- WHITE PAPERS
The word is out in the Midwest: The take-and-bake chains are coming.
In 2003 alone Vancouver, Wash.-based Papa Murphy's Take 'N' Bake Pizza plans to add 100 Midwestern sites to its current base of 700 units.
Up-and-comer Bruno's Take-N-Bake Pizza Co. wants a piece of the action, too. Founded in Pioneer, Calif., the two-store company recently moved its corporate headquarters to La Porte, Ind., and is poised for a 45-store rollout in the lower Midwest and South this year.
For more than two years consultant Big Dave Ostrander has worked as a sort of pizza industry Paul Revere, warning operators east of the Mississippi that the most significant revolution in the American pizza industry since free delivery is coming to the heart of the nation.
Preaching ceaselessly at tradeshows, Ostrander has spread the gospel of getting a head start on the invaders by advising traditional operators to add take-and-bake pizza to their menus now before the pros have the upper hand.
"It's a little 'get them before they get you' thinking," Ostrander said in a recent interview. "Make no mistake, these guys (Papa Murphy's) are good. ... But the advantage usually falls to the guy who has it first. And people need to be thinking about getting a head start."
John Petrone, owner-operator of Papa Petrone's Take 'n Bake Pizza in Springfield, Va., got a long head start on take-and-bake competitors. But unlike some operators, he wishes the competition would move in more quickly.
"I've been here since 1988, but I'm still rare," said Petrone. "I still have to explain to people what (take-and-bake) is, so I can only benefit from competition that advertises. I just wonder what took them so long to be moving this way."
Rick Goss, founder of Bruno's, saw the take-and-bake void in the East and decided to leapfrog there from California rather than link together a cross-country chain of stores.
Recommended Take-and-Bake Operator Web Sites
"I knew there was no take-and-bake in that part of the country, which makes it a good area to establish ourselves," said Goss, who started Bruno's in 1991. "We're about 45 days away from completing our UFOC (uniform franchise offering circular), but we've already got franchisees signed up."
Not so fast
Heeding Ostrander's advice, Jim and Ann Reichle, owners of two Angelina's Pizza stores outside of Cleveland, added take-and-bake pizza to their menu more than a year ago. The two are winning converts slowly by offering a free small take-and-bake pizza with the purchase of a large baked pizza. And just as with their baked pizzas, they'll deliver take-and-bake with a minimum $8 order, plus a charge of $1.50.
"My goal is to have 10 percent of my pizza sales coming from take-and-bake," said Reichle, whose take-and-bake sales total about 8 percent of all pizza sales at her store in Olmsted Falls, Ohio. On Jan. 3, when Ohio State University played Miami University for the national championship in the Fiesta Bowl, that figure rose to 12 percent. "If I can get my take and bake sales that high, I won't have to buy another oven."
Marilyn Brophy added take-and-bake pizza to the menu at her Davis, Calif., Lamppost Pizza franchise nearly five years ago. Today, 15 percent of her pizzas sold are baked at home, and she'd like to see that grow.
"People like it hot right out of their oven as opposed to what they get when its delivered," said Brophy, who, unlike Reichle, discounts the price of her take-and-bake pizzas. Just like Reichle, however, she charges $1.50 for every delivery. "You can use whatever type of box or delivery bag you want, but it won't make the crust as crispy as baking it yourself at home."
If Brophy could add a drive-thru window to her restaurant, she said take-and-bake sales -- to-go sales overall, really -- would grow sharply.
* Wrap it up: If using standard plastic wrap instead of shrink-wrap, Dave Ostrander recommends the following:
* Since take-and-bake operations don't produce the sales numbers traditional pizza stores do, Goss recommends the following rule of thumb: "Choose a site where your monthly rent is equal to or less than the amount of sales your store can do in a day. ... You may start out with rent being as much as 8 percent of your sales, but you should get that down to 4 to 5 percent."
* Another Goss rule of thumb is to buy or rent small spaces. To make it in a 1,200 square-foot store, a take-and-bake operator will need about $500,000 a year in sales -- much higher than average, but very attainable in the long-term. (His main store is a diminutive 380 square-feet.) Also, he stresses getting a facility that has or can utilize a drive-thru window.
"We get a lot of calls from people on their cell phones in their cars while on the way here after work," Brophy said. "They'll call and say, 'I'm out front now, is my order ready?' They've got kids in the car and they don't want to get everybody out to come inside. So we do what we can to bring it out to them."
Goss had a drive-thru in his first Bruno's, and now he's not only convinced it's a natural for boosting take-and-bake sales, he wonders why more pizzerias haven't utilized them.
"Eighty percent of my traffic comes through the drive-thru," said Goss, whose main store is a 380-square-foot freestanding facility serving a town of 4,000 residents. "I wouldn't build one without a drive-thru."
Affordable to add on
Ostrander said that an operator can add take-and-bake pizza to the menu for as little as $200. All that's needed, he said, is a 24-inch-wide roll of plastic wrap, baking trays or baking paper (which requires cardboard discs), and printouts of customer baking instructions.
Because of their rigidity, Ostrander prefers baking trays such as those made by Pactiv. Reichle also prefers them because it doubles as a disposable serving dish; Brophy uses them as well.
Goss, however, prefers baking paper coated with a non-stick, vegetable based silicon. Not only is it cheaper, he said, it cooks the pizza better.
"With the paper you can cook the pizza at 450 F instead of 425 F," Goss said. "And baking trays reflect the heat while the paper allows that heat to come through. That makes the crust more crisp and crunchy."
Goss and Ostrander again are in opposing camps when it comes to wrapping take-and-bake pizzas. Goss believes in shrink-wrapping them, while Ostrander said standard plastic wrap provides a better air-tight seal and, when used correctly, keeps the baking instructions from contacting the pizza.
Moisture from the "toppings soaks through the paper, and that just looks dirty to me," said Ostrander. "This is just my opinion, but I also don't like the smell of melting plastic that shrink-wrapping gives off."
Goss not only believes shrink-wrapping holds the pizza together better, he also thinks it's faster than wrapping by hand.
"In stores with sales around $300,000, you can get by with one of those basic shrink-wrappers," Goss said. "But if you've got one that's doing a half-million dollars, I recommend you get a high-volume wrapping machine. It costs about $2,300, but it's worth it."
It's not just for pizza
Petrone said pizza makes up just 60 percent of his food sales; the rest comes from take-and-bake lasagna, ravioli and other heat-and-serve pasta dishes.
"We make fresh pasta here along with six homemade sauces," said Petrone, who also offers a broad line of desserts made by a supplier. "People don't want pizza every day, and not everyone wants pizza at the same time. So we give them something else they do want."
Pactiv (baking trays)
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Goss also believes in broadening menu options beyond pizza, and said he encourages franchisees to offer local specialty items.
"In one of our California stores we sell take-and-bake enchiladas, and in another we sell take-and-bake cinnamon rolls," Goss said. "It's good to meet each unique market's needs, but if an item doesn't make up at least 5 percent of sales over a period of time, try something else."
Bring 'em on
Reichle said the nearest Papa Murphy's store to her own is six hours away in Ft. Wayne, Ind. That's close enough for now, she said, adding that she hoped Papa Murphy's doesn't close in before she convinces North Olmstead's 8,000 residents that take-and-bake is a good idea.
Lamppost's Brophy, on the other hand, said she's proof an operator can adjust after the fact. Papa Murphy's and other small take-and-bake operations were long established before she reached out for her share of the bake-at-home market.
"Our sales continue to go up year after year, and (take-and-bake) keeps growing, too," Brophy said. "I believe it's a matter of having a really good pizza. People will always come if you have that."
Petrone said he wants take-and-bake competitors to move in soon because his business will grow from it.
"I think competition's good because it fires me up and gets me going," he said. "I'm always trying to improve, and if somebody comes in with a good product -- and they will -- it'll only make mine better."