Hello from India!!
I would like to hear what your experiences are; selling pizzas only in a single size vs selling 2 or 3 different sizes?
I can see why having a small, medium, large would make the most sense. My dilemma arises from the fact that I started selling only one size, 11" and have been doing so for the past 9 months which is when we started our business (delivering pizzas, no dine in). Certainly there is a market whom I am not catering to as they are looking for a more reasonable product and not such a big pizza because it is more than one person can eat. However I feel that if I start serving an 8" pie, the sales of my 11" pies would drop. Also delivery costs would remain the same and I wonder whether it is worth while to deliver small pizzas. No one charges for delivery here, so that is out of the question.
What I have noticed is by adding side orders like pastas, garlic bread, etc, which we added recently, our revenue has gone up. Maybe this could be a positive indication that multiple options help boost sales.
We have three sizes.
Our best selling size is 16"
Our next best seller is 14"
Our smallest size is 12" and is a slower seller.
I can not imaging offering an 8" pizza and trying to make the math work to deliver it!
Offering sides will certainly help to increase the amount of the bill, thus helping to off-set the delivery cost which you appear to be locked into. Rather than offering a whole different size pizza, do you think that offering your existing pizza as a half portion might work for you in your market? It would certainly make things easier for you as opposed to making another size pizza. The biggest challange to this will be what to do with the other half of the pizza. This might be mittigated to some extent by only offering half portions with the most popular toppings, thus increasing the opportunity to sell the other half as quickly as possible. It would all depend upon your sales pattern. You might even limit the sales of half portions to only specific times (your busiest) to help turn the other half as quickly as possible. Another option might be to offer a smaller size pizza only as a bundled deal. For example, your small size pizza would only be available with one of your side oreders, thus bringing the cost up to roughly the same as one of your regular size pizzas which you are currently delivering. A good idea for a side in this case might be a dessert breadstick order. These are easily made using your regular pizza dough formed into breadsticks, and as soon as they come out of the oven they are brushed with melted butter and sprinkled with a cinnamon-sugar mixture, and served with a small cup of dipping icing (powdered sugar + water + a little vanilla for flavor+ a small amount of the melted butter you used to brush the breadsticks with) you can make this up well in advance and store it in a tightly covered container for a couple of days. This would be similar to the “Dippin’ Sticks” offered by one of the big box chains.
Tom Lehmann/The Dough Doctor
We do not deliver but we have 2 sizes of each style of pizza - Medium and Large (10/14 for Chicago & 12/16 for thin). In three years+ not one person has ever complained about not having a small. I theorize it helps our total revenue to NOT have a small. Can’t tell you how many times someone has asked for a personal sized pizza and ended up with a Medium instead…
Just thinking out loud here…not suggesting. What if you were to increase your current 11" pie to say 12" (let’s now call it a “Large”) at a higher price. Then, offer a 10" (let’s call it our new “Regular”) and offer it at a slightly reduced price from the price of your old 11" pie. First, you would be generating more sales dollars for the Large pies, and second, you would have a smaller product to offer for those that didn’t want that much to eat…but, more importantly, you would have an opportunity to sell 2 Regulars to those that previously might have wanted half with one topping and half with another, or one for the parents and one for the kids. Selling the 2 Regulars would, or course, include marketing them while on the phone, or maybe even offering a 2 Regulars for a reduced price deal. Regardless of how you approach it, there is always enhanced marketing value associated with more customer options…in fact, you may currently even be excluded by some potential customers because you offer only one size.
Thanks for the responses guys.
bodegahwy - We Indians have smaller appetites :lol:, 16" is almost un heard of. Domino’s does some 6 inch pizzas as well! Yes 8" pizza by itself is not feasible for delivery.
I like the suggestion of pairing a smaller pizza with a side order. Dippin sticks do sound tasty! Could also cut my Pizza in half as my dough is par baked and stored, so the other half would not go waste but my pizza would move around in the existing box.
The 10" and 12" idea sounds practical as well, gives customers more choice and me; hopefully more revenue.
pC - What kind of establishment do you run if you don’t mind me asking? Is it a casual diner, fine dining? The reason I ask is because I am looking to perhaps start a second branch and I wonder if making aritisinal pizzas (pizzas will be the same, branding & positioning is different) along with a nice ambience, service & wine is the way to go vs being primarily someone who does delivery. There are restaurants here that charge 2 to 3 times what I charge (my 11" cheese pie is approximately 5$), from a Casual to Fine Dining experience, and we give the same quality as them, sometimes better. Even Domino’s is more expensive than us comparing viz a viz but since this is our first year I want to be competitive and make a name.
Sorry for deviating off topic but I just wanted to know whether I am on the right track with my food & packaging cost. It is between 33-36%.
It is not about appetite. The 16" is not a single serving! I would generally expect that a 16" pizza feeds 4-5 people so it is a family meal. Less food per person than your 11" pizza and a better budget item when feeding a group. You may miss orders for larger groups if they have buy 10 X 11" pizzas (60 slices) to feed a party rather than 5 X 16" pizzas (also 60 slices).
We sell a LOT of pizzas to families, kids sports teams, birthday parties, workplaces etc because pizza is a pretty inexpensive way to feed people. Doing so with large pizzas is what makes it possible to get the pricing low for the customer and still profitable for the business.
As a consumer, I think options are great.
If you have a POS system you should be able to track order frequency for the various size pizzas that you offer. With this information, you can make sound business decisions based on actual data.
The most important thing is to find your star products (most profitable) and determine how to increase volume and order frequency of these products. If a “personal pizza” has better margins than a Large 3-Topping, then by all means, look at ways to sell more of them.
At the end of the day, it’s better to make $5 profit on small pizza than $3 profit on a large pizza.
Types of Customers:
Which segment makes up the the largest majority of your customer base? What do they order most often?
Start with the data you have available, and go from there.
All the best,
You have asked for ideas to include in a second shop that will have table service. My first thought is that we have concepts that work for us, but you are in India and should probably decide how to embrace Indian culture into your concept. While pizza and beer, peanut butter and jelly and hot dogs with mustard are great concepts here, they may not be as successful there. Flat screen TV’s and juke boxes are winners in most pizzerias here, but that could be a catastrophic (spelling?) mix in Indian culture.
Take some time to see some of the pizzerias that are deemed winners (do you have Yelp in India?)…actually visit them (maybe even an overnight trip to a nearby city that has several winner pizzerias), see what is working, see what is poorly structured, check out their pricing models and read Yelp reviews (they will tell you exactly what it is that their customers like and dislike). There is no secret to being a winner…offer a great product, great service, reasonable (not too cheap) prices and a clean and pleasant environment to sit and have a slice or two and you will do just fine. Good luck.
When I want a small pizza I do not go to my 1st choice of pizzerias because they do not offer a small pizza…So I just go to go to Walmart and get a frozen one…I can not remember the last time I told the pizza shop owner I did not go there because he does not sell the size I am looking for…I suspect most folks just go elsewhere and you never know about their activities…
I am going to put some numbers to this question. I have four sizes of pizzas and the breakdown is as follows:[list]14" = 47% by count … 57% of sales dollars
12" = 25% by count … 24% by sales dollars
10" = 18% by count … 15% by sales dollars
8" = 10% by count … 4% by sales dollars[/list]
When determining the menu pricing for the pizzas I have each size with a different ideal food cost percentage, for example an 8’ might have a food cost of 24% and each size step would change by 0.5% so 10" would be 24.5% and so on. This gives the customer the best deal by purchasing the largest pizza.
I have also found the number of basic cheese pizzas is very high with the 8" as it is good for the kids who won’t eat much and don’t like all the toppings the adults do.
Daddio… with that trend of sales and size I would find it impossible to resist trying the next size up to see if the trend continued!!