While the traditional pizzeria market keeps considerably regular hours, with a certain contingent venturing into late-night hours, a small but growing segment of the industry goes full throttle with 24-hour service. The first step to opening or transitioning to 24-hour business is determining if there are customers to support a revolving operation. Owners must consider competition from other restaurants in the area, how much will it cost to stay open later, labor, operating, security, marketing and insurance costs incurred, and long-term maintenance of a 24-hour business.

For Ben Darwish, owner of Gino’s Pizza and Brew in Orlando, Florida, extending late-night hours to around the clock service was a natural result of observing the buying patterns of local clientele. “We had the late night rush until 4:30 a.m. or 5:00 a.m., and by the time we finished cleaning up it was 6:00 a.m. and we had to reopen at 9:00 a.m., so I figured getting food deliveries at that time would be more convenient, and just to have the logo saying ‘24 hours’, it would be worth it,” he says. There are three 24-hour Gino’s all within close proximity. Two are currently thriving, and while one location took a bit of a hit from the recession, Darwish is optimistic about a quick recovery thanks to a new civic center in the area.

Running a 24-hour location can help establish a unique foothold, especially if there are no other such businesses in the area. When Tristan Koehler extended hours at the Domino’s Pizza near the University of Dayton in Ohio in August of 2010, effectively launching the nation’s first 24-hour Domino’s location, it garnered positive attention for the Domino’s franchisee. “In general, we’re seeing that people are ordering later at night since they don’t have to order before 3 a.m. or 4 a.m.,” says Koehler. “They’re not in a rush now, they call us when they feel like it, and that might be 6 a.m.!”

Darwish finds the 24-hour model financially viable, particularly because of Gino’s monopoly on all-hours pizza in the area. “We get stragglers and a significant amount of business after everyone else closes,” he says. The shift to a 24-hour model allows Gino’s staff to utilize down-time for vendor-pleasing easy, fast shipments and deliveries, and staff has the time for careful inventory during lulls after the late-night shift, and to prepare for needs that might arise later in the evening.

Twenty-four-hour business owners count on a large segment of consumers for revenue — bar and club goers looking for a late-night bite. Darwish estimates that about 90 to 95 percent of his late-night business comes from partiers, and nighttime business accounts for about 65 percent of Gino’s business overall. Cashing in on this great demand, however, incurs its own risks. “Being open past when bars close is going to have a number of challenges,” says Victoria Shuster, a manager at HoundDogs Three Degree Pizza, a popular all-night pizzeria in Columbus, Ohio.

A 24-hour operation will definitely need to have a security plan in place, whether that means training staff to handle rowdy crowds, which works for HoundDogs, or hiring a dedicated security staff, which Darwish does. Safety issues are a valid concern and often trickier to handle when customers are inebriated. “Some of the newer, fast casual restaurants operating on a 24-hour basis have offered discounts to police, fire and medical crews to provide comfort and safety to patrons and also drive traffic,” says James Sinclair of OnSite Consulting.

For businesses still establishing their client base, there is risk of financial loss during the time it takes to build a dedicated clientele for a 24-hour operation. “Demand for 24-hour service may not be there yet,” says Arjun Sen, president and founder of ZenMango, a Denver, Colorado-based marketing consulting firm working with restaurants, retail, charities and other guest experience-driven industries. “Even if it is, the cost of fulfilling that demand may lead to short-term financial loss.” Though these losses may ultimately turn to wins, the time it takes to market, promote and gain trust in a 24-hour pizzeria is definitely an important consideration when researching such an undertaking. “In the first month, we incurred many one-time costs, including giving away 1,800 free pizzas on campus,” says Koehler. 

Staying open around the clock allows for special experimentation that a traditional business can’t provide, such as the rollout of breakfast pizza at the Domino’s in Dayton. While Domino’s reps say there aren’t nationwide plans to open 24-hour locations, Koehler’s success with his model could very well prove to be an inspiration to other business owners. “A 24-hour business definitely profits,” says Shuster. “There’s all kind of people that are out late, and someone wants pizza for breakfast, or they are getting off third shift and they want food that’s not McDonald’s breakfast.”

The 24-hour customers do exist, and their profile varies depending on location, competition, security issues and other factors that are unique to each business. “Fitting in food around a busy lifestyle has opened up a market that is seeing explosive test growth,” says Sinclair. With many fast-food restaurants offering 24-hour service, it’s natural that pizzeria owners will want a share of that business. “The 24-hour restaurant model will be a future industry norm, for a number of reasons,” says Sen. “As geographical boundaries start shrinking, people will be doing more business based on global hours and not local hours. Also, work habits are evolving with more adults working off-site and on flextime hours. Traditional restaurant hours built around traditional business hours will fade as individuals demand access to food at different times.” u

TAKE IT SLOW

Not ready for 24-hour service just yet? Get your feet wet by extending hours on weekends. “Once an operator decides to take the step forward to move to a 24-hour pizzeria, he/she should consider moving forward in steps,” says consultant Arjun Sen. “The journey to 24-hours should not be taken in one giant step, unless the demand justifies it.”

Try staying open later on weekends, and watch how this affects business. Market new hours to customers with a promotional offering, such as specials surrounding holidays, or tied in with events at local establishments such as concert venues and corresponding to activities at local colleges and universities. Moving to 24-hour weekend shifts might be the next logical step.

Lee Erica Elder is a freelance writer in New York City.