“No One OutPizzas the Hut”
Pizza Hut is an international American restaurant chain/franchise started by two brothers from Wichita State University in 1958. It is very well known for an Italian-American cuisine menu mainly based on pizza and pasta, as well as side dishes and desserts. Pizza Hut is a subsidiary of Yum! Brands, Inc., one of the world’s largest restaurant companies. Pizza Hut has over 16,796 restaurants worldwide as of March 2018, making it the world’s largest pizza chain in terms of locations.
Pizza Hut is a leading chain of pizza restaurant companies in the world in terms of the number of outlets and percentage of market share that it holds. Its main objective is to provide food and related services at high quality and provide greater value and improvement in the lives of the world’s customers now and in the future.
Pizza Hut aims at an inclusive culture and fosters diversity and uniqueness as a business strategy. It is an intentional choice and aim of the company to sustainably develop a competitive advantage by cultivating its human resource.
Country of Origin:
Pizza hut is headquartered in 7100 Corporate Drive Plano, Texas 75024, United States. It is a subsidiary of Yum! Brands, Inc., the world’s largest restaurant company.
Countries of its operations:
Canada and Mexico in North America, India (not in the Pizza Hut division, but in the Yum! India division), Bangladesh, Pakistan, Australia, New Zealand, United Kingdom, Sweden, Norway, Finland, Germany, Spain, Turkey, South Africa, Honduras, Costa Rica, El Salvador, Guatemala, Colombia, Venezuela, Chile, Brazil, Peru, Tanzania, Ecuador, and Nicaragua, and its Asian presence includes Japan, Saudi Arabia, the United Arab Emirates, Qatar, the Philippines, Vietnam, Thailand, Malaysia, Singapore, Indonesia, Brunei Darussalam, China (now part of Yum! spinoff Yum China), Hong Kong, South Korea, Myanmar, and Macau. Pizza Hut was one of the first American franchises to open in Iraq.
History of Pizza Hut:
Pizza Hut was founded on the 15th of June, 1958 by two brothers Dan Carney and Frank Carney in their hometown of Wichita, Kansas. Based on a friend’s suggestion they planned to open a pizza parlor, which was then a rarity for which they borrowed $600 from their mother and with a business partner John Bender began Pizza Hut.
Renting a building at 503 South Bluff in downtown Wichita and purchasing the equipment to make pizzas, the Carneys and Bender opened the first Pizza Hut restaurant within a year in 1959, Pizza Hut was incorporated in Kansas, and Dick Hassur opened the first franchise unit in Topeka.
Today Pizza Hut is acknowledged as a world leader in the pizza industry and also the world’s largest pizza chain with more than 6,100 restaurants in the United States and over 5,500 restaurants in 97 countries and territories around the world, employing more than 300,000 people, serving 1.7 million pizzas everyday to more than seven million customers.
“We take pride in making a perfect pizza and providing courteous and helpful service on time all the time. Every customer says, ‘I’ll be back!’ We are the employer of choice offering team members opportunities for growth, advancement, and rewarding careers in a fun, safe working environment. We are accountable for profitability in everything we do, providing our shareholders with value growth.”
“P.E.A.R.L.S- Passion for excellence in doing everything Execute with positive energy and urgency Accountable for growth in customer satisfaction Recognize the achievements of others listen and more importantly, respond to the voice of customers.”
The vision of Pizza Hut is to “reach on the top of the peak to provide best service and taste” & “To see Yum on customer’s face”.
“Our goal is to reach 85% recognition of the new product in our target market. As with all businesses, the most important goal of a company is to increase revenue and profits. Customer satisfaction is foremost. Practice what we preach: integrity, ethics and open communication.”
“Part of the largest restaurant chain in the world Over 20,000 franchises around the world Brand leader in the UK Innovative range of pizzas under one roof Famous television advertising etc.”
With more and more types of fast foods and varieties of cuisines available to customers, the satisfaction of the pizzas is declining. With complex technology and various networks of complex computer systems all over the world, there are many problems (logistics) also many a time there are internal conflicts among franchisees.
New versions and types of Pizzas with different crust sizes, toppings, and various flavors are being created to suit various tastes around the world with an emphasis on indigenous preferences and resources available in that region. E.g. Indian market menu is unique and vastly different than the old US menu.
Rising competition world over from companies like Dominos pizza, Mc Donald (McPizza), Papa John’s pizza, Subway, Smoking Joes, Taco Bell etc is reducing profits and profit margin. Rising cheese costs and fluctuation in the international markets (depression) pose great threats.
Analysis of the market and future prospects:
Most pizza chains have been diversifying into various new non-pizza items such as Buffalo wings and Italian cheese bread along with the normal pizza menu. The trend today is to come up with something newer, bigger, better pizza at a low price. Offering special promotions (daily specials/combos), offers (buy one get one free) are also common.
Pizza Hut is a trailblazer and trendsetter and usually the first entrant into the market which gives it the first mover advantage which has also been their marketing strategy in the past. Pizza Hut has built a strong goodwill and brand image which helps in attracting target customer and entering new markets easy.
But entering first comes with its own share of problems and restrictions like high tax rate, registration fee, establishment expenses, quota system, high employment rate, high production costs and social, political, cultural, values and economical condition prevalent in the host country which can hamper growth and expansion.
Other disadvantages faced are -due to brand image the chances for diversification and “Freedom of choice” for customers in the menu and product development are lost.
Rewards and compensation:
Pizza Hut gives many kinds of rewards for its employees like pay raises, promotions, awards etc. Employees who work in Pizza Hut take “Pride in their performance” and develop a “Sense of achievement”
The company announced a rebrand that began on November 19, 2014. The rebrand was an effort to increase sales, which dropped in the previous two years. The menu was expanded to introduce various items such as crust flavors and eleven new specialty pizzas. Work uniforms for employees were also refreshed. In 2017, Pizza Hut was listed by UK-based Company Richtopia at number 24 in the list of 200 Most Influential Brands in the World.
Comparison between Sapphire and Dil stores
What one has to know?
• Its core competency is to cater to customers in a better way
• less priority to money or income
• it accepts all feedback and tries to improve to the best of its ability
• it maintains the good relationship with customers support agents and call centers
• it also maintains the good relationship with people in its distribution channel and agents (third party delivery partners – Swiggy, Zomato, food panda etc.) who represent its business
• due to better service and relationship with customers, the profit margin is higher
• If there is any problems or any delay in delivery the customers are contacted and given some freebies (coupons, discounts, free side dishes)
• Even if customers are misbehaving or abusive to the employee they do not react and maintain their cool while serving the customers to the best of their ability.
• Customers prefer sapphire store while an employee is less inclined to work in the sapphire store
• They do provide the store number
• Sapphire store prepares/make their dough themselves and supply it to the Dil store.
• Most of the time sapphire store adheres o the 30 minor free delivery policy.
• Complimentary items are provided free of charge in most cases
• Issues are taken seriously and problems are escalated to the higher authority
• The workload on the employee is slightly high
• They have only regular offers for their customers
• Franchisers prefer sapphire store over Dil stores
• Core competency is to increase profits and attain higher profit margins
• More priority is given to generate income
• They focus on the business aspect and less on the consumer feedback/suggestions
• They are mostly insincere in maintaining relationships with call centers, and support agents.
• It maintains average relationships with the third party delivery partners such as Swiggy, Zomato, food panda etc.)
• It is comparatively harder to maintain reasonable amounts of profits due to poor customer relations
• Customers are not kept informed about the delays or any problems in the kitchen
• Employee are empowered and there is a zero tolerance towards abusive customers
• Employee prefer to work in Dil store as they have more freedom and flexibility
• Doesn’t provide store number to customers
• They always buy the dough from the sapphire store and don’t make their own dough
• Rarely Dil stores abide by the 30 minute or free delivery policy
• Complimentary items are rarely given to customers
• Issues are not taken very seriously and rarely escalated to a higher authority
• The workload on employees is slightly lesser
• There are special offers given to customers only in Dil stores to attract more customers (unlimited [email protected])
• There is less preference to the franchise in Dil stores
Similarities between Sapphire and Dil stores
? These two different franchises come under the pizza hut umbrella name.
? Terms and conditions for both stores are standard according to the pizza hut policies
? They have made sure that the divisions of stores under these franchises are kept under wraps and the public are not privy to the information.
? The product lines are similar in both stores with a pan India menu
? Since Dil stores buy the dough from sapphire stores the quality of the base is same
? The vegetables used are bought in bulk and so the standard is maintained in all the stores
? All the stores of pizza hut use only mozzarella cheese
? All the stores of pizza hut use the only wheat crust
? Working hours in all the stores across India remains the same (11am-11pm)
? Dress code is similar in pizza hut across India
? Pizza Hut is known for its pan crust pizzas since they use a pan to bake pizza across all stores
? Designation/post are standard in all stores
? Women are empowered and every store has women employees
? Birthday party option is available in all dine-in stores of pizza hut irrespective of sapphire or Dil store.
? In all pizza hut dine-in stores, the pizza is served and there is no self-service.
? They stop taking orders after 10:50 pm in all stores in India
? All pizza hut stores are tied up with PepsiCo to serve its beverage products
Pizza hut entrance into the emerging market of India
Pizza Hut entered India on June 18, 1996, with its first restaurant opened in Bangalore through with police protection amid threats and tensions caused by Karnataka Rajya Raitha Sangha (KRRS), farmers’ association and some pro-vegetarian groups. Since then it has captured a dominant and significant share of the pizza market and has maintained an impressive growth rate of over 40 percent per annum.
Pizza Hut now has 95 outlets across 24 cities in India; and employed nearly 4,000 people by end of 2004. Yum! has invested about US$ 25 million in India so far; this is over and above investments made by franchisees. Yum! Brands Inc is the owner of the Pizza Hut chain worldwide. A Fortune 300 company, Yum! Brands own Kentucky Fried Chicken, Pizza Hut, Taco Bell, A&W and Long John Silver’s restaurants worldwide. Yum! generated more than US$ 25.9 billion in worldwide sales in the year 2003, and has more than 33,000 restaurants in over 100 countries.
According to Yum! Restaurants International, India is amongst the top five growth markets for Pizza Hut. Pizza Hut is also experiencing double-digit growth in India and hence is confident about expanding its operations in India.
Pizza Hut as a multinational company has had to adapt and change to the indigenous taste and preferences of Indian customers while also keeping the prices low/affordable. This has led to the creation of an Indian-ised menu with vegetarian/Jain and local ingredients and spices combined with a few international items.