The economics of pizza

Rick Brady at Stones Cry Out looks at the inner workings of the pizza industry, based on how he experienced it in San Diego during a rise from lowly delivery guy to General Manager. He writes in response to news of a proposal to create a United Pizza Workers union.

Because I have been both a driver and a manager, I can say that the UPW proposal, if successful, will likely force many store closures. According to the article, the UPW is targeting the large chain stores like Papa John’s, Pizza Hut, Domino’s, and others. With costs increased for these large chains, mom and pop shops, free from having to negotiate with the UPW, would take market share. With smaller market share, hours for workers at the chain stores would be cut back and stores could be closed.
Is there a better way? Possibly.
Based on my interviews of prospective crew members, I’ve learned that: 1) pay within the fast food industry is fairly normalized and static; and 2) most applicants seeking full-time pizza work, including managers, have spent years in the fast food service industry.
Based on my experience as a manager of fast food workers, I’ve learned that: 1) every store has one or two truly excellent employees; 2) every franchise has one or two truly exceptional managers; 3) every so often a franchisee gets lucky and pairs a star GM who builds and maintains an entire crew of excellent employees; and 4) the stores that have the best managers and crews are the most profitable stores and also take market share.

An employee isn’t excellent just because he is efficient. An excellent employee has mastered every aspect of her job, including customer service. I don’t know how many times I told my best employees, “If I only had 20 more of you…” My stores would have been so stinking profitable if I could have built an “all-star” team comprised of the best crew members from around the region.
How then can a franchisee build all-star crews in each store?
Simple.

No, I’m not going to give away his idea. Read the whole thing. It’s surprisingly fascinating stuff.
I wonder if the coffee industry bears much resemblance to the pizza industry. I’ll have to ask my friend Patty, who runs a coffeeshop nearby.
Hat tip: Hugh Hewitt

Comments are closed.