Since November our sales have increased on a steady rate. In the 22 weeks since the start of 2007 our sales are up 16% and for the 9 weeks of the current quarter are up 26% (and growing each week).
We are now seeing a steady response from our New Movers promotion, with 75% ordering extra to the free Family size (15") pizza we are giving away free. The redemption from this promotion will increase steadily with new initiatives for new home buyers in our latest State budgets.
Last week we missed doing $10K for the week for the first time by $43.70 and this week we look like going well over the mark. I’m not at the shop tonight but dropped in a couple hours ago and they were pumping and were not far from the sales target.
All sounds great doesn’t it?
Problems with this success are as follows;
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We are really under the pump on Friday and Saturady (and getting that way on Sundays for the last 4 -5 weeks) for about two and a half hours per night with orders backing up. We have problems getting the pizzas through quick enough with orders up to 30 - 40 minutes before customers get them. We are quoting this and they are more than willing to wait but I hate it. We have a single MM PS360 set at 7 minutes - speeding up the time is not an option as we have a premium product going through at the current speed and do not want to jeopardise it.
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Our lease expires in 10 months and we “should” get a 5 year renewal (our landlord doesn’t do multiples - 5 x 5 x 5 - as it is a major shopping centre). We have asked for an immediate new 5 year lease so we can invest in more equipment - additional oven, more freezer storage, POS, and an new more efficient make line bench.
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We have built a strong brand with minimal advertising mainly using box toppers (thanks to you guys) with some good effective cheap (for us) deals and having a fantastic high quality rproduct which brings in new customers from referals (yah for word of mouth advertising). Our success is currently becoming our own worst enemy. We are priced at the upper end.
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Staffing is a real problem due to 3% unemployment in Western Australia and unbelievable wages being earned due to a red hot mining industry. We have the highest wages in Australia and one of the highest in the world at this time. Problem is nobody wants to work for the rates that are paid in the hospitality trade. Many restaurants and other food and liquor outlets have cut back opening times due to shortage of staff. One hotel (tavern) near us won the best restaurant in a pub/tavern this year for the whole of Australia but have had to close it down as they can only get 3 chefs when they need 14.
We are in need of more staff very shortly but we can’t even get 1 response from adverts. We need drivers (currently have 5 but need at least two more), an additional cook plus a dishwasher/cleaner but can’t get any despite paying the best rates around plus incentives and other benefits. -
The staff we have are great down to each and every one of them and are happy working with us. To keep them we are increasing their hourly rates and telling them it is in appreciation for their great efforts and work ethics. My manager and manager in training will commence incentive programmes as from 1st July which will put their potential earnings up around 20% more than what they are currently getting, making them some of the highest paid in the industry. This and the staff increases will increase our wages bill but increased sales will cover this - but refer back to points 1, 2, 3 and 4.
Until we get our new lease we can’t take the risk in outlaying for the new equipment. There are no equivalent empty shops around where we could re-locate if we couldn’t get a new lease ( centre management see no reason why we won’t get a new lease as the business is increasing, it is a strong business for the centre and we are good tenants) but until I get it in black and white we can’t afford the risk of outlaying around $40K + for the equipment and upgrade.
It is a real dilema with a booming growing business, need of more equipment, lack of secure long term tenure and shortage of future staff.
At the moment we are facing the reality of growing too fast for what we can accomplish at this time. I can envisage hitting $12k - $13K per week withing 4 months and going even higher by this time next year.
And on top of this we are only open from 5pm daily, 364 days of the year and haven’t started day trading yet (the demand is there for it).
By the end of the year we will have around an additional 1,000 houses withing a mile of the store and we are the closest pizza shop to them by about 2 miles so potential is huge. Theoretically we could be looking at $16 - $18K by this time next year.
In the meantime the dilema is how do we manage the sales with what we have and manage to keep customers happy for the long haul. The last thing I want is to start losing customers due to waiting too long for orders, even though some say they don’t mind waiting because they want a good pizza. Our main competition is Domino’s and PH both about 1 and a half miles away.
Domino’s have commenced roadside banner shaking outside our store on Tuesdays for their $5.95 large pizza (but our sales continue to grow).
Any thoughts or ideas would be appreciated.
Dave
wanna switch places 
