New member intro, Start-up business

[GotRocks]

I do not live in the “middle” of nowhere, just closer to the middle instead of the edge of it. I can see the exact middle of nowhere when I look out my window though!!

Anyways, I am in the planning stages of opening a pizza shop up here. I am not some retired doctor or lawyer that wants to make a small fortune out of their large fortune by opening a restaurant with no previous experience.
I have a few decades of restaurant work under my belt, and I currently operate my own fairly successful catering business. Our full-time resident population is about 5K, but that triples during the summer vacation months, and we have a strong winter with snowmobile’s, hunters, and ice-fisherman. The bulk of the income is made in May through September, then it tails off/

I have a few years of pizza experience, I opened a few different places for friends and stayed on for a year as part of the agreement and their shops exceeded expectations and they met their initial exit strategy goals as planned. My problem is that it has been nearly 20 years since I have done anything with Pizza. I need some refresher time to get up to speed gain.

The plans are to go with a solid-fuel brick oven with gas back-up, I am really liking the woodstone ovens with their infrared deck heaters, gas burners and wood-fired combo’s. I plan on using a sheeter and offering both traditional American Pizza, and some heath-conscience options.

I am assembling my business plan right now, and it is looking like I am going to need $65k-$70K for start up to gather equipment and rehab the store. I am writing my proposed menu and trying to figure my food-cost percentages.
My question, what are you guys setting your projected food-cost ratio at, and what are you seeing for an actual foodcost.
Some of my menu items will be a little odd to some, for instance I plan a prosciutto & artichoke heart pie, Genoa & Gorgonzola, Fresh Mozz & basil just to name a few, But I will still be offering the classic sausage pep, shroom, Olive pies.
I am a little befuddled on proper pay rates for kitchen help too,

Sorry for the yammering and not staying on topic, but that should be a clue as to rough this planning has been on me. Can you guys help point me in the right direction to gather resources and learn more to get up to speed with current production techniques.

Thanks
GotRocks

 

[pizzafanatic]

Sounds like you’re going the gourmet route and that’s cool if your clientele desires that. If they’re willing to pay higher prices, I’m sure sub 25% food cost is possible. But that’s going to require good portion controls and inventory management. A lot of your toppings are perishable and do not have long shelf lives. If you end up wasting much, you’re FC% will skyrocket.
I try to run around 30% FC and have very tight controls on portioning and inventory. My menu pricing is probably 20% higher than the chains for obvious reasons.
As for pay rates, see what other restaurants in the area are paying for entry level kitchen help. If unemployment is high in your area, you’ll probably be able to find some pretty good help for less money. And vice-versa.

 

[GotRocks]

Thanks for your reply pizzafanatic,

a 30% cost ratio? that seems high to me, (meaning too low of a profit) I costed out the ingredients for 8" , 12" & 16" pies with traditional toppings and at a 20% cost-ratio I am still cheaper than the 2 other non-chain restaurants in my area. So I am shooting for a 15%-18% cost ratio for the traditional and the gourmet pies.

My only real competitor in the area is currently charging $14.00 for a 15" cheese pizza, with additional toppings listed as $1.75 each (this includes both vegetables and meat toppings at the same price) so he would be getting $22.75 for a saus,pep,mush,onion,B-O pizza! figure the raw dough weight at 18 ounces, 10 fluid ounces of sauce, slightly less than 1 pound of cheese, 10-12 ounces of sausage, $0.05 worth of onions, and about 50 cents each on olives & shrooms.
off the top of my head, i see their total cost of that pie well under $3.00 cost lets say $2.89 to make the math interesting.
My calculations show his cost-ratio at about 12%-13%, and they are doing 200 pies a night in our torist season, slow dead nights in the winter they are still putting out 25-30 pies on weeknights, and weekends they see about 100. and their quality is mediocre at best.

I am planning on offering traditional pies, I just want to have gourmet selections due to the change in eating habits that is taking place up here. Heck, We even have a Sushi place now!!

Yup! Northern Wisconsin tourist area that is focused on hunting, fishing, and snowmobiling has a viable sushi place doing well in a town of slightly over 5K permanent residents. Our population triples in the summer, and we also see a typical head count of nearly 50K people with the hotel resort business.
Check us out here http://www.minocqua.org

Labor-cost percentage;
We either have no-talent hacks calling themselves cooks, or we have semi-talented cooks whose current employers will do anything they can to keep them because they realize there are so few capable cooks out there. I am trying to idiot-proof pizza prep to keep portioning and consistency in product as tight as I can. Instead of shredded cheese, I plan to use sliced LMPS mozz on the traditionals, and the gourmet pies will have choices such as a smoked Gouda to go with the Q-Chix and pulled-pork offerings,

Maybe I should mention that I will be doing BBQ at the store too, I’ll be cooking BBQ with wood in a semi-open kitchen with it viewable from both inside & outside the restaurant with either a “Southern Pride” Or Oyler 700" BBQ pit, and the pizza oven will be operating in the dining room. pies will be made & prepped in full view of all the customers with a spectator area off to the side so the service area stays clear. I plan on having a tip-jar or tip-splitting process for the pizza cook as an incentive.

 

[pizza2007]

they are doing 200 pies a night in our tourist season

pizza oven will be operating in the dining room???

Whoa… I’d recommend you rethink having a dining room in your kitchen. Doing 50 pies an hour ain’t easy for rookies, much less if customers get in your way.

 

[piemaker2007]

when I was a supervisor for Pizza Hut the store I was in averaged about 22% food cost each week. The acceptable range was 20% - 25%, lower or higher than that range would send off flags to upper management. If it was consisently lower they would look at your portion control to see if you were skimping on the product making the product inconsistent. They would also look at inventory controls and the stores ordering levels. If nothing was found then the store got special recognition and other “atta boys”.
If it was consisently higher then they came in with a fine tooth comb to look at your operation (inventory, ordering, portion control, waste, etc) to find out why. People could start losing their jobs depending on what was found.

Portion control, waste management, and consistency will be your friends. The more defined your process is the better your FC will be. Stanardization will also allow you to have less experienced cooks turn out consistent product. Weight scales were extremely helpful for most products including shredded cheese.

Bryan

 

[GotRocks]

Yes, the brick-oven will be in the dining room, as will the prep-coolers and other pizza-related equipment. It is an open-kitchen concept restaurant. There will be a service-only area, and a spectator area for the customers to watch their pies being assembled, baked (for the entire 90-120 secong cook time) then panned & cut for service. the oven tender should be able to produce 100 pies per hour with this proposed set-up.
Pizza making is going to be a spectator sport in my place. Not something to be hidden behind walls. Why have a wood-fired brick oven if it is only going to be hidden. That makes as much sense to me as hiding a fireplace. (no offense)

PieMaker, thanks for your input, I was not aware that the hut actually set the ratio between 20%-25%, that seems very common to me for most any pizza place I have had pizza from when you see the amounts of ingredients and knowing what these items cost. I knew I was in the ballpark.