Another Competitor Opening in Less than One Week!

Here we go again. Another competitor is apparently opening on Monday. I’ve known for months now but have been unsure of the date. We actually had a few people come in to the shop today looking to apply to an “upscale pizzeria”. I took a look on craigslist and this is how they’re advertising their restaurant to prospective employees. An employee of mine knows someone who got a job there and says Monday is the target launch date.

Unlike 10 months ago when it was Domino’s, this time it’s a privately owned Dine In/Carry Out Pizzeria. I do not think they will be delivering. I have no idea of the quality of their food. I do know that from the outside, the place looks nice and they certainly spent plenty of money on the build out.

My business is primarily DelCO. I’ve prepared a bit more for this opening then I did for the unexpected Domino’s opening which I’m still hurting a little from. I had a full menu mailed out in a Valpak recently, I have new menus that are virtually complete and ready to be direct mailed to homes. I have new magnets in the works as well as some door hangers.

What suggestions do other pizzeria owners have as to ways to combat the new pizzeria’s grand opening? Coming from the highway they’ll have to pass me to get to them. Maybe get some extra signage for next week and hope to piggyback off of any of their grand opening advertising? I’m sure plenty of people would turn to us if they were looking for the new pizzeria and they see plenty of pizza signs outside our shop.

Any ideas on ways to combat the new shop opening besides the obvious, like continue to serve our excellent product with top notch customer service?

I don’t know your menu but this might have been a good time to introduce a new menu item. If you can still fit a new item on your menu. Have you tried ice cream before? I imagine that would go well in Florida. Salads are also a great addition. Here in PA we sell a lot of chicken salads. We bake fresh chicken tenders seasoned with bbq seasoning. Hold them in a steamer and then cut them into pieces are put them on a salad mix. Add some pizza cheese and a breadstick and of course dressing.

We had a subway open about a mile away a few years back and that took about 50% of our sub business. We went from 500 subs a week down to 250. We got it all back by adding salads, some desserts, and adding 5 new subs to our menu.

New businesses opening with fanfare are going to get people in to try them out. It is natural for people to be curious. Trying to fight that is just shouting in the wind. You might be able to blunt the new store grand opening campaign somewhat, but their efforts will blunt yours as well making it a poor return on marketing dollars spent.

I would not go head to head with the grand opening. I would wait a month or two and then launch a campaign and give people a reason to try you out… new menu items, advertising in new places that will attract first time customers etc. You will have more impact in a less noisy environment.

We do have a new menu item set to debut once the new menus are printed. We’re adding something called “Super Hero’s”. It’s modeled after this successful shop that’s about 20-30 minutes away called Munchies 420. They were on that show “Man vs Food” with Adam Richman. The sandwiches are basically a bunch of appetizer type food in a sandwich. For instance, one of our sandwiches will be chicken tenders, mozz stix, bacon and BBQ sauce on a 12" hero.

I also just learned that a restaurant a couple 100 feet away from us, Friendly’s just closed down. We’ve had a few extra people in here for lunch today because they went there and they were closed. I should probably put some signs up right around their shop to try and get the people who go there and find out they are closed.

My biggest issue of this entire ordeal is the uncertainty of how things will play out?

Should I expect to lose 5% in sales? 10%? 20%? More?

Will it hit me hard the first week and get better or will I not feel it at the beginning and then it’ll get worse?

With domino’s, it hit hard immediately, and then after about 4 weeks of small drops, we began to recover. I have a feeling this one may not hit hard at the beginning, but as more people find out a new shop is open, it may get progressively worse until it finds it’s leveling point.

NYFL you cannot manage your business based on the business plan of another business. Will you feel a loss of some % since this is a direct competitor? Yes! What can you do? Worry, stress, fire a delivery driver ( :stuck_out_tongue: ), or the best thing… work on your business not theirs! I would sit out the first month and see what unfolds. Make sure in that time your process is 110%. Service is great. Food going out is the best it can be! Then, if need be…combat the new place and go from there. The thing not too do is drive yourself crazy over a new venture. Remember how many restaurants fail. It is a hard world to make it in. Do yourself the favor and step back, take a breathe, and also remember you are still around. Something is working. I know things take time. Months, years, decades, but all in time. Hang in there and pace yourself for the race. It’s not fun all the time but if you work for it your time will come.

Remember, you are the already successful business, with the loyal customer base. He is starting from 0, hoping someday to get to your position.

Play from your position of strength. As qcfmike says, take these 30 days to make sure everything is in tiptop shape. Part of every business is new competitors.

Also remember, as nice as it all looks from the outside, we all know he probably isn’t making any money for a while. He’s WAY more worried how this whole thing will work out, than you.

You have homefield advantage. Show your customers your confidence, its what your customers want to see in their favorite pizza guy.

Good Luck.
PS… don’t be surprised if your business actually increases… that has happened to me twice. I think its because interest in the new place, reminds people about how they haven’t seen you in a while.

Okay, so for instance, I just had 25,000 menus printed.

Do I begin the direct mailers now or should I wait a bit to see how things progress with their opening?

It seems that the response is to go ahead with “business as usual”. I just feel that if I don’t assess the situation of a new competitor and then adapt my strategies to what would be optimal under current circumstances then I’m not doing what’s in the best interest of the pizzeria’s success.

  1. Stop obsessing about this and run your own business.
  2. Wait a month after they open before doing your mailer. It will be less noisy and you have a shot to both recapture any of your customers that tried them out AND a shot that ones that had a poor experience with the newcomer.

In quite a few years in this business, I can tell you that new places mess up a lot. Be ready with your best product, smooth service and a clear message focused on what makes you different.

This is not a price game, it is about differentiation. If your market is big enough for a number of players, focus on doing what you do and telling people about that… NOT about responding to the other guy.

This.

You can hit him when his honeymoon period starts settling in.

When we opened Dominos had staff holding boards all over the place, with deals etc. It seemed to spur people to come to us. In fact we always do better when dominos have this drive, I wish they would do it more often.

I say just work your mailing list once theirfanfare period has died down, you can’t beat a brand new place opening, its too interesting. But remind people how good you are and concentrate on your business.

Last year we had a franchise open up 100mts from us but we had a marketing strategy in place well before they opened. I spent time going to the shop during build and fit out asking the contractors when it was opening. I also scoured the employment adds and saw when they were closing off applications and worked out when they would be opening. We went for the Monday but they opened onthe Friday before.
None the less we had a FREE PIZZA offer leaflet (for the first 150 people) go out in the local paper the day before they opened for the offer on the Tuesday (the day after we thought they were opening).
We open at 5pm and at 4pm we had a line outside that required us to put up “nighclub barriers” to keep the line in order.
The night ended up being our biggest ever Tuesday and cruellled the franchises opening impact.
What we had already organised was each of the surrounding 5 suburbs would get 200 random “Free Large Pizza” offer letters delivered by the postman. A suburb was posted at 2 weekly intervals so we had a flow on for 10 weeks plus the late comers in the following weeks.
We picked up heaps of new customers and over 75% became regulars.
The franchise to this day has never reached the sales projections and have shed over half of their staff levels and are struggling to make money.
Getting your pizzas into the mouths of potential customers is the best form of marketing, provided you have a great product, so that they come back as regular paying customers.
For mine I would drop everything and get a FREE PIZZA offer going out as a matter of urgency. Some will come for the freebie and never to return but if your product is good they will come back and even with the freebie others will order additional pizzas or sides when ordereding the free one.

dave