Marco's Pizza averaging one opening a week

Sept. 5, 2012

Toledo-based Marco's Pizza recently celebrated its 300th store opening. The Wheeling, Ill., unit is also the brand's first location in Illinois.

Opening an average of one new store per week, Marco's Pizza now operates restaurants in 24 states and the Bahamas, and plans to open more than 85 locations by the end of this year.

Company plans also call for having a total 1,500 restaurants open and operating in the next seven years.

"We've accomplished considerable growth in the past few years and continue to strike multi-unit deals in new areas around the country to expand our footprint," said Marco's Pizza CEO Jack Butorac. "Our continued success, despite a weakened economy, is a true testament to the brand and all that we've done to position ourselves atop the multi-billion dollar pizza industry."

Butorac noted that in addition to system growth, many Marco's Pizza locations are continuing positive same-store sales to date in 2012. Marco's Pizza same-store sales since the beginning of 2011 have been 7.04 percent system-wide and 10.85 percent in company-managed stores.

Several initiatives have helped the company expedite its growth, including a partnership with Family Video, financing options for would-be franchisees and the creation of a "hybrid" franchise model.

  • Family Video partnership: In February 2012, Marco's Pizza entered into a $100 million deal with privately-held movie rental chain Family Video to open Marco's outlets within as many as 350 of its movie stores.
  • Pizza equity: Marco's Pizza raised $20 million in private equity funding to assist operators with down payments. The company also established a leasing arm to help franchisees upgrade equipment or build entire stores, which typically cost $250,000. It also secured millions of dollars in additional capital to assist new and existing franchise owners.
  • Mass brand migration: Marco's Pizza has created a "hybrid" model by recruiting talent from other brands -- including Fuddruckers, Domino's Pizza, Mercedes-Benz, Starbucks, Panera Bread, Boston Market and Ruby Tuesday. With this model, certain senior management positions create individual holding companies which become shareholders of Marco's Pizza, giving them a vested interest in the company's growth.

Read more about franchising and growth.

Topics: Business Strategy and Profitability, Financing and capital improvements, Franchising & Growth, Marketing / Branding / Promotion, Operations Management

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