Hello. I was wondering what you think about this. We own a small pizza shop in a town of 75,000. Within a mile radius of our shop, there are two other indies, a PH, a LC, a Mary’s Pizza Shack, a RT and a new one that’s just opening up - Pizza Guys. That makes 8 pizza shops with in a mile of each other on the main street through town. When is enough enough? How do we stay current and up to date and all that other good stuff with so much competition? I know competition is good, but when does it turn bad? Just spouting off but I’m more concerned now than I have been in the past two years! This year we’ll be celebrating our 5th anniversary. Some thoughts would be nice. Happy 2010!
I am in a similar situation. My area has 13 Pizza shops with in a 2 mile radius. Five of them have full liquor licenses!
Eventually the market will weed out the weaker operations and the numbers will dwindle. Offer thw best product you can and market yourself. Find your identity and put it out there. The market will determine when enough is enough.
It is a hard question… enough? Can the demand for pizza increase if the stores offer different products?
We have as many stores as you mention and more. There are 20 restaurants that serve pizza in my town and eight of them deliver… and our town has 10,000 people. When the tourists are here (like this week) the population is closer to 25,000 or even 30,000. I have never felt that my business was limited by the number of other stores that serve pizza.
On the other hand, Pjs went out of business here and Pizza Hut is closing later this year. My suggestion would be to keep the focus on your business, your product, your service… what makes you different. In a town with 75K people there is plenty of pizza business to thrive. I does not matter so much what the other guys are doing when you are doing your thing well.
In a race with a bear, I do not have to be faster than the bear… I just have to be faster than you.
I have to agree with bodegahwy. Keep the focus of your business. If you have a successful niche continue to exploit that and find out what brings in your customers and enhance it. Don’t feel that you have to compete with everyone else in the market but pick your niche that suits your strengths and ride that pony home 
Bryan
I agree with bodegahwy too. When we took over our shop Fall '08, I felt very nervous about being in an over saturated market and we had a Top 100 chain coming in soon with deep pockets. We have the best pizzas in town though and have about a 25% monthly growth rate at the start of our 2nd year and a very lean, efficient shop. I just quit worrying about what other people were doing, quit trying to battle everyone for the students business that was going to have zero loyalty and found a way to get customers that didn’t mind spending $2-$5 more per order for a better quality.
I’m not growing 25% every month, I worded that poorly. The first few months of our second year have not come in under 25% growth over the previous year.
Indie-
What is the chain store that opened in your area?
The new place is called Pizza Guys. Never heard of them until about 8 months ago when they came looking to see if we wanted to sell our shop. They are now moving in about 4 blocks from us. Looked on their web site. Interesting. Franchise.
Interesting statement - we’re directly across the street from a high school. The new place is down about 2 blocks from the high school in the other direction. Not sure if they’ll be doing slices. We sell about 20 - 18" pizzas as slices to the kids each day. I hope them coming in will won’t change that.
Pizza Ranch, it’s the only one in the state. The killed us for a couple weeks because everyone wanted to try out the new place and then we bounced back with even better sales than before they opened.