Pizza operators take slice of Internet pie

Feb. 14, 2007
Billions of dollars' worth of goods and services are being transacted over the Internet every year, and that number keeps increasing. According to a study by research firm JupiterResearch, online sales topped $84 billion in 2005 and are expected to pass $1 trillion by 2012.
For the restaurant industry, a big slice of that online pie is of the pizza variety. Pizzeria operators are finding that the online world is a perfect match for their business.
Louisville, Ky.-based Papa John's International Inc., which entered the online pizza fray in 2001, has seen its online business increase 50 percent a year for the last several years. Since the company launched online ordering through its Web site, the country's third-largest pizza company has taken more than 25 million online orders, according to company spokesman Chris Sternberg.
"In 2006, we transacted more than $200 million worth of business through our online ordering site," Sternberg said. "It's definitely here to stay."
Papa John's customers like to control the pace of their own order, and they never get put on hold, Sternberg said. Online customers also tend to order more food and more often, he said.
"Nearly all of us are online and many of us live there for many hours each day," Sternberg said. "Papa John's wants to be where people live and where they are most likely to want to take care of business."
Order simplification
Online ordering isn't just for the big boys. Smaller players and even one-unit operations are getting into the online act. However, the key is getting the order from the customer to the kitchen in a simple and easy-to-manage manner.
Pedro Galetti, who owns two Mozzarella di Bufala pizzerias in San Francisco, began taking online orders about 10 years ago. Originally, online customers placed an order through a third-party Web site, which then faxed the order to the restaurant.
"We're in the heart of Silicon Valley, so we've always been a technology-driven business," Galetti said. "If we have the means to make it easier to deliver our goods to the customer and communicate to the customer, we're going to use it."
Each Mozzarella di Bufala restaurant receives about 10 to 15 online orders a day, Galetti said. And that number is growing.
The six-unit Rascal House Pizza chain, based in Cleveland, began taking online orders about four years ago, said president Mike Frangos. Like Galetti's restaurants, Rascal House also used an online service which then faxed the order to the restaurant.
Still, the process had its pitfalls, Frangos said. Taking orders by fax was cumbersome and unreliable, he said.
Galetti agreed with Frango's assessment.
"When the fax comes in and the counter people aren't paying attention, the fax could sit there for 30 minutes or so depending on how distracted you are," Galetti said. "The machine can jam or it could run out of paper. There are a lot of variables."
The ease of synchronization
This year both companies began using OrderLink Gateway, a product developed by Abbotsford, British Columbia-based SpeedLine Solutions Inc. SpeedLine specializes in point of sale systems for the pizzeria industry.
OrderLink Gateway interfaces a SpeedLine customer's POS system with the restaurant's Web site.
"The order goes right to my POS printer in the kitchen," Galetti said. "This is what I've been chasing for years."
Both companies had already been using POS systems supplied by SpeedLine.
"With people spending an average of 17 percent more when they order online than when they order by phone, the upside is huge for a lot of restaurants," said Jennifer Wiebe, marketing manager for SpeedLine Solutions.
OrderLink Gateway also integrates with Web ordering portal Golicious, and SpeedLine is working to integrate the product with other online-ordering portals
Any investment in technological upgrades can be quickly recovered, said Doran McLaughlin, business development director with Vancouver, British Columbia-based Brygid Technologies Corp., a developer of e-commerce Web sites. Several of Brygid's clients have been able to reduce phone-order staff by as much as 30 percent.
"The customer does all the work, and when the kitchen sees the order it appears as a production ticket," McLaughlin said. "That's where the savings are realized."

Topics: Online Ordering

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