Anatomy of a 24-hour pizza restaurant

Sept. 23, 2010

In a world of 24-hour Taco Bells and their "Fourthmeals," an always-open pizzeria seems almost obligatory. But there are precious few of them, and no large chains to speak of that make this model their mission.

The reason? Continual operations pose problems of manpower, expensive energy usage, and the resultant losing end-of-costs-versus-profits sums.

But if Taco Bell and other fast food chains can do it, why not pizza? That’s what Tristan Koehler is setting to find out. For a month, one of his Domino’s stores has been in continual operation, and will be for almost another year.

Granted, Koehler, a franchisee of 19 Domino’s stores across Ohio, is in a very specific position to make this model work. The experimental store is in the backyard of University of Dayton in Ohio. The location has a built-in late-night crowd of college-aged patrons, and whether from studying or partying, they’re often hungry during nontraditional eating hours. And the problems of serving them profitably so far seem to have fallen off like the toppings of an overloaded pizza. 

The opportunity

Even before the 24-hour operation started a month ago, the store was busy after midnight, Koehler said. “When we closed at 3 a.m., it was still busy; 4 a.m., still busy. So we thought, if we’re going to close at 5 a.m. and open at 10 a.m., that’s only five hours. We brought in a breakfast pizza to help fill that gap.”

That’s not all he had to bring in to accommodate those extra hours. He’d need more people for the push, and for some to rearrange hours. Here again, Koehler was already halfway there with a pool of employees to choose from from his 19 units. He brought some of them in and rearranged his managers’ hours. To his surprise, they were fine with working four 12-hour shifts instead of a five-day workweek. He also hired more people right after July 4 – but said that’s nothing outside his normal schedule.

People haven’t been a problem, Koehler said; however, ovens are a different story.

“I thought we’d have a harder time with the people, but I think the maintenance will be a harder nut to crack,” he said. “Since you never close, at least one oven has to run all the time.”

It’s not the extra energy expenditures he’ll be making for the constantly run ovens that concerns him – “6 a.m. to 9 a.m. is our slow time, we’re not at a peak capacity anyway,” he said – but the prospect of having to repair a down machine during continual operation. 

Breakfast pizzas

What’s the point of all the toil and strife of adding another daypart? The chance to raise incremental sales, of course.

For that, Koehler needed to bridge the wee morning-hours gap – something he did with breakfast pizza. He came up with his own in-house recipe, but when he consulted with the area franchise leader, they’d already tested a similar one for their airport locations, where breakfast is a given.

“It’s really like a quiche,” Koehler said. They have a cheese and egg base with pizza toppings, and include a spicy Southwestern flavored option, or the ‘Get Going,’ with ham and bacon. The latter sells particularly well. 

Koehler said they’ve sampled hundreds of the slices in-store and have given away almost 2,000 gift certificates on campus to promote product trial. A lot of those got redeemed for breakfast pizzas, he said.

There are other promising trends: sales of the breakfast pizzas have steadily increased since their introduction about a month ago, though they’re not outselling the pepperoni.

“We have people who will order breakfast pizza, orange juice and coffee every day,” Koehler said. The local touch helps; the pizzeria sells local roasted coffee from Boston Stoker.

Corporate reaction

Though franchisors don’t traditionally take kindly to wild divergences from established protocol, Domino’s executives appear to be intrigued by this experiment.

“This is indeed the first (store) that has committed to this on an ongoing basis,” said company spokesperson Chris Brandon. “We’re really excited about this.”

Still, Brandon said the 24-hour move is not on the company’s radar to roll out nationally. But vice president of communications Tim McIntyre wouldn’t say “never.”

“Franchisees - especially those in college towns - are going to be paying close attention,” he said. “There are no real plans just yet, and nothing on a national scale. We'll see what works, what doesn't and where this kind of approach might fit best.”

Some stores in the UK have also been experimenting with extended hours, he added.

The Dayton-area 24-hour Domino’s will stay in continual operation until May 2011, when many students leave for homes beyond their university. Then, Koehler said, they’ll re-evaluate the strategy.

“But we’re picking up more residential business as we go,” he said.

Topics: Customer Service / Experience , Hiring and Retention , Operations Management , Staffing & Training

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