Picasso's Pizza: operating in a high-crime area

I have the responsibility here at the magazine of posting the day's pizza news to our website. Each day when I am searching for interesting headlines, I come across a lot of robberies and injuries of pizza drivers.

These everyday news stories made me wonder how common these crimes are and what it's like to operate in a high-crime area. Here is the story of one brave operator.          

Andrew Albert is taking a stand against crime in Lake Highlands , Texas, a suburb of Dallas. Andrew opened his pizzeria, Picasso's Pizza, ten years ago in an area unique to large cities, Section 8 government funded apartments also known as "the projects," located right next door to $400,000 homes.          

"We've got a lot of government housing that is not well monitored," Andrew says. "The government is not keeping them up, running background checks or upgrading the housing. The crime is increasing." So, what is keeping him here? "We basically have three choices when it comes to business," Andrew says. "We can stay and hope the crime goes away or we can move or we can stay and fight back."

FIghting Back          

Fighting back has become his weapon of choice. Andrew grew up in this area. When it was time to settle down, he was working part-time for the former owner of Picasso's as a delivery driver and manager on the weekends while he was a traveling musician.          

The pinnacle of the crime came after several years of two or three drivers being robbed each year. On February 25, 2000, Andrew's brother, David, was making two deliveries. After completing the first delivery, David returned to his truck. Police determined that someone tapped on his window and demanded either money or the vehicle.          

David tried to drive away. He was shot through the back of the truck through two sheets of metal with a sawed off shotgun. He died on the scene.          

After all these events, you would think no businessman in his right mind would stay in an area with such a high crime rate, but Andrew has and flourished. Andrew has started a community initiative to get the crime off the street. He told his story to The Dallas Morning News, went on local television shows and is working to get his story to other local media.          

Andrew has also tackled the crime issue on the business front by creating rules for the individual complexes in the area, and changing his marketing strategy. "We've started marketing to homes," Andrew says. "We'll stay in business, but not flourish if we don't deliver to the complexes."          

"We've partnered with complexes. Some places we won't deliver to after dark, and some we have meet us at the gate. We'll give discounts for carryout. We won't risk the safety of our drivers. We don't go out of our way to advertise to apartments that are not maintained."          

Seventy to 80 percent of deliveries made are to homes, and 20 to 30 percent are made to apartments. Andrew says that the areas around the homes have been problematic for his drivers because many of them back right up to these under-maintained complexes.          

"The drivers have free reign whether or not to deliver an order," Andrew says. "If they have a fear, it doesn't have to be tangible. We call the customer and explain. It's not a problem."          

"We're working very hard to make it in this neighborhood," Andrew says. "We've seen many good restaurants move out of the neighborhood because of the crime. We've had a very large decline in business chains."          

How bad is the crime in this area around these Section 8 projects? Andrew sent me a report detailing the incidents that have happened over the past ten years. Some of these incidents were rather scary. Only two weeks after he opened in 1993, Andrew was robbed at gunpoint. The perpetrator was caught and convicted.

Security Measures          

The restaurant has been robbed many times, and Andrew has made improvements each time in the security system. He has spent about $20,000 on securing his location. The most drastic thing Andrew did to curb crime in and around his store was to move his location up the street about 50 yards to a higher trafficked area.          

Some of the other security improvements included building a bulletproof glass wall, installation of cameras and monitors, limited access doors, panic buttons and computers to track check and credit card fraud, which became another problem for the store.

Stopping Check & Credit Card Fraud

They were getting almost $1,000 per month in stolen and closed accounts on top of the normal NSF checks. Andrew filled us in on how he has been able to lower his out-of-pocket expense for bad credit cards and checks. "The first thing you can do is call the credit card company to verify the identity," Andrew says. "We do this by demanding that the delivery address and the billing address match. Also, the person's whose name appears on the credit card must be present. If we have any doubts we just don't accept the card, and we call the credit card company to report fraud."          

As for checks, he has developed a stern acceptance policy. "We've stopped taking checks over $40," Andrew says. "We're up front with our customers on the phone about taking checks. The person whose name appears on the check must appear at the door with a driver's license. Usually if the checkbook is stolen the person will hang up or not pick up the order.          

"We've gotten our NSF amounts down to as low as $10 to $12 a day, but we've seen a recent climb," Andrew says. "If you develop ways to stop scammers, they come up with new ways to scam you. It's basically a matter of staying on top of the problem."

Marketing Strategies          

Andrew has to have a variety of marketing tools to cater to everyone in his unique suburban area. "We want to provide a deal for anyone to afford it," Andrew says. "For a buck or two more, customers can get a better product than they can at one of the high volume/low price places."          

Andrew has a detailed marketing plan that encompasses his idea to "market to everybody." His main tool is the door-to-door hanger. The hanger is two-sided in four colors. All the photographs used on the hanger are taken in the restaurant with waitstaff and original food. They use a thick card stock with mini-menus and their website as the featured advertisement.          

"Our hangers are way more eye-catching than the competitions'," Andrew says. "Ours makes us look more like a corporation. Since we can't compete price-wise, we have coupons that feature offers such as two pizzas for a particular price. We also try to feature something free like two free drinks. We recently started offering a package deal with two pizzas, two salads and two drinks for one price."          

He also takes out small ads in local newspapers and magazines, and he does an occasional mailer. New customers get a dose of marketing with their first order. They get a full menu and a Picasso's magnet for their fridge.          

A major way Andrew markets to his customers is when mistakes are made. "We turn mistakes into marketing," he says. "We deal with problems in three ways: we do it quickly, we apologize and shock the customer with a quick delivery of the messed up order plus something else like a couple of free dressings or an order of breadsticks, and we give them coupons for $5 off their next order or we take a couple of sodas with the left out item. Our drivers get there in 10 minutes instead of 30."          

Delivery is one of the most important areas of focus at Picasso's. Andrew says they put an emphasis on getting the food out fast. The average delivery time for a Picasso's order is 25-35 minutes during the week, and 40 minutes at the most on a Friday night.  "I have to give credit to Rockland POS and how we know our neighborhoods," Andrew says. "This is important because we have a huge delivery area."

POS Adds Ease to the Operation          

Andrew added a POS system from Rockland Technologies about four years ago.
"When we were at $700,000 in sales a year, handwriting the tickets became a nightmare," Andrew says. "We literally had to have five to six tickets to deliver to the different sections of the kitchen area. The investment in the system is as well spent as advertising dollars.          

The system decreased delivery times and made us look more professional." The POS system is used to recognize customers, store credit card numbers, and customers' likes/dislikes. Another plus, Andrew says, is there are no arguments about discounts.          

"The POS system is a marketing tool in reverse," Andrew says. "We are not able to use it to figure out which areas to market to because of the high turnover in residents. The product of the POS is customer satisfaction. We have a 99.9 percent customer satisfaction rate."

Looking to the Future          

Andrew knows expansion to more than one locations is in his future, but not immediate. "We are thinking about expansion," Andrew says. "The main thing with that is to get the main store to full potential. We want to make sure the second store starts on a firm foundation. The second one either establishes you or puts you out of business. We want to stay in business."