operated by Yum Brands, which also controls KFC and Taco Bell franchises. While the latter two are thriving, Pizza Hut has struggled. Yum’s third-quarter 2015 financial results show that the Pizza Hut division’s system sales increased by just 2% (versus 6% for KFC and 7% for Taco Bell), driven by 2% unit growth and 1% same-store sales growth. Operating margin decreased 0.7 percentage points to 25.4%, while operating profit was even.
After a disappointing first-quarter 2015, when the operating profit fell 2% to $81 million, Yum CEO Greg Creed acknowledged that there is still more work to do with Pizza Hut despite efforts to increase customer choice.
“As you know, we recently launched a new pizza platform in the U.S., where over half of the division’s profits are generated,” said Creed in a conference call with analysts in April. “This new platform has given our customers unparalleled variety with exciting new toppings, crusts and flavors. Unfortunately, we haven’t been as effective as we would like with our marketing and need to balance its appeal to millennials with mainstream pizza customers.”
But Pizza Hut’s struggles can likely be attributed in part to the effects of the Great Recession and the U.S. economy’s slow recovery. An improving economy and increasing online sales could boost Pizza Hut’s fortunes in the near future, and its revenues are still huge despite the drop in profit.
In other words, it’s still a powerhouse.
Name Reflects Delivery Chain’s Dominance in Market
Domino’s began its journey to franchise superstardom in 1960 as Tom Monaghan and his brother James purchased DomiNick’s, a small pizza outlet in Ypsilanti, Mich., with a $500 down payment and $900 in borrowed money. As the story goes, James, a postal carrier, did not want to quit his day job and soon traded his half of the business for the Volkswagen Beetle that the brothers used to deliver pizzas.
Within three years, Tom Monaghan purchased two more pizzerias in the same county, but the original owner balked at the use of the name DomiNick’s. At the suggestion of an employee, Tom Monaghan changed the name to Domino’s Pizza. The company opened its first franchise location in 1967 and expanded to 200 stores by 1978.
Today, Domino’s, which went public in 2004, is the world’s second-largest pizza franchise restaurant chain with 12,100 outlets in 80-plus countries. The business grew from its focus on quick pizza delivery, but Domino’s also generates considerable business through carry-out pizza sales while also peddling other products.
Domino’s has also adapted well to technological changes, particularly in the area of online ordering while still allowing customers to craft pies as they like them. The company prides itself on serving local neighborhoods through its large network of franchised and company-owned operations.
The model is working, given that Domino’s sells 1.5 million pizzas per day on average and has produced strong financials despite difficult economic times. Domino’s posted $130 million in net income in the first three quarters of 2015, exceeding the $114.60 million in net income in the first three quarters of 2014.
Zacks Research has given Domino’s a positive growth score, and based on a poll of analysts, predicts that the firm will have long-term growth of about 16% based on sales and earnings over the next three to five years. These numbers are positive for potential franchisees, but buyers may be challenged by high franchise costs and individual-wealth requirements.
Teen’s Idea Becomes Franchise Success Story
As the legend goes, the idea for Papa John’s was born in the 1970s while franchise founder and namesake John Schnatter was 15 years old and washing dishes in a pizza joint called Rocky’s in his hometown of Jeffersonville, Ind. In addition to learning how to cook pizzas without having uneaten parts of the pies returned with dirty dishes, he noticed that national chains delivered their pizzas, but local pizzerias did not.
After graduating from Ball State, he came home and helped get his dad’s struggling tavern back on an even keel by selling his prized 1972 Camaro. In 1984, Schnatter purchased $1,600 worth of equipment, knocked out a wall in the back of the tavern and launched Papa John’s.
Today, Papa John’s has more than 4,500 outlets – with 700 belonging to the company and 3,800 owned by franchisees. It helps that Frank Carney, one of the co-founders of Pizza Hut became a franchisee, owning more than 130 units at one point, and Schnatter leans on him for advice.
Currently, sales exceed $1 billion annually and the franchisor posts decent profits despite a slower-than-expected economic recovery. Although financial results show that most new Papa John’s restaurants opened outside the U.S. in the first three quarters of 2015, the company’s net income was $51.0 million for the first nine months of 2015, compared to $52.1 million for the same period in 2014.
Ilitches Still Know How to Bring Customers In
Mike Ilitch is a name well known to virtually anyone interested, or involved, in hockey or baseball. He is the longtime owner of both the Detroit Red Wings and Detroit Tigers. But before getting involved with those clubs, Ilitch, a former minor-league baseball player, made his fortune in pizza.
He and his wife Marian opened the first Little Caesars in a Detroit suburb in 1959 with $10,000 in life savings and grew it into the largest carry-out pizza chain in the world. They were way ahead of their time in introducing small-format franchised pizza joints that are becoming increasingly common as operators strive to cater to millennials, reduce their real estate footprints and strive to find new ways to attract fickle customers.
Little Caesars bills itself as the first chain to offer two-for-one pizza deals, breadsticks that became a staple, and restaurants in unexpected places like sports arenas, college dorms and military bases. The Ilitches were also among the first to sell deep-pan pizza and they introduced some of the earliest high-heat and high-speed technology, particularly a conveyor oven that had pies ready as customers came in the door.
Little Caesars is also known for its tiny Caesar logo, trademarked catch phrase “Pizza! Pizza!” and low-priced pies. Late in 2015, the chain expanded into the Connecticut locales of Bridgeport, Danbury and Stratford and was also looking to grow in New York and New Jersey, including affluent and highly stable Fairfield and Westchester counties.
Some newcomers in the pizza franchising game, particularly fast-casual promoters, might consider Little Caesars among the brands and formats that are old and need revamping. But new franchisors should not be overconfident, because the Ilitches still know how to bring in customers – and revenues – for their franchisees.
Chain Differs From Other Pizza Franchises
Papa Murphy’s differs from many other pizza franchises in that it sells take-and-bake, or uncooked, pies made with fresh ingredients. Customers instruct personnel to make pizzas just as they would create a sandwich at a Subway shop.
The franchisor’s roots date to 1981, when the Papa Aldo’s chain was born in Hillsboro, Ore. Papa Aldo’s Pizza later merged with Murphy’s Pizza to create the Papa Murphy’s brand in 1995. Currently, Papa Murphy’s, which has approximately 1,500 stores, claims it is the largest take-and-bake pizza company in the world and the fifth-largest pizza chain in the U.S.
The company reported that it opened 23 new outlets in the third quarter of 2015, up from 13 in the same period in 2014. Meanwhile, third-quarter 2015 revenues jumped 26.9% to $28.1 million from $22.2 million in third-quarter 2014. But net income was a modest $1.12 million, compared to pro forma net income of $1.32 million in the third quarter of 2014.
The company, which went public in 2014, has delivered 19 consecutive quarters of comparable store sales growth, but its financial results have not impressed all franchisees or analysts. Papa Murphy’s has been dogged by a lawsuit in which some franchisees in various parts of the U.S., including Washington state and the South, claim that franchises were not likely to be as successful as the company claimed.
Franchisees with beefs include husbands, wives and young entrepreneurs, who invested their life savings but did not get the returns they expected. They also contend that the company misled them about how much money they needed to run their operations. Some analysts have expressed a desire for stronger returns, but many reviews are also positive.
Franchisor Revving Up Business Through Choice, Aggressive Expansion
As its name suggests, PizzaRev wants to revolutionize the pizza franchise business by emphasizing choice, or a “food-forward” approach within the fast-casual sector. Meanwhile, the company – founded in 2012 in Los Angeles – is revving up its business through aggressive expansion.
PizzaRev opened a new location in Glendale, Calif., on Dec. 17 and now says it has about 150 outlets in various stages of development across the U.S. and Mexico, where it will open its first franchise outlet in the first quarter of 2016. The firm has 21 corporate and franchise locations in California, Colorado, South Dakota and Utah. It has also signed a New Jersey franchise development agreement with established restaurant owners Satyen Shah, Mohammed Amar Chaudhry and Harmeet Singh.
The trio has voiced plans to set up shop in Wayne, Clifton, Seacaucus, Jersey City and Bergen County. PizzaRev has also signed a multi-unit agreement with Fire Em Up group to develop the brand across Arizona. In addition, PizzaRev plans to open its first international location in Monterrey, Mexico.
In December 2015, PizzaRev announced that it signed its second franchise development agreement in Mexico. Under the terms of the deal, Antonio Perez Lete and Jose Antonio Perez Lete will develop 20 PizzaRev locations across the states of Nayarit, Colima, Jalisco and Aguascalientes. The group currently owns and operates 10 Carl’s Jr. restaurants throughout the Guadalajara region.
The deal follows up on an August 2015 agreement that will see Grupo Galería, the largest Carl’s Jr. franchisee in Mexico, bring 20 locations to Mexico City and the states of Mexico, Nuevo León and Coahuila. The first PizzaRev location in Mexico is scheduled to open in Monterrey, N.L. in Q1 2016.
In the process of expanding, PizzaRev has picked up some nice accolades, which include being listed on CNBC’s list of top 10 brands to watch and a No. 16 listing in the Fast Casual Top 100 Movers and Shakers.
Blazing a New Pizza Franchise Path
Blaze Pizza became a hot fast-casual pizza franchise story after Rick and Elise Wetzel, founders of Wetzel’s Pretzels, did a slow burn. One day in mid-2011, the Wetzels wanted to have make-your-own pizza for lunch, but they could not find a fast-casual pie joint in their hometown of Pasadena and settled for Chipotle instead.
So the Wetzels decided to open their own fast-casual pizza restaurant in 2012. “It was sort of this ‘ah ha’ moment when we looked at it: ‘Why can’t we do this to pizza, do what Chipotle did to the burrito or Mexican food?’” Rick Wetzel told QSR Magazine in 2013. “That was sort of the spark that went off.”
As QSR noted, the spark became a Blaze, and in December 2015 the company opened its 100th location, in Indianapolis. Applying “the Chipotle model” to its ordering process, Blaze allows customers to select from among seven meats, 15 vegetables, seven cheeses, and six sauces to build their own customized “artisan” pies, which bake for about two and a half minutes in a high-tech oven and sell at around $8.
While the Wetzels provide considerable franchising expertise, they also draw from the knowledge of executive chef Bradford Kent, one of the most highly acclaimed pizza chefs in the country, and the bank accounts of such notable investors as former California first lady Maria Shriver, basketball superstar LeBron James, Boston Red Sox chairman Tom Werner, and Panda Express founder Andrew Cherng, among others.
“Those guys have lots of help, lots of connections,” Rick Wetzel told QSR. “They also have helped put a spotlight on the brand, so I kind of can use them like endorsement deals without having endorsements. We’ve done this before; I’ve done Wetzel’s, and some of these investors are with Wetzel’s as well, so we assembled (Blaze) and were able to go out and put together a top-notch headquarter team.”
Pieology Founder Aims to Fix Pizza Business
Pieology founder and CEO Carl Chang told Business Insider that the company started when he identified a problem in the pizza industry. “Pizza for us was somewhat broken,” said Chang. “Pizza used to be a celebration when you were with family and friends. Now, it somewhat has become a bit more [of a] convenience food or a coupon food, if you will.”
Chang also borrows from the Chipotle model, and has strived to make each Pieology restaurant a “celebration of food” and source of inspiration. Each restaurant displays inspirational quotes, makes its own dough, offers 40 toppings and sells custom pizza for $8 or less.
Chang uses several different vendors and encourages the use of produce supplied by local sources. In a move that might enhance culinary tourism, Chang also caters to local demographics by adjusting the menu for each location.
This local approach has resulted in widespread expansion. According to Technomic, Pieology is the fastest-growing chain in America.
Chang is the brother and former coach of tennis professional Michael Chang, who along with his wife Amber has bought two Pieology franchises in California.
“My wife and I are proud to be members of the Pieology family during this very exciting time of growth and innovation, and we’re looking forward to bringing the customized dining experience to our new guests in La Mirada,” said Michael Chang in a news release that announced the couple’s second franchise opening in June 2015. “I’ve been a believer in my brother’s vision for Pieology since day one and I’m thrilled to see that the concept is exceeding expectations in all areas, from sales to guest satisfaction. These first two locations are only the beginning of my franchise plans with Pieology!”
The franchisor opened its first Missouri location, in Charles, in November 2015 and others will open in Guam, Saipan and Charlotte by mid-year 2016. According to the news release on Michael Chang’s second pizzeria opening, Pieology had commitments for 500 franchises in total and was on schedule to open 110 by year-end 2015.
MOD-ern Pizza Pioneer Continues to Grow
While some successful fast-casual pizza franchise businesses are upstarts, MOD – an acronym for Made on Demand – is an established player.
The business started in 2008 in the Pacific Northwest, a region known more for coffee shop chains – specifically Starbucks and Seattle Coffee Co. Perhaps fittingly, Seattle Coffee founders Ally and Scott Svenson also happen to be among MOD’s founders, along with early backer James Markham, who left MOD in 2010 and has since launched lesser known Project Pie.
In keeping with the fast-casual pizza game’s use of high-powered personnel, MOD beefed up its executive team with former employees of Starbucks, JP Morgan Chase and the Walt Disney Company.
But MOD’s oldtimer status is not deterring its expansion plans. December 2015 alone proved to be a busy month as the company opened new locations and shed light on some of its future plans. Among the highlights: MOD opened its fifth Metro Detroit location and launched a new restaurant in Mission Grove, Calif.
Meanwhile, MOD hired former Nando’s executive John Nelson as its CEO of operations in the U.K., which is intended to be the company’s first international market. According to media reports, MOD also signed a franchise development deal with Indiana-based Womach Restaurants. Womach plans to open MOD locations in the Kansas City marketplace, other locations in Kansas and Columbus, Ohio.
MOD is also slated to open a second location in Pennsylvania’s Lehigh Valley (in Bethlehem Township) and two new locations in the state’s York County region.
Despite the franchisor’s emphasis on growth, which can challenge operations, it still looked after employees at its outlets. Fortune ranked MOD seventh on its “20 Best Workplaces in Retail” list in 2015. The magazine praised MOD for its Bridge fund, which provides money for employees dealing with difficult circumstances, as well as the firm’s benefit program for workers toiling more than 26 weeks per year.
“Our ranking as a top workplace is particularly gratifying because we believe a workplace is really nothing more than the people who occupy it,” said Scott Svenson in a news release. “Our product may be pizza, but our purpose is people.”
Buffet Operator Not Just About Pizza Anymore
Cicis restaurants offer an all-you-can-eat buffet that includes deep-pan as well as round pizza, pasta, wings, salads and dessert. Restaurant personnel will also make custom pizzas upon request.
The firm is well-established, with approximately 450 locations across the U.S., after launching in Plano, Tex., in 1985. But it has acknowledged a need to refresh its image. The restaurants now have a new brand – Cicis without the former apostrophe. And, in keeping with its diverse food offerings, Cicis does not want to be only about pizza anymore, so “Beyond Pizza” has been added to the branding.
The franchisor has spent much of the past two years evaluating its concept and developing a revitalization strategy. “For us, it was more than just a name change – it was making our logo current,” company CEO Darin Harris told Nation’s Restaurant News in June 2015. “We want our guests to know we’re more than pizza, because we have pizza, soup, salad, pasta and a game room. At Cicis, you can order something here and customize it the way you want it. We’re about the experience you create for yourself.”
The name change is part of an overall effort by the franchisor to bring franchisees in line with “a strategic plan to drive future performance,” according to Harris. Planned improvements include revisions to the interiors of Cicis restaurants.
In December 2015, Cicis reopened its outlet in Killeen, Tex., following a renovation that resulted in an updated interior design, new kitchen equipment, granite countertops, upgraded tables and seating, lifestyle wall graphics and an expanded game room. The Cicis location in Frisco, Tex., was the first restaurant to be overhauled in such fashion, in June 2015, and also features a smaller footprint – 2,550 square feet instead of more than 4,000.
“It’s all about modernizing the brand and giving it a vision for the next 10 years versus a history of doing things the same way,” Harris told the Dallas Business Journal. “Listening to our guests, they told us they want Cicis to be more modern and they wanted an improved menu, so that’s what we worked on.”