A Call for Simplicity

March 6, 2002

Mike La Rosa didn't install a one-number call center at his 50-store Cincinnati pizza chain because it was cool or high-tech. Customer complaints drove him to do it.

"We wouldn't have done it if we hadn't been impressed by what our consumers were telling us," said La Rosa, president and chief people officer of La Rosa's Pizzeria. "They said we weren't doing a good job of answering the phone."

In the decade since, it appears La Rosa's staff has mastered some phone skills; the company has more than doubled its delivery and carryout sales, and claims to hold a 52 share of the Cincinnati pizza market. To handle the company's $96 million annual sales volume through the call center requires as many as 140 operators on duty.

Varol Ablak also likes his one-number center -- to the point of becoming a border-line data addict.

"The center is in our building downstairs, so it's easy to check the monitors, but I'm also having monitors installed in my office," says Ablak, president of Pizza Outlet, in Pittsburgh. Pausing for effect, he added, "I talked to the wife: I think I'm going to have one installed in our bedroom ceiling so I can see the data while I'm sleeping."

Just six months old, Pizza Outlet's one-number system is running in about eight of the company's approximately 100 stores, Ablak expects to tie them all into the network by June.

"I've been looking at this system since 1991 and was always impressed," he said. "Now that I've got it in, it's even better than I expected. And ultimately it's the customer who wins."

Neither Ablak nor La Rosa are alone in their enthusiasm. For instance:

* Afton Good Group saw its Toronto-based 241 Pizza chain of 170-plus units enjoy a 45 percent increase in average transaction amounts since installing a first-of-its-kind nationwide call center.

* Santa Barbara, Calif.-based Rusty's Pizza saw a 30 percent sales increase the first year it wired its stores to a one-number center 10 years ago. The next year it again registered double-digit gains.

"We've been voted the best pizza for 10 years," said Rusty's president, Dan Collier, president of the 18-store chain. "Not coincidentally, that's when the system went in."

Not coincidentally, all four operators use oneSystem software to drive their call centers. Other than a few proprietary systems, such as the one developed by 250-store Mazzio's Pizza in Tulsa, Okla., there are no call-center products available to the pizza industry.

" You get better results from ease of ordering for customers to less busy signals and hang-ups, and you (allow) store managers to focus just on operations."

Mike Baird
Partners Inc. (Pizza Hut franchisee)

oneSystem, based in Prince George, B.C., also includes among its customers Domino's Pizza franchisees in Iceland, Denmark, Canada and Dallas, Pizza Hut franchisees in Cleveland and Brunei, as well as corporate stores for New York Pizza and Al Capone's Pizza in Holland.

A Call to Inaction

The conveniences offered to customers by one-number call centers are obvious, but where call centers are most helpful to operators is in their elimination of phone calls to the stores. If a pizza maker has to stop production to answer a call and take an order, the flow of work is interrupted and the pace is difficult to resume. Additionally, users claim order-taking errors are significantly reduced when operators handle all the calls.

Allowing pizza makers to make pies and letting call center operators take orders streamlines the process on both ends, says, Stan McCabe, president and CEO of oneSystem. A major call center will handle 80,000 to 100,000 transactions a week, he added.

"You get better results from ease of ordering for customers to less busy signals and hang-ups, and you (allow) store managers to focus just on operations," says Mike Baird, whose Partners, Inc., in San Angelo, Texas, includes 28 Pizza Hut stores. He's currently testing the system in five stores.

More specifically, McCabe noted that managers are able to analyze data flowing to and from the call center -- in real time -- and solve problems as they occur.

"They love it because they can stand in one room and see 20, 30 ... 150 stores," McCabe said. "They can see how many deliveries are late, how many drivers are on the clock. ... They can literally run their chain out of one room."

It also allows operator, he added, to use the talents of the best managers to be used by multiple stores. Your "best-skilled people ... can essentially deal with the problems of, say, 30 stores. You wind up having good decision makers making good decisions."

Rusty's Collier agreed: "If a store gets crunched, we call the supervision team to go over and help that store. And we can re-route orders to a store that might not be as busy."

No Cheap Call

Installing a call center is not an inexpensive proposition, and, said McCabe, a company should have at least 10 stores to make it affordable.

"It generally costs you 3 percent of gross (sales)," McCabe said, adding that a top-of-the-line system will cost 4 percent, and a less-sophisticated set-up will run closer to 2.7 percent.

Collier admits he winced originally at spending what he did on Rusty's call center.

"You got a cool quarter million you know what to do with?" he asked. "But having 18 restaurants made it a lot easier to make the decision -- and it's obviously proven to be a good thing for us."

If call centers are so great, why don't the largest pizza companies use them? Collier simply said he thinks "they're nuts not to," but McCabe said the nature of larger companies is to try such initiatives on their own. Pizza Hut, for instance, once had a proprietary system, but abandoned it several years ago. Domino's, McCabe added, has had three or four systems that have come and gone.

"Corporations always believe they can do it better by doing it themselves," McCabe said. "Problem is, anytime you internalize in a corporation, it winds up costing three times as much to develop and it's four times as slow getting it ready. And to some degree, you wind up with development by committee."

Pizza Hut franchisees like Baird, however, are free to spend their money on a call center; having seen it work at a 50-store Pizza Hut call center near Seattle about nine years ago, he knew he wanted one for his company.

"That's when the computer took up half a room," Barid said. "And it was very, very expensive. Pizza Hut has gone away from it, but you could see it brought better results."

Meanwhile, Ablak looks forward to more monitors to scan and more business to track -- all from the call center. Pizza Outlet will eventually use an 800 number to cover all its stores nationwide.

"I guess what I like about it best is the customer service aspect," he said. "It's really tremendous for handling calls, handling complaints, tracking to see where deliveries are going and how long they're waiting in the store. It's a great management tool."

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