While quick-service restaurants have been struggling with flat or slumping pizza sales over the past few years, convenience stores have been experiencing double-digit growth in the segment.
By Marilyn Odesser-Torpey, Associate Editor
Based on a premise that more options would lead to more sales, Pizza Hut has amped up its menu to give consumers twice as many pie construction choices, particularly focusing on outer crust embellishments that range from pretzel or bacon-and-cheese-stuffed to curry- or ginger-spiced.
But, the endless amount of choices hasn’t significantly spurred sales, leading the pizza giant to continue to ponder what consumers really want.
Meanwhile, for the year ending mid-February 2015, convenience stores sold 167 million servings of pizza, up 20% over the year before, said Bonnie Riggs, restaurant industry analyst for the NPD Group global information firm. That percentage increase comes on the heels of strong sales in 2013 and 2014.
“Driving this growth are the food-forward chains, the ones that are really focusing on offering high-quality foodservice,” Riggs said. “Some of them are doing an exceptionally good job with food products—pizza being one of them.”
Good pricing, quick service in and out, strong customer loyalty and effective loyalty programs also give convenience stores a significant edge over other outlets, she said. According to NPD’s Supply Track, a monthly service that tracks every product shipped from broadline foodservice distributors to convenience stores, cases of pizza crust and dough shipped to convenience stores increased by 27% over a year ago. Total dollars of pizza crust and dough cases rose by over 30%.
PROPRIETARY PIZZA
At Stop ‘n Go Convenience Stores, pizza is one of the cornerstones of the foodservice program, said Craig Stanley, foodservice category manager for the Medina, Ohio-based chain. He noted that every year since pizza was introduced in the mid-1990s, sales have grown. The proprietary program is the top category for foodservice in the stores.
Stop ‘n Go offers seven-inch personal pizzas in five of its 10 stores in northeastern Ohio. The pies are assembled on site and are available for grab and go from a two-foot-long warm-hold box. Customers can also phone in orders in advance for pick-up. Stanley noted that the goal is to add other technology-based options, such as online ordering.
The menu features six core pies and specialties that include buffalo chicken and steak and cheese. Limited time offers (LTOs) are used to test new pizza varieties to determine if they generate enough sales to quality them for addition to the permanent menu, Stanley said. Buffalo chicken, made with ranch dressing and Frank’s Red-hot Sauce, for example, began as an LTO.
For spring, the stores are testing a sriracha southwest sausage pizza with jalapeño peppers and queso in place of marinara sauce. Summer, the stores’ busiest season, is peak time for introducing LTOs.
For the first 28 days of an LTO’s life on the menu, the item’s introduction is supported with a great deal of promotion from window, pump topper and point-of-sale signage. After that, it remains on the menu for an additional 60 days to see if the offering continues to sell well on its own.
With an impinger oven it takes, at most, six minutes to cook a pizza at the Stop ‘n Go stores. Although lunch is still prime pizza sales time, Stanley explained that dinner business is constantly increasing and between-meal snack sales are growing.
Pizza prices at Stop ‘n Go range from $3.29 for pepperoni to $4.29 for buffalo chicken or steak and cheese. To encourage the sale of multiple pies, the stores offer a “4-Pack Family Special” featuring four one-topping pizzas for $10.99. The four-packs sell particularly well during football tailgating season, he said.
Stop ‘n Go also bundles its pizzas with other products for even greater value. Last year, the company offered a special price for any pizza and a fountain soda. This year, the offer is a free beverage with a pepperoni pizza.
Prior to developing its own proprietary pizza program, Stop ‘n Go tried partnering with a number of branded outfits, but stuck to its own recipe in the end.
“Our company has been family owned for 50 years and we don’t want anything about our stores to be cookie cutter,” Stanley said.
SEAMLESS EXECUTION
By the slice or a personal-size whole, made-on-site pizza is also an integral part of the foodservice program at Tulsa, Okla.-based QuikTrip Convenience Stores.
Over the past year-and-a-half, the chain has been renovating many existing locations in order to include full-service kitchens. Now about 95% of the chain’s 717 stores have pizza on their menus.
“We’ve been working on this program for 10 years and now we’re confident that we have everything in place—the right product, the right equipment and the right people—so we can execute it right every time,” said Mike Thornbrugh, QuikTrip’s vice president of marketing.
Over the years, the company had tried various pizza program iterations, including full-size pies prepared at its proprietary QT Kitchens commissary for take and bake. But it’s only since the implementation of the current program that pizza sales have experienced “phenomenal growth,” Thornbrugh said.
It takes about four minutes to cook a whole pizza. One variety that has given the menu a new twist and a big boost is the breakfast pizza.
Just rolled out over the past four months after a year in development and testing, the egg, bacon, sausage and cheese pizza, which is available by the grab-and-go slice or as a personal size pie, is doing “fantastic,” Thornbrugh said. And, he noted, it hasn’t cannibalized the menus’ other morning offerings, such as breakfast sandwiches.
“The only pitfall we have encountered is that many times we have to struggle to have enough product out there to keep up with demand—it’s that popular,” Thornbrugh said.
CUSTOMIZATON SELLS
At York, Pa.-based Rutter’s Farm Stores, easy-to-eat-on-the-go stromboli are the star attraction on the sauce-and-dough segment of the menu, but the traditional proprietary pizza still has enough of a following to warrant keeping the nine-inch pie a part of the company’s made-to-order foodservice program, said Jerry Weiner, Rutter’s vice president of foodservice. The pies are topped and baked fresh to order in about three-and-a-half minutes in the turbo oven. They are also available refrigerated or frozen for take and bake.
Rutter’s originally entered the pizza realm by selling slices, then 6.5-inch personal pies. But the nine-inch pizza proved to be the most popular.
At Rutter’s, there is no additional charge for veggie toppings, such as onions; mushrooms; olives and green, sweet or jalapeño peppers. Weiner explained that over the past few years, he’s noticed an increase in the number of consumers who want to customize their pizzas.
“The easiest way to give consumers the variety they want is with different sauces and toppings,” Weiner said. “You can have one crust and change the offering 700 ways.”
Premium and innovative toppings are piquing consumer interest in and purchase of pizza on restaurant and convenience store menus, said Jana Mann, senior director of Menu Trends at Datassential research firm. Thirty percent of convenience store chains have introduced new pizza varieties or limited time offers over the past 12 months.