By Rick Hynum
In the midst of the coronavirus pandemic this spring, two worrisome questions haunted every waking hour—and, most likely, the late-night dreams—of pizzeria owners nationwide: When will things get back to normal, and what will “normal” look like? Seemingly overnight, their world had turned upside down, capsized by a microscopic organism, a lowly “bug” invisible to the naked eye. Suddenly, the future, always unknowable, felt unthinkable, the shrouded threat of bankruptcy and failed dreams looming in the near distance.
They had met the enemy, and the enemy was us—potentially every one of us, ordinary folks who might be carrying the pathogen unawares: customers, coworkers and staff, wives or husbands or parents or children, the sales rep, the delivery truck driver. And as throngs of stressed-out Americans ransacked the supermarkets and beat a hasty retreat to the relative safety of their homes—and their own kitchens—pizzeria owners sized up the situation and finally did the only thing they knew to do.
They helped. They rose to the occasion. They made sacrifices and painful decisions—including reducing their hours and laying off employees whom they loved like family members—but they didn’t stop making pizza. And they gave a lot of it away to community heroes—doctors, nurses, paramedics and police officers—fighting the good fight and to families and children in need.
In a sense, it was, to borrow Churchill’s famous phrase, the pizza industry’s finest hour. Certainly not in terms of profitability—although most owners figured out a way to at least keep their businesses running. But as community leaders at a crucial point in history, these entrepreneurs strove, persevered, triumphed—and emerged as hometown heroes in their own right.
It wasn’t easy, and it wasn’t fun. In those states and cities that mandated closure of dine-in services, some pizza restaurants made a relatively smooth transition to delivery (contact-free) and carryout only. After all, it’s what many of them do best. Not so for Derrick Tung, owner of Paulie Gee’s Logan Square in Chicago, where dine-in comprises up to 90 percent of business in “normal” times. “Our restaurant was never really built for delivery and pickup,” he says. “Suddenly, no one could dine in, and we realized immediately that we needed to make some changes.”
After accepting phone orders for one night, Tung quickly discovered that wasn’t the way to go—for starters, he had only one line. “The phone just never, ever stopped ringing from the moment we opened,” he says. He ditched it and signed up instead for a new online ordering system called Tock to Go, launched in March specifically for pandemic-impacted restaurants that are new to carryout and delivery.
True to his “employee-centric” approach to business, Tung also consulted with each member of his staff to find out who wanted to keep working and who wanted to self-isolate at home. He gave the latter up to $1,000 out of his own pocket to tide them over for a few weeks. “Every staff member who’s working for me right now wants to work,” he says. “If the company can break even and the staff are making extra money from tips and wages, that’s great, so why not do it?”
Sidebar: The Paycheck Protection Program
Does your pizza business qualify for a loan through the federal government’s Paycheck Protection Program? Here are the facts:
A small business with under 500 employees, including multiunit operations, is eligible for the loan if it was operational as of February 15, 2020, had paid employees on the payroll, and paid payroll taxes.
Loan amounts are based on your average payroll from the prior year, plus an additional 25%. Loans are capped at $10 million.
The federal government will forgive the loans, up to the full amount, depending on your payroll costs, payments of interest on mortgage obligations, rent or lease expenses and utilities. To qualify for forgiveness, business owners cannot reduce their workforce during the following eight-week period or reduce employees’ salaries or wages by more than 25% during that eight-week period. By rehiring all employees laid off since February 15 or increasing wages/salaries that were previously reduced due to the pandemic by June 20, the business will likely qualify for full loan forgiveness.
Loans are available through Small Business Association-certified lenders, including banks, credit unions and other financial institutions.
The deadline to apply for Paycheck Protection Program loans is June 30, 2020. Talk to your bank, accountant or attorney for further instructions.
Bryan Morin, owner of Federico’s Pizza & Restaurant in Belmar, New Jersey, went so far as to take out a $50,000 line of credit to keep employees on his payroll—and earned national coverage for it on Fox News. Morin eventually had to close his doors temporarily but said he would continue paying his staff during that period. And when Skyler Reeves, owner of Rosa’s Pizzeria in Prescott, Arizona, received an anonymous gift of $2,000 (from a woman who walked in, handed him an envelope and then left without a word), he used the unexpected windfall to help laid-off staffers pay their most worrisome bills.
Protecting staff was also top priority for Will Grant, owner of That’s A Some Pizza in Bainbridge Island, Washington. As the bad news settled in, his mother pushed him to shut down his lunch business—which he did. But, he adds, “My initial thought was, ‘Shut down everything [and keep] just me and one or two other employees. We can do this ourselves.’ But what about the people who need the work and aren’t going to be able to pay their bills? After the fear subsided, I was like, no, I’m not the only one who needs to eat.”
Seven of his 20 employees quit anyway, out of concern for their health, which helped save money on labor. Still, Grant notes, once other eateries started making adjustments to survive, his shop went from being one of two delivery restaurants in his market to one of 25.
And he’s okay with that. “I want us all to survive this,” Grant says. If anything, he finds himself wrestling with an ethical dilemma. “I don’t know that marketing [to get people to] come to my restaurant is the right thing to do right now, at least not for us. I don’t want people feeling obligated to come to my restaurant when they don’t even want to leave their houses. And trying to take that business away from other people isn’t what I want to do either.”
An Opportunity to Serve
Not everyone will survive, unfortunately. Pizzerias and other restaurants that were already on shaky ground prior to the pandemic likely won’t bounce back, especially if they relied heavily on dine-in business. In late March, a National Restaurant Association (NRA) survey found that overall sales had plummeted by 47% from March 1 through March 22. In a March 18 letter to top government officials, the NRA predicted restaurant sales would decline by $225 billion over the next three months and that between five and seven million industry jobs would be lost.
The situation was bleak. But those operators who stayed open saw the crisis as an opportunity to serve others—to deepen their connections to the community, help people in need and generate goodwill for the future. When local schools closed down, many pizzerias gave away slices and drinks to disadvantaged children who often depend on free or discounted school lunches for their only meals. Some offered free slices to anyone facing food insecurity, including laid-off workers from all trades and professions. Others dispatched delivery drivers to drop off free food at hospitals, police departments and fire departments, showing their support for the local heroes working on the front lines of the crisis.
Sidebar: Year of the Meal Kit?
Is it too early to declare 2020 the year of the meal kit? Make-at-home meals exploded as pizzeria operators—independents and chains alike—scrambled to make up for losses in dine-in revenue. Oath Pizza, a Boston-based brand with 60 locations nationwide, made feeding families of all sizes easier during the pandemic with its Craft Pizza Care Packages. Available with gluten-free, dairy-free and vegan options, the meal kits range in price from $65 for the Kiddo Care Package (three Cutie Pie cheese pizzas plus two Honduran chocolate brownies and one marshmallow bar) to $110 for the Bestseller Care package (six pizzas, three brownies and three marshmallow bars). In Denver, the five-store Mici Italian Handcrafted introduced its own pizza kits, which included fun, pizza-related educational resources and activities developed by co-founder Kim Miceli, a former teacher.
Senior adults got their share of the pie, too. In Fort Pierce, Florida, Scott Van Duzer, owner of a Big Apple Pizza & Pasta store, invited customers to pay $20 to have pizzas delivered to senior citizens living in nursing homes or self-isolating in their own residences, along with homemade cards created by children to brighten the old folks’ day. Lorrie Moffitt, owner of Knik Goose Bay Pizza Company in Wasilla, Alaska, took the idea one step further—she sent her entire staff home and spent all of her time baking pizzas for elderly and disabled people who couldn’t leave their homes.
And then there was Jon Paul Brancato, co-owner of Village Pizza in Goshen, New York, and a father of five. His 37-year-old eatery had stopped delivering pizza 20 years earlier but had to revive the practice once dine-in services closed statewide. Brancato also introduced family-size trays of items like chicken Parmesan, penne vodka and baked ziti for $65. But what about those customers who’d lost their jobs and couldn’t afford his food? Brancato announced, both in the local media and on Facebook, that they could eat now and pay later—no one would go hungry on his watch. “We will make any financial arrangements for any families that may be suffering during this difficult time,” Brancato posted on Facebook. “It’s never a matter of trust. We know everybody is good for their word. That’s the way it’s always been shown to us here.”
An Explosion of Innovation
Along with not-so-random acts of pizza kindness, there was an explosion of innovation, too. Suddenly, everyone was offering make-at-home pizza kits and take-and-bake options. Marie Jane’s Cannabis Connection, a marijuana dispensary in Corvallis, Oregon, started delivering 14” housemade pizzas (developed by Ed Barbeau of Pisano’s Woodfired Pizza in Bend, Oregon) with their weed, promising to “make memorable moments” for quarantined customers, “even if the memories of those moments are a little fuzzy.” Around the same time, Ghost Pizza Kitchen in Los Angeles developed Vampire Pizza, a vampire-themed immersive game kit—complete with roles to play and mysteries to solve—as part of a pizza delivery deal that stuck-at-home customers could really sink their fangs into.
As panicked consumers in Grand Rapids, Michigan, depleted supermarket shelves of most pantry basics, Dan Uccello, owner of three Flo’s Wood Fired Pizzeria stores, sized up his inventory, saw he had a lot of what folks needed in stock and started Flo’s Home Goods. Selling milk, eggs, bread, pastas, sauces, juices, even toilet paper, Uccello made a quick segue into the grocery business and sparked a trend. A few weeks later, California Pizza Kitchen launched a similar concept on a grander scale, CPK Market, which also peddled fruits and veggies, raw meats and desserts along with make-at-home meal kits.
But in terms of innovation, it’s hard to top Dimitri Syrkin-Nikolau, owner of Dimo’s Pizza in Chicago. As hospitals coped with a flood of COVID-19 patients and a lack of needed equipment, such as masks and ventilators, Syrkin-Nikolau used his high-heat oven to produce a prototype for a protective face shield for healthcare workers. He heated an acrylic sheet in his oven to the point that it became malleable, then collaborated with a local metalworks company to create molds for the face shields. “We are used to making things very quickly, in large quantities, very cleanly,” Syrkin-Nikolau told BlockClubChicago.com. “I would love to [increase my] hours to produce face shields. I feel like that’s what’s called for, so that’s what we’re trying to do.”
Keeping the Doors Open
What the future holds for the pizza industry, no one can say, so we might as well be optimistic—but also vigilant and transparent. Not only is it important to stick to your current regimen of deep cleanings, disinfecting surfaces and personal hygiene, you must also continue to let customers know you’re doing it. In any crisis, communication is key, notes Kelly Richardson, owner and founder of Venone Public Relations, a crisis communications, public relations and marketing company with many restaurant clients. “More important than the message is that it’s clear,” Richardson says. “Our channels of communication are so cluttered right now with information that it’s important to be clear, concise and reliable.”
Make sure to keep your website updated with your current hours, the latest version of your menu (if it has changed), your cleaning protocols and other vital information. “Your customers are paying attention to what you say and do,” Richardson says. “If you say you are cleaning, make sure you are doing it. If you [say you] are offering contactless pickup, make sure you’re doing that as well….Customers are also very interested in how businesses are handling reduced hours for employees, so don’t be afraid to talk about what you are doing to keep everyone working and fed.”
Email is another good way to stay in touch, says Bill Corbett Jr., owner of Corbett Public Relations on Long Island, New York. “This is a great time to collect email addresses from customers,” he says. “They want to buy, but they don’t know, without calling, if you are open. The messages don’t have to be long, but owners must show and explain their plans for staying open. You may even have to overshare.” At the same time, Corbett urges, “Don’t be too serious—keep messages upbeat and fun.”
Here are some more tips for staying competitive during the coronavirus crisis:
Focus on value. Millions of Americans are out of work, which means belt tightening and little money to waste. “We are specifically communicating value-oriented specials to stay top-of-mind for consumers at the moment, since discretionary spending is extremely tight,” says John Stetson, owner of four Stoner’s Pizza Joint franchises in Florida and Georgia. Offer bundled deals and a variety of carryout and grab-and-go options, including family-size meals that can be taken home and reheated.
Devote some time to brand-building. Everyone is on social media right now, in part to stay on top of the latest news and because they don’t have much else to do. “This is a great time for owners to build their personal brands…and tell their personal stories so people can get to know them better,” Corbett says. Pizza making videos and mouthwatering food photos will remind customers of what they’re missing and give them something to look forward to once the crisis passes. Eric Greenwald, president and COO of Grimaldi’s Pizzeria, recommends making good use of Instagram Live to stay engaged with customers. “This could include offering virtual cooking classes and pizza/wine pairing suggestions, virtual tours around the property, promoting a ‘pizza of the day’ to encourage pickup orders, and more,” Greenwald says. “More than ever, customers are looking to connect. By showing the behind-the-scenes of your pizzeria, the authenticity of the company will stand out above regular posts to create and display a human element online.”
Make friends with influencers. Social media influencers and local celebrities can give your business a big boost at a time when you need it, Richardson says. “I’m advising clients to invite local influencers—the ones with less than 5,000 followers—or some of their best clients, even other local business owners, to come in and grab a free pizza or a meal and document it on social media.” And don’t forget to remind local newspapers and TV stations that you’re open—many of them are likely still publishing lists of hometown places to eat.
Don’t forget the special-diet crowd. The demand for gluten-free and low-carb crusts won’t go away, even in a pandemic. “There are customers out there with special dietary needs that may be having a hard time finding good options right now,” says consultant Diana Yin, founder of Los Angeles-based Swan and Company and a former restaurateur who won a food truck in the 2013 season of the Food Network’s Food Truck Face-Off. “This includes vegans and vegetarians, folks with gluten allergies, etc. If they had limited options before, it’s likely even more limited now.”
Find ways to ensure recurring sales. Think about those dine-in regulars who can no longer enjoy their weekly night out at your pizzeria. “Start a subscription service,” Yin suggests. “This could be a weekly meal for a family of four, such as Pizza Friday, for which families can expect pizza, salad and drinks delivered at the same day and time every week to ensure some predictability during a time of chaos. If you sell something that people consume regularly, offering a subscription service can provide a steady income for you while providing the comfort of reliability for your customers.” Also reach out to your local grocery stores. “You might be able to provide them with product that they are having a hard time stocking, such as ready-to-bake pizza dough or bake-at-home pizzas,” Yin points out. “Now might be a good time to establish some new wholesale accounts.”
Adjusting to a New Environment
Sooner or later—perhaps, with any luck, by the time you’re reading this article—the country will reopen for business. And restaurants left standing will need to move cautiously and stay flexible. “Whenever we get to a place of ‘normality,’ it will be important to adjust slowly and not get caught upside down,” Greenwald says. “An easy way to avoid getting caught shorthanded or heavy-handed is to focus on your labor costs hourly. Ensure that you are operating within your target-labor range hour by hour and adjust staffing as needed daily.”
If you temporarily closed your dining room, you’ll need to think through your reopening strategy carefully. “Plan your work, then work your plan,” Stetson recommends. “That means accounting for both best and worst-case sales projection scenarios and then operating within your means and managing the business by the numbers. It will be critical, when reopening, to establish your daily break-even costs by understanding your prime-cost targets and managing them accordingly. This will mean operating with an eye on labor-cost percentages on an hourly basis and taking inventory daily, so you have an accurate representation of daily COGS (cost of goods sold). It’s also important to turn inventory as quickly as possible to avoid money sitting on shelves by over-ordering or leading to potential waste.”
Sidebar: Additional Marketing Tips
Don’t Knock TikTok. One of the fastest-growing social media platforms, TikTok allows users to create and share 15-second videos and has 800 million active users worldwide—most of them under 30 and socially aware. Restaurant brands like Chipotle use TikTok, and hometown independent restaurants can, too. Individual clips can be assembled into 60-second videos, and a live-streaming option is also available. Use TikTok to speak directly to your customers about how you’re taking care of your staff and giving back to the community. Showcase your employees and offer quick and easy recipes that customers can try at home.
Update your Google My Business page. If you haven’t done so already, tweak your Google My Business page to include your new hours, links to updated menus, and details about your contactless delivery and curbside options.
Don’t be afraid to brag. If you’re providing free food to frontline healthcare heroes or to those in need, this is not the time to keep it a secret. In fact, invite your customers to help you by making donations over the phone or through your online ordering platform. Encourage customers to buy gift cards for the residents of nursing homes, homeless shelters and anyone else in need. Whenever possible, shoot and post photos when you drop off donated pizzas—they will get shared on social media, thus encouraging more donations.
Greenwald agrees. “One of the biggest mistakes [you could make] is not taking time now to plan and prepare for reopening,” he says. “Think about all the things you will need to get in place to open and create a reopening checklist to make sure you cover all the necessary steps. We’ll also be operating in a new environment, so understand and estimate where consumer confidence will be. Look around your area to see how many others will be reopening. Will you be one of few or one of many? This will determine the level of demand you should expect.”
Don’t forget those competitors who shut down entirely and have recently reentered the marketplace, says Toopan Bagchi, a senior advisor with The Navio Group in Minneapolis. “Your in-store traffic may increase, but many competitors will also be reopening and will benefit from pent-up demand and sympathy from customers,” Bagchi says. “The best practice would be to carefully track key metrics and cash flow on a daily basis and preserve options wherever possible like flexible staffing, reduced opening hours, and purchasing in smaller increments to avoid getting deep into debt or overspending.”
Finally, Greenwald says, stay in touch with your vendors, “because you will need their support to get up and running. If you have multiple locations, start making a list prioritizing which location(s) to open first. And just like any opening, you may be adding new members to your team, so plan to have properly trained staff. Planning and timing will be the key to a successful reopening plan.”
Like we said, no one knows what “normal” will look like in the coming months. But smaller independent pizzerias that stayed open throughout the pandemic might emerge stronger from the challenges they overcame, says Ed Noe, vice president of purchasing and marketing for Colony Foods. “This is our opportunity,” Noe said in late March, as the pandemic was worsening nationwide, “and I think independent operators who rise to the occasion will see a bump in business now, but they’re also going to see a bump in business later. They will see new customers that they had to spend a lot of money on during normal times to get their brand recognized. You just need to be open and let people know you’re open…and when all is said and done, you now have those new consumers in your database.”
Rick Hynum is PMQ’s editor in chief.