2010 March: Slice it Up

Pizza by the slice is big business for many pizzerias across the nation. According to the National Association of Pizzeria Operators, the average American eats 46 slices of pizza per year. But handling slices is different than simply tossing a pie in a box.

Many by-the-slice operations either prepare the pizza in advance for reheating during the rush, or they start with a prepared cheese pizza base and add toppings to order.

“If it’s a very busy slice business location, then I would say a variety of different pies already made might be the way to go,” says Wayne D’Andrea, managing partner of Papa Pizza II in Milford, Connecticut. “Otherwise, I’d suggest making cheese pies only and adding your toppings to order.”

Lexy Frautschy, owner of Ian’s Pizza on State in Madison, Wisconsin, echoes that sentiment. “We generally don’t modify our slices. Our business plan is based on a lot of throughput, so we make sure to always have plenty of varieties available. We keep around 24 different kinds at a time, and with that large variety people generally find something that suits their taste buds.” At Rise PizzaWorks in Charlottesville, Virginia, pizza can be ordered as a whole pie or by the slice. All are madeto-order, allowing the customer to customize from crust to toppings.

John Spagnolo, co-owner at Rise, says the low guest check generated by slice sells requires operations to focus on high volume.

“That said, we still sell both slices and whole pies because there is a very significant market for whole pies, and selling whole pies allows us to compete in that market space, too,” he says. “In addition, beyond variable costs like labor and cost of goods, an operator still has other expenses, and whole pie orders result in higher guest check amounts — (and) therefore more cash.”

But what is the potential for profit in slice operations? Franco Antonio Salese IV, manager and operator of Juniors in Burlington, Vermont, reports a 40-percent revenue income from single sales.

“Buying eight individual slices is generally more profitable than when your customers are buying in quantity such as a whole pie,” says Frautschy. “For us, a 20-inch cheese with eight slices costs $12. However, eight individual slices sold through the line at $2.50 makes us $20. That is a big difference. Not all the 20-inch pies are that cheap, but in every case the slices make us more.”

According to Spagnolo, when comparing the profitability of a slice versus a whole pie, you have to consider the revenue generated from the sale and your prime cost.

“Obviously, the whole pie generates more revenue for us, but when I calculate the prime costs, the cost of our slice is about four percent less than our whole pie,” says Spagnolo. “On an item-to-item comparison basis, the slice costs less and … is more profitable.”

Frautschy believes high profitability is possible with pizza by the slice operations. However, he believes a fresh product is more important than the bottom line. “We chose to serve high quality food at a reasonable price and spend a little on extra things,” he explains. “That lowers our margins.”

Government regulations won’t allow operators to let slices sit all day — it’s a public health issue. That said, the potential for waste in single slice operations can be high, says John Racanelli, owner and founder of Racanelli Pizza in St. Louis, Missouri.

That’s why Mike Agrawal, founder of Slice, the Perfect Food, par-bakes crusts and dresses them to order. This allows unsold crusts to get used the next day.

Back at Rise Pizza Works, the cost of discarding a crust is substantially less than tossing a dressed pizza, says co-owner Andrew Vaughan.

“We manage the potential of waste in two key ways,” Vaughan said. “We track our usage daily and use the historical data to forecast our expected needs for a given day; and as the business day draws to a close, we slow our par baking to keep our make line stocked with a minimal amount of crusts.”

The equipment for single slice restaurants is the same as most traditional pizza places. Frautschy adds smaller reheat style ovens may be needed to serve slices during peak times. However, Agrawal says they use a dough sheeter to increase their crust production.

Overall, Vaughan recommends studying other operations for inspiration. “Make sure you have a product that can distinguish you from the many other by-the-slice operations that are out there,” he says. “Whether it is outrageous toppings, a great crust or some combination/specialty slice you are known for, work hard and focus on all of the small things that lead to a successful restaurant.” ?

Terah Shelton is a freelance writer based in Duluth, Georgia.

 

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