How the Country Lost Interest in Its Appetite for Pizza Hut
In the past, the popular pizza chain was the top choice for groups and loved ones to enjoy its all-you-can-eat buffet, help-yourself greens station, and make-your-own dessert.
However a declining number of patrons are visiting the restaurant these days, and it is reducing half of its British locations after being bought out of administration for the second time this year.
It was common to visit Pizza Hut when I was a child,” notes one London shopper. “It was a regular outing, you'd go on a Sunday – spend the whole day there.” Today, aged 24, she states “it's not a thing anymore.”
For young customer Martina, some of the very things Pizza Hut has been recognized for since it launched in the UK in the 1970s are now outdated.
“The way they do their buffet and their salad station, it seems as if they are cutting corners and have lower standards... They're giving away so much food and you're like ‘How is that possible?’”
Since ingredient expenses have soared, Pizza Hut's buffet-style service has become increasingly pricey to operate. As have its locations, which are being cut from over 130 to 64.
The business, like many others, has also faced its expenses rise. This spring, staffing costs jumped due to increases in the legal wage floor and an increase in employer taxes.
Two diners say they used to go at Pizza Hut for a date “occasionally”, but now they get delivery from Domino's and think Pizza Hut is “too expensive”.
Depending on your order, Pizza Hut and Domino's costs are similar, says an industry analyst.
While Pizza Hut has takeaway and deliveries through delivery platforms, it is missing out to larger chains which specialize to off-premise dining.
“The rival chain has taken over the off-premise pizza industry thanks to intensive advertising and constantly running deals that make consumers feel like they're getting a bargain, when in reality the standard rates are on the higher side,” explains the analyst.
However for the couple it is justified to get their special meal sent directly.
“We absolutely dine at home now instead of we eat out,” explains Joanne, matching recent statistics that show a decline in people visiting informal dining spots.
Over the summer, quick-service eateries saw a six percent decline in diners compared to the year before.
There is also a further alternative to ordered-in pies: the frozen or fresh pizza.
An industry leader, head of leisure and hospitality at a major consultancy, points out that not only have retailers been selling premium prepared pies for a long time – some are even selling pizza-making appliances.
“Evolving preferences are also playing a factor in the performance of casual eateries,” states Mr. Hawkley.
The increased interest of protein-rich eating plans has boosted sales at grilled chicken brands, while affecting sales of carb-heavy pizza, he adds.
Since people go out to eat more rarely, they may seek out a more upscale outing, and Pizza Hut's classic look with booth seating and nostalgic table settings can feel more retro than luxurious.
The “explosion of artisanal pizza places” over the last decade and a half, for example boutique chains, has “dramatically shifted the consumer view of what good pizza is,” notes the food expert.
“A thin, flavorful, gentle crust with a few choice toppings, not the overly oily, dense and piled-high pizzas of the past. That, I think, is what's caused Pizza Hut's downfall,” she says.
“What person would spend £17.99 on a small, substandard, disappointing pizza from a franchise when you can get a gorgeous, skillfully prepared traditional pie for a lower price at one of the many authentic Italian pizzerias around the country?
“It's an easy choice.”
An independent operator, who operates Smokey Deez based in Suffolk explains: “People haven’t lost interest in pizza – they just want better pizza for their money.”
He says his adaptable business can offer gourmet pizza at affordable costs, and that Pizza Hut had difficulty because it could not keep up with new customer habits.
From the perspective of an independent chain in a city in southwest England, the founder says the industry is broadening but Pizza Hut has neglected to introduce anything innovative.
“Currently available are slice concepts, London pizza, new haven, fermented dough, traditional Italian, deep-dish – it's a delightful challenge for a pizza-loving consumer to explore.”
Jack says Pizza Hut “must rebrand” as the youth don't have any fond memories or attachment to the company.
In recent years, Pizza Hut's market has been fragmented and distributed to its fresher, faster rivals. To keep up its expensive staffing and restaurants, it would have to raise prices – which industry analysts say is tough at a time when household budgets are shrinking.
The leadership of Pizza Hut's global operations said the acquisition aimed “to safeguard our guest experience and save employment where possible”.
He said its immediate priority was to keep running at the remaining 64 restaurants and delivery sites and to support colleagues through the restructure.
However with significant funds going into maintaining its outlets, it likely can't afford to invest too much in its off-premise division because the sector is “difficult and using existing delivery apps comes at a expense”, commentators say.
But, he adds, cutting its costs by leaving competitive urban areas could be a smart move to evolve.