Dining as a vertical has been hit hard by the pandemic, but pizza has served as the exception to the rule. It turns out that in times of crisis, people turn to their favorite comfort foods to guide them through.
For example, Papa John’s on Thursday (Sept. 10) announced its largest North American traditional store development agreement in more than two decades, teaming up with franchisee HB Restaurant Group for a big push in the Philadelphia region.
“Papa John’s has long offered franchise investors one of the fastest paybacks in our industry. Recent record sales have driven further gains in store profitability,” Amanda Clark, Papa John’s chief development officer, said in announcing the deal. “Combined with our resilient eCommerce and delivery model, a transforming brand and significant whitespace, Papa John’s today offers franchise investors a truly compelling opportunity.”
HB Restaurant Group currently operates 43 Mid-Atlantic Papa John’s eateries but plans to more than double its regional footprint by adding 49 new locations in the Philadelphia/South New Jersey area over the next eight years, according to the announcement.
It’s a big vote of confidence, although one that perhaps Papa John’s and pizza as an industry have earned given their pandemic performance. After all, pizza has in large measure become the pandemic’s official food.
That’s due in part to the fact that while other restaurants scrambled to get pick-up and delivery options online, pizza chains like Papa John’s and Domino’s were already able to deliver — both metaphorically and literally.
In fact, QSR magazine wrote that America is entering the “Golden Era for Pizza Chains” for reasons that seem pretty obvious. Pizza parlors came into the crisis ready to roll on delivery and fulfill carryout orders because they’ve already been offering those services for decades.
Recent years have seen digital upgrades and enhancements, but pizza came to the party already prepared to meet customers' pandemic-related needs — no pivot necessary. For example, The Wall Street Journal (WSJ) reported that Domino’s was already roughly a year into testing a new service that would allow customers to select car-side pickup via the company’s mobile app and get their pizzas delivered directly to their trunks.
A slow rollout had reportedly been planned, but then the pandemic hit hard, and Domino’s shifted to a rapid one. WSJ reported. Incidentally, Domino’s was one of the few big U.S. firms to report a bona fide revenue surge in the second quarter (Q2).
And while WSJ said experts attribute much of Domino's success to major investments in developing ordering capability across voice, web and mobile, one of its more praised innovations was decidedly low tech — a cardboard “pizza pedestal.” That’s a cardboard box that Domino’s delivery drivers place on a customer’s front steps then put a boxed pizza on top of.
The pizza pedestal allows drivers to leave pizzas at customers’ doors for contactless delivery without putting hot pies on the cold ground. Never let it be said that Domino’s failed to put pizza on a pedestal.
But looking across the industry as a whole, it’s clear that pizza alone isn’t the silver bullet to protect against that pandemic’s pitfalls.
Consider Pizza Hut, which has a more developed dine-in business than Papa John’s or Domino’s and lacked pre-pandemic delivery from all U.S. locations. The chain saw a Q2 dip as it moved to get operations fully online and accessible for carryout customers.
Meanwhile, California Pizza Kitchen (CPK) has filed for Chapter 11 bankruptcy protection despite its status as a much-beloved brand. The company said it aimed to use Chapter 11 to “close unprofitable locations, reduce its long-term debt load and quickly emerge from bankruptcy as a much stronger company.”
CEO Jim Hyatt noted that the chain is one of many quick-service restaurants (QSRs) caught in the pandemic and forced to shutter locations nationwide.
“The unprecedented impact of COVID-19 on our operations certainly created additional challenges, but this agreement from our lenders demonstrates their commitment to CPK’s viability as an ongoing business,” he said. “Throughout this process, we will continue to deliver the same innovative, California-inspired cuisine that we have been serving for over 35 years.”
No matter what happens to any individual firm, one can confidently assert that whatever the new normal looks like, pizza will be part of it.
In fact, there might even be more of it than ever. After all, pizza might be the ideal food for these times: delicious, familiar, comforting — and available whenever you need it with a few quick taps on your connected device.