Whatever challenges beset local restaurants last year, they haven’t dampened the expansion of one industry segment: pizzerias. By January, the list of recent or forthcoming arrivals included the family-friendly Oscar’s Ice Cream and Pizza Joint, Papa Murphy’s take-and-bake, local venture Red Zeppelin, PieWorks Pizza by Design from Shreveport, Little Caesar’s, Hungry Howie’s and New Orleans-based Naked Pizza.
“It’s not going on elsewhere in the state like it is in Baton Rouge, but pizza is a strong segment right now nationally,” Louisiana Restaurant Association spokesman Tom Weatherly says. “Consumers see a value proposition there.”
National chain Little Caesar’s recently opened stores on Government Street and O’Neal Lane, and has plans for around 20 restaurants throughout south Louisiana, says Operating Partner Adam Serrano. Quick-service chains like Little Caesar’s and others have fared well, says Weatherly, precisely because they offer a popular item at a low price point.
According to the franchise consultant Pizza Marketplace, larger chains occupy about 60% of the national market with the remaining share belonging to independent operators, many of whom aim to capture diners looking for atmosphere and diverse ingredients.
PieWorks is one such independent whose brand is based on the concept of choice. The restaurant offers extensive options in sauces or bases, types of cheese and vegetable, meat and seafood toppings.
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Founder Marc Able says the Baton Rouge market appeals because it has high growth potential.
“We saw the market as being underserved. In an area this size, there were only 49 pizza restaurants, and only 11 of them we saw as our direct competition,” he says.
PieWorks likes to count families and college students among its target audience, another element in Baton Rouge’s favor. The restaurant will open two locations—on South Sherwood Forest Boulevard in May and Jefferson Highway in July in renovated buildings formerly occupied by the Schlotzky’s deli chain. Able says the sites complement the PieWorks model: freestanding storefronts with good access and ample parking.
“We did it as a package deal. The locations matched what we wanted to do,” he says.
While PieWorks focuses on consumer participation, sit-down service and an expanded menu, Naked Pizza from New Orleans advances the concept of pizza-as-health-food. The restaurant’s whole-grain crust includes probiotics for ease of digestion, and no additives, chemicals or sugar. Naked Pizza recently attracted investment from Dallas Mavericks owner Mark Cuban and Kraft Foods to help it expand nationally. It aims to capture both the health-conscious and the pizza faithful.
Many newcomers to the Baton Rouge market, including PieWorks and Naked Pizza, are targeting a demographic historically drawn to DeAngelo’s, launched in Baton Rouge in 1991. Today, there are six locations in Baton Rouge, Denham Springs and Prairieville, five of which have morphed from straight-up pizza-and-calzone shops to casual-dining eateries with expanded Italian menus.
Founder Louis DeAngelo says he plans to keep doing what he’s been doing despite the new competition.
“For us, it’s less about a strategy and more about our particular culture,” he says. “We’ve already been making tweaks to what we’ve done for the last 10 to 12 years. Whether more restaurants open up, it won’t change the way we do things.”
SLICING THE PIE
The top 100 pizza chains had U.S. sales of $18.8 billion in 2008, up 2% over 2007, according to Chicago-based research and consulting firm Technomic. The total limited-service pizza industry grossed $29 billion, with growth comparable to the total restaurant industry at 0.4%.
Pizza Hut led the top 100 chains with $5.3 billion in U.S. sales in 2008, up 3.9% over 2007; it also registered unit growth of 1.3%. Domino’s Pizza and Papa John’s followed with $3 billion and $2 billion in sales, respectively. Papa John’s grew sales by slightly more than 3%, while Domino’s netted a decrease in sales of almost 5% in 2008.
Within the limited-service pizza segment, four out of the 10 fastest-growing chains by percentage of sales growth were in the fast-casual subsegment: California-based Straw Hat Pizza, California-based ZPizza, Indiana-based Puccini’s Smiling Teeth Pizza and California-based RedBrick Pizza, none of which have locations in the Capital Region.
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