Lean pizza, fat profits

May 10, 2004

When Vic Cassano heard the rising clamor about low-carbohydrate dieting some years ago, he didn't listen too closely. As president and CEO of 30-unit Cassano's Pizza in Dayton, Ohio, he'd seen low-cal and low-fat diets come and go, and surely the Atkins Diet and the South Beach Diet would follow suit, he thought.

But they haven't. Researchers believe 17 percent of Americans are on a low-carb diet, and books about the Atkins and South Beach diets remain on the New York Times' Best-Seller list, where they've been for years.

Every segment of the foodservice industry, Cassano said, is working to provide at least a few low-carb options to customers—and that's a near death-defying feat for the pizza industry, whose core product is high-carb central.

Until now.

A growing number of pizza companies are adding low-carb dough options to their menus. After months of testing, Cassano's rolled out its own in early May, a few months behind a group of other pizza chains that, ironically, doesn't include any of the industry's top four chains.

"I'm amazed that a lot of the players that have the dollars to throw at something like this haven't done it," said Cassano. "But I'm just fine with being one of the first."

When 40-unit Pizza Magia, based in Louisville, Ky., added a low-carb pizza to its menu this year, it never expected such a strong response, said CEO Dan Holland. Shortly after the initial rollout, low-carb sales represented

What's Important

Love it or hate it, the low-carb trend is here to stay, and several pizza operators are reaping strong sales from low-carb pizza menu items.

In most cases, low-carb doughs are made by specialty blends or crust makers. Many operators are using parbaked crusts, while others are making the dough fresh in the store.

Operators aren't sure who exactly is buying their low-carb pizzas, but many claim as much as 25 percent of their sales mix is centered on low-carb pizzas.

a stunning 22 percent of the chain's sales mix.

"We expected about 10 to 12 percent, but never 22 percent," said Holland. "It's settled in at 15 percent for now, and we think it'll hold there for some time."

Holland said Pizza Magia wanted to do a low-carb dough for the better part of a year, but just as Cassano's found out, developing a dough nearly free of starches and sugars—while tasting good, too—wasn't easy. Like Cassano's, the company settled on a parbaked dough skin made by an outside supplier.

"It was a trial to get this dough operationally sound, where it wasn't difficult (for the staff to produce)," Cassano said. "We didn't want to change any of the procedures, because when you do that to even one item, the chances of getting it screwed up are excellent."

Some companies are making their low-carb dough in the stores, including Papa Murphy's Take 'N' Bake Pizza and Eatza Pizza, an all-you-can-eat buffet chain in Phoenix. The 23-unit company introduced its low-carb pie in April.

"We had a company make us the dough blend; we add water, proof it and then bake it exactly like our regular pizza," said CEO Ron Stilwell. "All the procedures are exactly the same, which made training for this new item easy and consistent."

Stilwell said it's too early to

Pizza Magia's low-carbohydrate pizzas.

measure the sales impact of Eatza Pizza's low-carb pie, but he expects a strong response when the chain rolls out its advertising program this month.

"Right now, without advertising, the people who come in for our all-you-can-eat buffet aren't exactly the types worried about low-carbs," said Stilwell. The low-carb pizzas, he added, aren't sold on the buffet. "We serve an 8-inch personal pizza with the all-you-can-eat salad bar for $4.99. That allows us to control the number of carbs. If it's on the buffet and you eat a ton of it, it's not low-carb any more."

Rob Elliott, executive vice president of marketing for Papa Murphy's, said the chain's Thin Crust deLITE pizza, introduced in January, accounts for 25 percent of its sales mix.

"It's fluctuated as high as 30 percent," said Elliott, whose 800-unit company is based in Vancouver, Wash. Though such numbers exceeded everyone's expectations at Papa Murphy's, Elliott expects things will cool off over the long term. "Those kinds of sales are probably not sustainable. We're promoting it very heavily right now, too, and new product news always gets attention. In time, it'll settle in and become a healthy percentage of the product mix."

Hard data is good to find

Almost every operator said more time is needed to pinpoint exactly who is buying their low-carb pizzas, but early results skew toward women, said Pizza Magia's Holland.

"I think women are big users of the product, but I don't have hard numbers to see what that percentage would be," he said. "Based on my time in the stores, I've seen a lot of women buying them for lunch and take them back to their offices."

Holland said low-carb pizza sales are stronger in white-collar areas than in blue-collar areas.

Alex Green, director of marketing, Panago Pizza in Abbotsford, British Columbia, said a very broad spectrum of customers are trying the 155-unit chain's new low-carb pizza.

"It used to be that this trend skewed toward women and the older generation, but we've seen a lot of younger consumers who are more aware of (diet) trends and are considering new approaches to their diets," said Green. "I think there's a lot of mainstream consciousness around that leads people to count their carbs more."

Papa Murphy's Elliott dims the demographic light even further. Much of the appeal of the company's new low-carb pie is due to its thin crust, something it never offered before. "I'm sure that's a big factor. They now can get a thin-crust and low-carb pie from us at a great price point."

Does it have legs?

How long the low-carb trend will last is anyone's guess, but if the evidence left behind by the low-fat craze of the 1990s is any indicator, it won't wane soon. That period ushered in a multitude of new food products—low-fat dairy foods, lean meats, low-fat salad dressings and condiments, desserts, etc.—which still sell well in groceries and restaurants.

At the very least, every operator said they expect their low-carb sales will peak and dip, but unlike what happens with some new product trials, all said they expect their low-carb pies will remain on the menu.

"This has gone well for us, and we expect it'll be around for awhile," said Green.

Holland said he expects the trend to continue for a long time, but not necessarily because people are low-carb crazy. Many people who'd all but given up on pizza because of general diet restrictions are coming back as customers.

"We saw a lot of customers who were sitting on sidelines dieting and telling themselves that pizza couldn't be part of their daily routine," he said. "We know now that they really appreciate the opportunity to come back and eat pizza. So we see this as just another option we've given them."

If the low-carb trend loses its legs soon, will all the effort to meet such a pressing demand be wasted? Cassano said no. As perplexing as new diet trends often are, anytime you provide customers additional points of entry, it's worthwhile, he said.

The low-carb diet "is a funny thing, because you can have all the sour cream and butter you want, but you can't have the potato," said Cassano, summing up the confusion in balancing diet trends both past and present. "But though I don't expect this to be landslide, I do expect it to give our customers another reason to consider Cassano's. That's important."

Topics: Dough , Papa Murphy's Take 'N' Bake Pizza

Sponsored Links:

Related Content

Latest Content

comments powered by Disqus