Boston's The Gourmet Pizza: ripe for growth

April 11, 2007 | by Valerie Killifer
When Doug MacDonald took the helm in 1998 as director of purchasing for Richmond, British Columbia-based Boston Pizza International, the company was just beginning its foray into the American market.
Nearly nine years and 50 U.S.-based locations later, MacDonald is at the helm of BPI's sister operation, Boston's The Gourmet Pizza.
Because MacDonald's start at BPI coincided with Boston's Gourmet United States launch, MacDonald said he has maintained an interest in the U.S. market. But the path from purchasing to president took a few turns.
After a stint as the company's purchasing director, MacDonald was promoted to executive vice president – Western Canada for BPI, which shifted his focus from the U.S. market to that closer to home. But BPI also was continuing with its push into the United States, while expanding in eastern Canada as well.
MacDonald said his intention wasn't to end up as president, rather to enjoy the work he was doing. "That's what leads to advancement," he said.
But how does a franchise, with a 98 percent brand-awareness rate in Canada, make an impact in America?
"I came down because I really believe that our concept is right for the U.S. market," said MacDonald, who now lives in Dallas with his wife and two children. "We have a nice niche. And the atmosphere is a little different because we have a sports bar and a dining room."
The sports bar/dining-room combination seems to be working, as Boston's Gourmet continues to expand its concept throughout the U.S. The company's 50th location is set to open in May, and 20 more locations are expected to open by the end of the year.
A menu makeover
One aspect of Boston's Gourmet MacDonald wanted to change: the menu. In April, Boston's Gourmet introduced 18 new signature-menu items. New menu items include: Baked Cheese Ravioli; The Flying Buffalo Pizza; Classic Shrimp Parmesan; Garlic Shrimp Al Forno; and a Bacon Cheeseburger.
The idea, says MacDonald, was to streamline the menu and gain a sense of focus.
An inside look at Boston's The Gourmet Pizza
"One of the big things was to stop trying to be everything and really focus on the things we do well," he said. "Have less items, but better items."
The idea, also, was to help franchisees become more successful.
"If you're in the franchise business, it's pretty simple: Put systems in place that allow your franchisees success. Not just with growth, but with revenue as well," MacDonald said. "The more we grow, the more franchisees are profitable."
Growth is not so much a concern for Boston Pizza. In 2006, the Canadian arm served more than 30 million guests at over 260 locations. Additionally, they have donated more than $2 million to the Heart and Stroke Foundation of Canada.  
MacDonald said company-wide giving is part of Boston's Gourmet's local-marketing plan to support schools and charities in regional locales.
"It's a big part of our culture," he said. "It has been in Canada for many years and in the U.S. we're doing exactly the same thing, but on a smaller scale."
The pizza biz
With fast-casual chains like zpizza, Red Brick Pizza and The Loop Pizza Grill eating up a large portion of the fast-casual market share, is there enough room for everyone in the pizza business?
According to Technomic Information Services Top 100 Quick Casual Report, pizza sales as a whole grew 4.4 percent in 2005. Sales growth for the Top 500 chains grew only 3.5 percent for an industry total sales growth of 3.4 percent.
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Darren Tristano, Technomic's executive vice president, said Boston's Gourmet has done a good job of expanding into the United States. And despite flat sales in the limited-service pizza segment, there are opportunities for casual-dining chains such as Boston's Gourmet in the casual-dining space.
"It just depends on what the concept focus is," he said.
For Boston's Gourmet, the focus has been, and will continue to be, on their core products, such as crust and toppings.
In addition, if changes need to be made, the company relies on its franchisees for industry feedback. "They're the frontline so they're going to give us the best information," MacDonald said.
Overall, MacDonald said Boston Pizza's core concept is strong, one that will carry Boston's Gourmet into the future.
"When I joined the company the owners' focus was on continual updates. We're not a standstill concept. A couple of years from now, we'll focus on what is going to make us better," he said.

Topics: Operations Management

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