Even though pizza was invented in Naples, it’s still as American as well… pizza. With approximately 3 billion pizzas sold in the United States each year, you’d be hard-pressed to find too many Americans that don’t crave a good pizza pie from time to time.
And if there is anything people love more than pizza, it’s the convenience of having a reasonably affordable meal delivered to their doorstep. Therefore, in this era of instant gratification, pizza delivery and takeout represents a solid and lucrative business opportunity. If you’re inclined to entrepreneurial pursuits, a pizza delivery/takeout restaurant is probably a business sector you’ve considered.
Let’s take a look at some more statistics that support the notion that a pizza delivery business can be successful:
- Pizza is a $45.73 billion industry per year in the United States.
- American adults and children eat an average of 46 slices — or 23 pounds — of pizza a year.
- Americans eat approximately 100 acres of pizza each day, or 350 slices per second.
- 83 percent of consumers admit to eating pizza at least once a month.
These statistics all point to the reasons why pizza restaurants that offer takeout and delivery are among the most popular dining segments in the U.S. and why the success of these businesses eclipses that of many other types of new restaurants.
Still, there is no guaranteed “sure thing” when it comes to starting and running your own business, no matter how popular the product you’re selling. As with any business venture, adequate planning and forethought are essential. You will also have to find the right pizza restaurant!
Ownership details to consider
With some 76,933 pizzerias in the U.S., you’re in good company if you opt to buy into this sector — but there’s also plenty of competition.
There are two paths to entry, so you’ll need to decide whether or not to buy into an established pizza franchise, or to open your own independent location. Franchising is compelling considering that more than 60 percent of national pizza sales occur at chains.
Domino’s, which is now the top U.S. pizza franchise in sales, grew its retail sales 8.3 percent last year. The other top chains are:
- Pizza Hut
- Papa John's
- Little Caesars
- Papa Murphy's
(While there are about 50 additional chains that can be considered national franchise options, they currently have a relatively small regional popularity in comparison to the bigger players.)
Franchising can also help you eliminate some of the steep startup costs of opening your own pizzeria, but you will pay monthly franchising fees. These fees typically extend for at least one year while the location is established and begins to turn a healthy profit.
In exchange for these fees, you will get the benefit of an established brand that consumers already know and trust. You will also have the backing of a parent corporation for things including supply sourcing, marketing support, and business development support. All of these things can be appealing, particularly if you’ve never run your own business in the past.
Opening your own pizzeria, or purchasing an independent one, certainly has advantages as well. Many entrepreneurs find this option more appealing because it enables more freedom in menu options, and more overall creativity when running the business. If you have a particularly unique and exciting menu or innovation that would set your pizzeria apart from the competition, then an independent shop is likely a more viable option for you.
Whether you choose franchise or independent ownership, the location you choose will be one of the key factors in your success.
Many areas in the U.S. are already heavily saturated with pizzeria options. Your location should strike a balance between proximity to a consumer base that will support a new pizza shop, and being a reasonable distance from competitors.
The most successful pizza shops are in areas that are populated densely enough to attract dine in and takeout customers as well as those who want their pizza delivered. Servicing a wide delivery area will also help to separate you from the competition — especially as an independent owner. You'll need to do your due diligence to determine how to profitably implement delivery in your location.
No matter which path to ownership you take, you’ll want to consider how you will staff your pizzeria. If you want to offer dine-in options as well as take-out and delivery, you will need to hire wait staff. And when it comes to deliveries, you will need to make sure you consider all that is involved in vetting and hiring delivery drivers. This includes verifying licenses and DMV records, background checks, etc.
You’ll also need to make sure that your staff is at a level that allows you to cover all of your needs, while still offering competitive enough wages to attract reliable and quality employees. The average currently hourly wage for a pizza delivery driver in the U.S. is $10. While delivery drivers are typically entry-level positions, competition from other dedicated food-delivery services can make staffing more challenging — and more costly.
And, thanks to the likes of DoorDash, Grubhub, and Uber Eats, the demands of these entry-level workers are changing. These online food delivery services allow employees to set their own schedules vs. having to adhere to the set schedules dictated by typical pizzeria delivery needs. Therefore, you may need to staff more heavily to cover all of the hours in your delivery window.
The pizza personality
Finally, before deciding to commit to owning a pizza delivery/takeout business, you’ll need to consider if your personality is truly suited to this sector. First and foremost, you have to be a “people person,” capable of both offering great customer service, and dealing with lots of different types of employees, suppliers.
You also need to be business-minded enough to find pizzerias for sale, and to handle the back-end business operations of your business, such as record-keeping, bookkeeping, filing your quarterly and annual taxes, and making sure you have the proper insurance and legal coverages in place. Luckily, if this last part isn’t your forté, you can hire professional services to help, including a business broker, an accountant, and a lawyer.
What the future holds
As far as new business ventures go, the pizza business is certainly one of the most appealing. With fast-food revenues projected to hit $690.80 billion in 2020 — and pizza accounting for 15 percent of that industry — your chances of a successful future owning a pizzeria eclipse many other entrepreneurial opportunities.
You will likely see increasing demands for transparency in ingredients from consumers in 2020 and beyond. As Americans continue to strive to make healthier eating choices when consuming fast food, you’ll need to be prepared to accommodate customer requests for more details about your menu, and to provide more diverse and healthier options.
So, if all of this sounds doable, and you’re excited about a future as the owner of a pizzeria that offers takeout and delivery, it’s time to start charting your path. Will you start your own business from the ground up, or buy one of the many pizzerias currently for sale? No matter which you choose, there are plenty of ways for you to cash in on this growing segment.
If you’d like to learn more about buying a business, including options for financing your new business venture, check out all of the resources available from BusinessesForSale to help you.