Buffet all the Way

April 19, 2004

Eatza Pizza, a 23-unit, value-priced all-you-can-eat chain based in Scottsdale, Ariz., wants a bigger slice of the buffet business.

On Jan. 21, it signed a 25-unit development agreement for northeastern and middle Ohio, and according to Eatza Pizza President and CEO Ron Stilwell, the company has two area development agreements in the works in California and Washington.

Eatza Pizza has units operating in seven states, and the goal, he said, is to have 55 total units by the end of 2005. Key to achieving that growth is a new look and operational floor plan headquarters is rolling out to all its markets.

"It's much friendlier, warmer, more inviting and less like a cafeteria than what we have now," said Stilwell. "We've installed new pizza buffet bars, pasta bars, beverage bars, salad bars and dessert bars. ... We've spent an enormous amount on re-branding the whole concept."

Founded in 1997 by Berne and Ronda Fleming, the couple and their partner, Tom Jones, sold the chain to investor Barry Smith (founder of the publicly held VistaCare hospice care company) last October.

Shortly after, Smith hired an operations and management team headed by Stilwell. Joining him are Chris Utterback (executive vice president) and Garth Moore (vice president of operations).

Buffet and games

Eatza Pizza's $3.99 dine-in price includes a broad selection of pizzas (rotated monthly), pasta with marina or Alfredo sauce, salad bar and "pizza desserts." Limited add-ons include chicken wings, and every store offers carryout.

The concept attracts multiple customer segments, Stilwell said, but families and senior citizens are top targets. The customer base at one of the chain's Arizona stores, he said, is at least 50 percent senior citizens, a demographic pizza operations struggle to attract.

Redemption games, the chain's entertainment component, draw the kids, he added, but the games' contribution to overall revenues is much less than at eatertainment leader Chuck E. Cheese's.

Stilwell, who was vice president of operations at Los Angeles-based Shakey's from 2001 to 2002, believes his experience gained there will serve him well at Eatza Pizza; Shakey's units run lunchtime buffets and most all provide redemption games.

Still, he said Eatza Pizza is more akin to a CiCi's Pizza unit. The 475-unit buffet chain, based in Coppell, Texas, sells pizza, pasta and salad, but has no games. Shakey's provides table service and a broader menu that includes fried chicken.

Stilwell acknowledged that buffet competitors like CiCi's—which already is 20 times larger than Eatza Pizza and fulfilling development agreements for at least 200 more units over the next several years—could challenge his company's growth down the road.

"There are no CiCi's where we are; in fact, there are almost no (pizza) buffets out West," he said. "So without having to go head-to-head against CiCi's, we don't have much competition. Peter Piper came after us with a lunch buffet (in Phoenix), but it didn't have any effect on us."

If a pizza operation offers buffets only as a sideline, Stilwell said he doesn't view them as competitors.

"If you're not committed to buffet, you can have a tough time making it," he said. "The buffet business is an exact science. You have to be very careful about purchasing, selection, knowing what should be first on the buffet line and last ... there are lots of details."

Choice, value and full control over the speed of self-service is something time-pressed customers want, he added. "You can get in and out of an Eatza Pizza at lunch in 20 minutes and be headed back to the office. Or they can stay a while if they want."

Entry fee

An Eatza Pizza franchise costs $250,000, roughly $100,000 more than the average delivery-carryout site.

Stilwell said the company prefers new operators come to the table well capitalized; those who aren't can't borrow more than 50 percent of the cost for their first store. Experienced pizza operators, he said, will be allowed to borrow more on subsequent units.

The number of franchise inquiries, he said, are picking up now that the company has hired a marketing and public relations firm.

"We obviously see a lot of potential for this concept and expect it to grow well in the next few years," Stilwell said. "We think it can be the next Baja Fresh or Chipotle."

Topics: CiCi's Pizza , Operations Management , Pizza Hut

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