Advice for Noob. I Dare You to Burst my Bubble

[Benedetto]

I am feeling a burning urge to open a pizzeria, and I wondered if I could get a little advice.

I live in South Florida. The pizza here is an abomination. This is especially true of NY street-type pizza, which is the kind I like to make. It seems like every pizzeria that makes a good pie succeeds here, because people are so desperate for good pizza.

I make excellent thin pizza and incredible Sicilian. I started at home, but now I’m making Sicilians for my church’s cafe. My method is fast and easy, and I don’t need anything fancier than a deck oven. It costs me a little under $3.00 to make a 12" by 9" Sicilian without toppings. A 14" thin pizza is less, because the cheese is thinner. People are happy to fork over $2.50 for a 4" by 4.5" slice. They keep coming up to me to tell me it’s the greatest pizza they’ve ever had, so I think the product is ready for the market.

Pizzerias are going broke down here, left and right. I think it’s usually because they stink, although I’m sure undercapitalization and other problems pop up. They tend to use fake cheese and so on. I keep seeing places I can buy for anywhere from $75,000 down to $0 (probably a landlord who kept a tenant’s equipment).

My first question: am I right to think quality will bring customers? I have no doubts at all about my ability to make the product, and I know it’s in short supply down here. But I wonder if I’m too optimistic about good food bringing business.

Second thing: can anyone direct me to a simple list of stuff I should have on hand to start the business? I know I’ll forget something. I only plan to sell pizza, rolls, soft drinks, and cheesecake made from scratch.

Third question: if I can buy a place for the kind of money I’ve mentioned, is there any point in simply renting a space and starting from scratch? The nice thing about that approach is that I could choose my own location instead of waiting for an opportunity in an area I like.

My plan is this: offer thin and Sicilian pizzas, in one size each. Slices, too, plus garlic rolls. Apart from that, I only want to make one product: cheesecake. No one in this county makes an edible cheesecake, and my recipe is fantastic. I don’t want to sell alcohol because of the headaches. Just soft drinks. I want a sharply limited menu, to keep life simple. It has worked for other pizzerias I’ve seen.

I have enough money to buy a business and keep it going for months, so I won’t have debt at first. My main concern is my ability to attract customers.

Will good pizza publicize itself, or is this just another commodity business?

 

[Pakula_s_Pizza]

I usually tell anyone in your position run but honestly if you can get into a place for 0 down do it. Obviously you want to and it sounds like you already have done your research and development. There is alot to learn but if you could risk 10,000-20,000 ( fees, insurance, inventory, marketing, cashflow, etc.) People fail for a variety of reasons most of them are not location. Keep asking questions on this forum, this is the best resource for pizza shop owners on the internet. Good Luck

 

[Benedetto]

Thanks for the reply. Why do you usually tell people to run?

You say most reasons for failure “are not location.” That interests me, because the two most successful places near me have awful locations, and the cash registers never stop ringing. After watching these places, I got the impression that quality pizza is so attractive to customers, they’ll go just about anywhere to get it. Is that more or less right? I don’t want to go into this with an unrealistic understanding of the business.

I wouldn’t say I “want” to do it, but things keep lining up in a way that makes it seem inevitable, and if there’s a fair chance of success, I feel like I should go ahead and put the wheels in motion.

 

[Wizzle_Wassell]

ok here goes with the questions:

Benedetto:

I live in South Florida. The pizza here is an abomination. This is especially true of NY street-type pizza, which is the kind I like to make. It seems like every pizzeria that makes a good pie succeeds here, because people are so desperate for good pizza.

If you look a few recent posters have also made the same comments and plan to open in Florida. There is good and bad pizza everywhere. The problem is finding what CUSTOMERS think is good, it may be the best made pie, it may be the cheapest it may be a combination of all of this. It may be the best advertised, (Its hard to buy pizza from a shop you’ve never heard of) etc etc etc

Benedetto:

Pizzerias are going broke down here, left and right. I think it’s usually because they stink, although I’m sure undercapitalization and other problems pop up. They tend to use fake cheese and so on. I keep seeing places I can buy for anywhere from $75,000 down to $0 (probably a landlord who kept a tenant’s equipment).

They’re going broke everywhere not just in Florida and not just the ones that make ‘bad pies’. Undercapitalization is a key problem for many businesses (not just pizza) and particularly at the current time. Remember that just becuase a shop was a pizza shop doesn’t mean it can then open up again without complying with the then current local codes so you’ll almost certainly have to spend some money getting it up to date.

Benedetto:

My first question: am I right to think quality will bring customers? I have no doubts at all about my ability to make the product, and I know it’s in short supply down here. But I wonder if I’m too optimistic about good food bringing business.

Nope, advertising and marketing bring customers. Have a look at a few recent posts, getting people though the door is a skill and takes a lot of work. I’ve had my shops for 3 and 5 years and I still get people who didn’t know we had opened our 2nd shop (3 years and a lot of marketing material later). And as I mentioned before ‘quality’ isn’t always what people want. Look at LC’s hot and ready $5 pies or the plethora of $10 specials at the moment - quality or value?

Benedetto:

Second thing: can anyone direct me to a simple list of stuff I should have on hand to start the business? I know I’ll forget something. I only plan to sell pizza, rolls, soft drinks, and cheesecake made from scratch.

Have a look at the FAQ section at the top of this page its got loads of stuff.

Benedetto:

Third question: if I can buy a place for the kind of money I’ve mentioned, is there any point in simply renting a space and starting from scratch? The nice thing about that approach is that I could choose my own location instead of waiting for an opportunity in an area I like.

Well thats the million dollar question, only you can decide on location versus shop set up.

Benedetto:

I have enough money to buy a business and keep it going for months, so I won’t have debt at first. My main concern is my ability to attract customers.

Months?? is that 2,3, 6 or 12. You may be lucky and be able to draw money straight away (ok unlikely) or it may take a year or 2. As you say undercapitalization is a killer for many businesses.

Benedetto:

Will good pizza publicize itself, or is this just another commodity business?

As above - nothing publicizes itself you need to help it along and whose to say its good!

Making a few pies in a home kitchen or for a local group is a far cry from working in a commercial food business. Its NOT just about making pies, its about marketing, advertising, cost control, inventory planning, Employee management (and all the hassles that go with that barrel of laughs!). Its long hours, hard work and it ain’t for everyone. Have you ever worked in a pizzeria?

I hope I put some helpful comments.

 

[Benedetto]

I would say “yes” to the question about having worked in a pizzeria, but it was just Domino’s.

That’s actually pretty similar to what I’d like to do, except that I’d make my own dough and cheesecake, and I’d like to sell slices in order to avoid the problems the big chains are having, competing with cheap burgers.

 

[Napoli_Pizza]

We obviously get this question alot. But I would say this…
I believe your excellent quality pizza should not be viewed as your advantage over others…
It is simply your admission to play the game…

If you want to play the pizza game, you need great pizza (which can mean a variety of things as others have said), great customer service, a decent location, great marketing, great mananagement, and probably about $100 - $150k.
Now you still don’t have what you need to win, you only have what you need to compete.
To win, you need to put in the time. That may mean working in the business like many of us, or working on the business like Bodegahwy. Either way, competing consistantly over time will determine your success.

The common mistake many noobs make is looking at other operations, and when you don’t understand why they do something the way they do, assuming they are stupid. Take one more look at your competing operations, try to understand the logic behind their operations…maybe even post here and ask why someone who do that stupid thing.

 

[Benedetto]

The only stupid thing I know of that the places here in Miami do is the production of really bad pizza. Everyone here complains about it.

We have a local chain called Cozzoli’s. They have a location about a mile from me. It goes out of business over and over. Every time it reopens with a new franchisee, I go in to see if anything has changed. I love pizza, and if their food was even tolerable, I’d go once in a while, because it’s close. But they keep blowing it, using something that may or may not be cheese, with sauce that appears to contain virtually no seasonings.

A place called Riviera Pizza opened near me. The crust was fine. The sauce was okay. But the cheese fell apart in your mouth, like it was made from wax and corn meal. I don’t think it was even cheese. In spite of that, I went to this place a number of times, because the nearest decent slice was fifteen minutes away. Naturally, they closed up.

There are three places near me that do good business. One is “Miami’s Best.” The pizza is pretty good, but they screw up constantly, burning pies and getting the ingredients wrong, and when you tell the owner you’re not happy, he takes up for the employees. Another busy place is The Big Cheese. The pizza is good but not great, and half the time you can’t park, but the service is good, and you never get a surprise when you open the box. The third place is Casola’s. Very good pizza. They have a bank of several cash registers, and the place seems to hum all day long, even though it’s a royal pain to get to the restaurant and park.

If I want to get decent pizza, I have to take my chances at Miami’s Best and get a B-minus pie with muenster cheese on it, or I can drive a long way to one of the other places. About once a year, I go crazy and order a Papa John’s, and I regret it. I would order from Domino’s, but the food is so bad now, I just can’t stand it. This is why I learned to make my own pizza. I had to.

The only common thread I’ve noticed among the successful places is that they serve good food. I’ve only seen one place that served good pizza fail. This is why I thought good pizza was such a big edge. But if it’s not, it’s not. It’s good to hear the truth from people who actually know.

 

[aj453]

I am not sure of the work force in south florida. But if you plan on opening a deck oven pizzeria and the workforce that knows how to use them is limited, Be prepared for mistakes. I am kansas. I use both a deck oven and conveyor. Most people have never seen a deck oven, let alone used one. Staffing is impossible. Yes, you can train, but it takes time.

 

[Benedetto]

I’ve never used a conveyor. Back when I worked at Domino’s, we used deck ovens. We shoved the pies in, poked holes in the dough bubbles that formed, and turned the pies once. That’s all I remember.

I believe a partner and I would be the workforce initially. Staffing problems would be a few weeks off. Down here, anyone who has a green card and speaks English is a find. This is really the only part of the business I don’t look forward to.

Is it easy to make decent pizza with a conveyor? The only conveyor pizza I’ve knowingly eaten, other than pan pizza, is Papa John’s, and they have a very poor quality crust.

 

[Pakula_s_Pizza]

WhaT I meant by I’d tell you to run-

My last two months.
We do a half a million dollar a year throu a delco. Some seating not our bread and butter. We took over a great location that had 5 owners in 4 years. Crazy? Yes. Mind you I was 22 w a culinary degree and 6 years in a pizza place. 3 different ones( never got fired, just moved.)
we spent 120k to open. Somebody was watching over me, the econonmy crashed hours after we opened(2/12 years ago). Great story?of course. Now to the fun part. My walkin box has gone down two times in two years. Ive lost inventory in my pizza prep table twice even though I bought a new one before we opened. I have made improvements every month from equiptment( new salad prep area, cold case for meat pizza- health dept busting balls) to signage. Every day is a ride. No show employees, companies trying to change pricing, leaks, breaks, cracks, idiots, headaches, sleepless nightS, unpaid personal bills cause a succesful business pays there bills. It never ends. After buying a new stove I need a prep table. Don’t forget about the plumber and hvac guy you need to come in to hook em up.

This is not organized they are just thoughts. I’m on my iPhone so I apologize if some words don’t belong.

 

[pizza_garden]

I’ll echo the sentiment that getting into a place with no money makes it very attractive; however, having only “months” of operating capital makes it unlikely you’ll succeed. Maybe the answer is “it depends.”

It depends on you or your partner having solid marketing experience because great products or food do not guarantee success. You think McDonald’s and Microsoft are successful from delicious food and great products?

My opinion is delco pizza is a marketing and advertising business, with some cooking.

All of us started somehow, so good luck. Finding resources to fill your shortcomings is in the job description for being an owner.

 

[Benedetto]

Pakula:

If you don’t mind my asking, are you doing okay now? I would hope that with your gross sales, you’d be in the black at this point.

Pizza_Garden:

The joint that’s selling for nothing was just an illustration of the range in prices down here. I would not want to take it, because I want to move north of Miami, and that business is down near the Keys, in Homestead. Maybe that makes me crazy, but I’ve had enough of the Miami area.

Miami is a funny place. Sooner or later, most people want to be somewhere else.

I’m hoping I can develop a following at my church, so people from the neighborhood who are not churchgoers will start going there to eat. That could make the church some money. Unfortunately, if that helped me at all with launching a new place, it would only establish my reputation in the church’s neighborhood, which is not very affluent.

Even if I can’t start my own place, I think the church’s cafe is going to do well. A real buzz is developing, surrounding my pizza. We have over 4,000 weekly attendees between Saturday and Tuesday, and the upper floor of the building contains a number of businesses.

 

[pizza2007]

What’s the easiest way to have $100,000.00 in the restaurant business?

Start out with $300,000.00

Spend some time reading PMQ, you’ll find its anything but easy. Couple that with today’s economy, and it’ll be quite the task.

Good luck!!

 

[wa_dave]

pizza2007:

What’s the easiest way to have $100,000.00 in the restaurant business?

Start out with $300,000.00

And that is only after 3 months

 

[pizzafanatic]

Besides PMQ which is awesome for mindshare, you really should (if you could) go to the Pizza Expo in Vegas next week (or one of the other pizza shows). I did before I opened and it was worth every penny. They have seminars and workshops every day, plus the expo has just about everything you’ll need to open your place. There’s a pre-show workshop by Big Dave Ostrander called “So you want to open a pizzeria”. Big Dave is like the Godfather to this biz. I’ve sat in several of his seminars and he definitely knows his stuff.

Ok, so commercial over…

I agree with all of the previous responses. Making good pizza is the easy part of this biz. You need to do your homework and come up with a solid business plan. When selecting a location, if a previous pizzeria went under there, you need to know why. What’s going to make your operation any different? Don’t just assume it was because they had inferior product.

 

[Benedetto]

It doesn’t sound that tempting now. I thought a quality product would make a difference in this pizza-starved area, but everyone says it won’t help, and it’s the only reason I thought I could do well.

 

[Pakula_s_Pizza]

Benedetto:

It doesn’t sound that tempting now. I thought a quality product would make a difference in this pizza-starved area, but everyone says it won’t help, and it’s the only reason I thought I could do well.

I guess you won’t know till you try?

 

[bodegahwy]

Marketing and location draw customers, quality and service keep them.

 

[Benedetto]

I guess you won’t know till you try?

I know you already know this, but the first rule of investing is “Don’t lose your capital,” so given the pessimism I see here, I’m a bit less excited than I was.

I think I should keep developing the church’s business. If the food draws a following in spite of our horrendous location and highly dubious standard of service, I’ll know a shop is worth a try. Won’t cost me anything, I enjoy it, and the church is already making a little money. And I get to polish my skills. Today a Grande rep is dropping samples at my house. Can’t wait to try it out.

The big bummer about cooking in a church–even a big one like ours–is that you can’t get professional behavior out of the volunteer staff, so we end up serving warm cans of Coke, taking forever to check people out, and failing to time pie production correctly. On the up side, the management is less concerned about making money than they are about not losing too much.

 

[Wizzle_Wassell]

Benedetto:

It doesn’t sound that tempting now. I thought a quality product would make a difference in this pizza-starved area, but everyone says it won’t help, and it’s the only reason I thought I could do well.

I don’t think there is ‘pessimism’ we’re just trying to make some pertinent points to you. You have stated (and continue to do so) that you see PIE QUALITY (what every that actually is) as THE key driver and to you it is the key reason why businesses succeed or fail - even when we pointed this out that it wasn’t, you’ve posted a similar comment in this and another thread!

Quality is ONE of many reasons a business can succeed. Lets go to basics.

You may have the best tasting, quality or whatever pie in the world but…

without marketing (enough) people won’t know you’re there
without an appropriate price people not want to pay that much / be able to afford
without a suitable location people can’t park
without good systems people may have to wait too long to collect/get delivery
without reliable equipment you may not have consistent product
without a clean and presentable shop people may perceive you as dirty
without excellent delivery service people may prefer to get a pie quicker from the other shop
without cost control you may go bust
and so on and so on…

Likewise if you had all the above things sorted but had a dreadful pie then you may not succeed as well.

I have a very good quality pie in my market (in my opinion its the best quality). So am I the only successful shop? Nope, because my prices are (relatively) high compared with other and some people don’t want /can’t afford to buy my food. Not everyone thinks it is the best, and (unfortunately) sometimes we don’t get all of the above things right and we lose customers.

Added to this is the whole ‘good pie’ issue. What is ‘good’ to you isn’t good to everyone. If everyone always bought the ‘good product’ then they’d only be one wine, one whiskey, one car etc. A ‘good’ pie is very subjective.

So backing up to your original question. Having a ‘good pie’ does not in anyway by itself create success its just one element in a whole mass of other things. So you’d better consider the ‘other things’ just as much as you are focussed on quality.

Hope this helps!