Profit from America’s Love Affair with Pizza

Profit from America’s Love Affair with Pizza

Take advantage of America’s $34 billion love affair with pizza.

America’s love affair with pizza is hard to miss. Drive along any shopping area in the United States and you’re sure to pass a few pizza establishments.

This passion for pizza has created a sizable opportunity for franchising as Julian Angelone, co-founder of Ronzio Pizza, discovered in 1987. Based in Lincoln, R.I., Ronzio Pizza is still regionally focused, with 25 stores in Rhode Island and Massachusetts.

Pizza is a $34 billion market, and there are roughly 150 well-known pizza names as well as many regional and local franchises.

The Company

Service

Thin-crust pizza with a difference—top-quality ingredients and dough made in the store every day. Most stores do more delivery and takeout than sit-down business.

Training

All new franchisees work for a minimum of two weeks in an existing store, where they learn how to run the business. Then Ronzio will send trainers to help out during the first week in business. That might also include other franchisees who come to provide support and backup.

“We can teach almost everybody to make a pizza,” says Angelone. “But franchisees fail if they don’t manage their time or their people well.”

Immigrant-friendly policies

The extensive training, both in and out of the store, helps new franchisees get up and running quickly. As many as half of all franchisees are immigrants from Morocco, Armenia, and other countries.

Funding

The company doesn’t provide any help with funding. (For information on raising funds, click here.)

Franchising

Ronzio helps franchises find their locations, which are usually leased. You’ll need refrigeration equipment, a high-speed conveyor oven, tables for preparing pizza, and a software system with which you can build a database of customer information. You’ll also have to get ingredients. Ronzio uses a third-party distributor that sells private-label cheese, flour, and so on.

“Make sure the franchise can provide the level of support you think you’ll need.”

Startup costs

Total price tag is $130,000 to $207,500. This includes equipment, the build-out of a new store, working capital, pizza ingredients, and a $15,000 franchise fee. There’s also a regional advertising fund that’s 2% of sales; most franchisees spend another 2% for local publicity. The ongoing royalty is a weekly payment of 4% of sales.

Return on Investment

“We never give anyone a guarantee,” says Angelone. But you can probably make 10% to 15% in profits “if you’re operating the store properly.”

Tips for the Immigrant Buyer

Talk to as many franchisees as you can, advises Angelone. And don’t stick to Ronzio franchisees—or even just those in the pizza business. “You can’t form your decision in a vacuum,” he says. Also, make sure the franchise can provide the level of support you think you’ll need.

As for Ronzio, it’s best suited for people who are fluent in English: A lot of customer communication is over the phone. In addition, those with previous experience in retail will be one step ahead. “It can be kind of a shock to somebody who hasn’t had much exposure to this kind of environment,” says Angelone. “You’re face to face with the customer, and you really have to like that. You need to be a people person in this business.”

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