In 1971, Chicago was already known for its deepdishand unique style of thin-crust pizzas. So Italianimmigrant Rocco Palese, owner of Guy’s Pizza, got intothe business knowing that he had to make his markon the pizza scene by creating something completelynew—but what? That question was answered whenhe returned for a trip home to Potenza, Italy, andasked his mother for her recipe for scarciedda, anItalian Easter cake, which is stuffed with ricottacheese and other fillings for the holiday. After someexperimenting, he hit on the perfect formula—a highwalledcrust base, piles of toppings, and another layerof crust and sauce on top—and soon opened the firstNancy’s Pizza (www.nancyspizza.com) location inHarwood Heights, Illinois, just outside of Chicago,selling what he called “stuffed pizza.”
Before long, people took notice of Palese’s newinvention—and how could they not? Weighing awhopping 5 pounds for a 12” pie, this pizza was too heftyto be ignored, and comfort food-loving Midwesternersturned out in droves to try the newpizza style. Themedia, too, caught on: Chicago Magazine, the ChicagoTribune and ABC-TV all recognized the location as“best pizza in Chicago”—a major accomplishment ina city teeming with pies of all kinds. But even Paleseprobably would not have expected the growth andsuccess that Nancy’s has achieved over the years, andits ambitious plans for expansion on the horizon.
The Growth of a Brand
At first, Palese offered sit-down Italian restaurantservice, with chefs and waitresses, serving traditionalItalian dinners such as chicken cacciatore, vealscallopine and pasta alongside its pizza. Though thefirst restaurant originally seated 35, expansion wassoon under way to make room for 140 seats. Throughthe years, other locations, more media accolades anda growing number of dedicated fans followed, butownership changed hands in 1990, when Palese soldthe business to a licensee of Nancy’s since 1978, DavidC. Howey Jr. Then growth really began to skyrocket.
In 1992, the first prototype for Nancy’s Pizza Express openedin Tinley Park, Illinois, and generated a model that still remainsa success, with a focus on carryout and delivery. Howey beganfranchising in 1994, and today’s 40 locations spread across thecountry, in locations such as the Atlanta area, where Nancy’soutposts have found resounding success. But amidst the measuredgrowth, Howey has focused on retaining consistency byregulating every step of the pizza making process, from obtainingraw materials to adding the toppings. “All of our stores purchasefrom one central distribution center,” says Howey. “Wehave established systems in place, with operations manuals.Our corporate trainers assist stores with training and marketing,and also with periodic quality assurance visits.”
Howey branched out further when he decided to purchase therights to Al’s Beef in 1999. Al’s Beef is an established name inChicago, having served juicy Italian beef sandwiches to Chicagoanssince 1938. Now, several of the Nancy’s restaurants serveboth Al’s sandwiches and Nancy’s pizza, which, says Howey,make a better pair than some might imagine. “The additionof Al’s Beef to our current system expanded our penetrationinto the lunch daypart and gave us the opportunity to developdual-brand units,” says Howey. “Al’s Beef complements Nancy’sPizza because they are two very strong brands in the Chicagomarket, serving very different menus.”
The Nancy’s side of the menu, however, has been keptsimple, with pizza (thin and stuffed), pasta dinners at selectlocations, sandwiches and appetizers. More recent additions tothe menu are the Super Thin Crust (with half the ingredients ofthe traditional thin-crust pie) and the Stuffed Crust Lite (whichis “only” 1.5” thick, as opposed to the usual 2.5”). On the Nancy’sside of the business, “Our pizza still represents 80% to 85%of sales,” says Howey, speaking in his current role as presidentof Chicago Franchise Systems. What makes the pizza such adesired, special item? Howey credits top-notch ingredients, including“dough that’s made fresh in the store every day, pizzasauce that’s mixed fresh in the store, and unique pizza toppingsand recipes that we’ve created exclusively for our stores.” Anotherbreakthrough Howey added to the business involved thecreation of an oven that cut baking time for the thick pies from45 to 13 minutes, allowing the stores to handle the lunch anddinner rushes much more effi ciently.
Nancy’s may be an established name in the Chicago area, butHowey doesn’t count on the crowds to come in by themselves.Marketing tactics for Nancy’s mostly focus on efforts that drawin locals while relying on the history and legacy of the brand asthe originator of a widely imitated style, the stuffed pizza.“We have a really good sense of who our customersare, and we try to appeal to them,” says Howey,pointing to families and those in the 15-to-45age group as the typical customers. “The majorityof our advertising is local, concentratingin the immediate trade area of the stores. We use postcardmailings, Advo, Money Mailer, Valpak and menu inserts.”
Online ordering has also worked well for Nancy’s, allowingcustomers across the country to place their orders on the Web.Though the option was rolled out relatively recently—one yearago—and is only now being actively marketed, these salesalready account for 3% of orders. The entire chain is not yeton the system, but plans are in place to have every locationaccepting online orders by the end of the year.
Since the start of franchising for Nancy’s 14 years ago, thechain has been careful with its growth but is now planning onmaking a push for increased nationwide expansion. Up untilnow, says Howey, “we’ve only franchised by word of mouthand the success of other franchisees. This year, for the firsttime, we are in the process of fi nalizing our online advertisingprogram, attending trade shows, etc.” The end goal is a loftyone: build 100 additional stores over the next four years, inmarkets outside the Chicago area (in the past, Nancy’s locationshave set up shop almost exclusively in Illinois). Howey islooking at Atlanta, where he has already been successful withtwo locations, as well as Arizona. “We intend to bring Nancy’sto many new markets,” he says. “We have a tremendousdemand for our products in other cities.”
Of course, its meteoric growth doesn’t shield Nancy’s fromthe challenges inherent to the industry—among them, recordhighprices for gas, cheese and flour. “Pizza prices have notkept pace with rising ingredient costs, real estate costs, etc.,”says Howey. “We do everything we can to keep prices down,but we do have to periodically increase item prices.” Howeymaintains that no matter what the cost, the quality of the foodwon’t suffer. “We still buy the same ingredients that we alwayshave, even with the rising costs,” he says. “We are big believersin giving our customers what they expect. We simply won’tlower quality to save money.”
That attention to the customer experience and pride in theproduct has kept Nancy’s locations flourishing, and Howeyexpects that these priorities will continue to have the sameeffect in the future. “It’s one thing to make money, but anotherto be true to who you are,” he says. “You have to be true towho you are and make the best product that you can, and yourcustomers are going to come back.”