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Pizza Hut Essay

Pizza Hut Essay

PIZZA HUT was established on June 15 1958 in wichita university campus, wichita, kansas by two brothers FRANK and DAN CARNEY. The brothers had the concept of opening a pizza parlour which was relatively new during the 1950s and the potential of this business was seen by the two. They borrowed around six hundred dollars from their mother to buy second-hand equipments, machineries and rent a small space to open the first Pizza Hut. The next year, the second store was opened in Topeka, Kansas and within a decade Pizza Hut reached three hundred and ten Pizza parlours in various locations serving approximately a million people.

In the year 1970, Pizza Hut already had 5,025 branches in the united states alone with half of it franchised. During the same year , the company in 1986 alone amounted to $2 billion. In the years 1990, the total sales of Pizza Hut reached $4 billion world wide. By the year 1996, the sales in the domestic market which is the United States, have reached over $5 million; the company had the largest share of the market in the same year for 46.

4%. in the year 1998, Pizza Hut launched their campaign, “The Best Pizzas under one roof”, in celebration of the company’s 40th anniversary. COMPANY OVERVIEW:

Pizza Hut operates in ninety seven countries throughout the world. As of 2008, Pizza Hut had 7,564 units in the united states and 5,611 units outside the united states (source: Data moniter). Pizza Hut(UK), a privately held company, specialized in the operation of pizza restaurants and takeaways. Pizza Hut(UK) is a subsidiary of United states based Yum! Brands. The company primarily operates in the UK, with the Pizza Hut brand operating worldwide. Its headquartered in Borehamwood, UK. BUSINESS DESCRIPTION: Pizza Hut (UK) specialized in the operation of pizza restaurants and takeaway services.

The company operates in four distinct categories of menus: restaurant menu, children’s menu, collection menu, delivery and take-away menu. MAIN MENU: Pizza Hut (UK) restaurant menu includes pizzas; starters and sides; pastas; salad station and salads; lunch buffet and light lunch; desserts, and drinks. The children’s menu includes pizza triangles, delicious margherita pizza, desserts, drinks and buffet. KEY EMPLOYEES: MAJOR PRODUCTS AND SERVICES: The company’s key products and services include the following: Big New Yorker Pizza. Quad Pizza. The Edge Pizza.

Stuffed Crust Pizza. Grand Pan Pizza. Sicilian Pizza. Italian Pizza Twisted Crust Pizza. 4 For All Pizza. Pastas. Buffets. Cheesy Bites. Stuffed Crust. SERVICES: Full service restaurants Delivery and Take-Away service. PIZZA HUT SYMBOL: {draw:frame} PIZZA HUT MISSION STATEMENT: We take pride in making a perfect pizza and providing courteous and helpful service on time all the time. Every customer says, “I”ll be back! ”. We are the employer of choice offering team members oppurtunities for growth, advancement, and rewarding careers in a fun, safe working environment.

We are accountable for profitability in everthing we do, providing our shareholders with value growth. CORE VALUES: P. E. A. L. S. PASSION for excellance in doing everthing EXECUTE with positive energy and urgency. ACCOUNTABLE for growth in customer satisfaction and profitability. RECOGNIZE the achievement of others and have fun doing it. LISTEN and more importantly, respond to the voice of the customer. MAJOR COMPETITORS: Domino’s Pizza, Inc. Papa John’s International, Inc. McDonald’s Corporation ACHIEVEMENTS: {text:list-item} In 1986 Pizza Hut introduced delivery service, which played a vital role in the career of Pizza Hut.

Out of all existing Pizza chains, Pizza Hut had the largest market share, 46. 4%. However, Pizza Hut’s market share has slowly eroded because of intense competition from their rivals of Domino’s and other fast food take away restaurants. These competitors alway look forward to enhance their customer numbers. Also, many other Pizza chains started to diversify and offer new non-pizza items such as buffalo wings, and italian cheese bread in order to increase their varieties and to increase the buyer power. The current chain in the Pizza chain is the same till today.

All these Pizza supply chain try to come up with some newer, bigger, better and Pizza for comparatively low price. These chains are also strengthened new Pizza variations. For example, chicken is now a common topping found on Pizza’s. {draw:frame} A 1-800 number customer hotline and A customer call-back program. WHERE DO THEY BUY* ? WHY DO THEY BUY PIZZA* ? {text:list-item} Employing economies of scale, Pizza Hut has made its offering more affordable. Its delivery offer for four personal pan pizzas has been very successful, which helped the business to grow by 25%.

The Pizza Hut recently launched a range of vegetarian personal pan pizza’s at very nominal and affordable price. Pizza Hut consolidating its position by opening more restaurants in the big cities where it already has the presence. {draw:frame} {text:list-item} {text:list-item} Though Pizza Hut have low competition, although they do have competitors such as dominos pizza, yet they have an advantage over these as Pizza Hut are the restaurant as well as take away unlike dominos pizza, this results Pizza Hut may have more sales therefore more income.

Pizza Hut has a very strong market segment, they attract more customers by providing different varities, new products and tastes very often which leads increasing customer numbers and a higher percentage in sales, which may lead to greater profits. The major strength’s of the Pizza Hut are as follows: Pizza Hut is very strong in its financial situation and international turnover. Thus, it is good to manage its chain in the period of recession. Pizza Hut is BRAND LEADER in the united kingdom. Pizza Hut has good balance in its business over twenty thousand franchises around the world.

It is also the part of the largest chain restaurant in the world. Since, it provides a skeletal structure to the fast food industries and services. Innovative range of Pizza’s under one roof. It is purely owned by YUM!. Pizza Hut is lacking with its varied range of products to attract customers of all lifestyles. There are complex computer systems and internal conflicts from franchisees, this may drive to de-motivation of staff. Lowering the quality of products, services to the customers and could lead to a lack of ideas.

One of the major issue presented in developing a profitable delivery concept was whether there would be a charge for service taking into account that, for competitive reasons, as the company cannot charge for its delivery. This lead the company to increase its price slightly over pizza’s in traditional restaurants. This caused dissatisfaction for the customers. Since, they would pay 10% more for any size of pizza’s. The management also included that, the franchisees must also increase the size of the pizza as they could find the profit from the 10% additional price.

But, this wasn’t a fare idea by the top management because the franchisees strongly disagreed with this concept and they find no reasons for delivery and increasing the size of the Pizza. There was major arguement between company and the franchisees, which was solved by providing some incentives by the company. Oppurtunities: The main oppurtunities of the Pizza Hut includes: Market share. Pizza home delivery. Growth into new market. Always looking at consumer satisfaction. Pizza Hut can readily grow in any other markets because it has cohesive and well structured organisation.

Pizza Hut also holds a very strong market share. Pizza Hut has expanded its menu in indian market. Pizza Hut has targeted upscale products and a downscale consumer base; this would increase the sales and the revenue of the company. THREATS: There are various threats to the Pizza Hut as it should know more about its customer’s tastes. It should also carry some research to judge the company and its competitors on reputation, product quality, service, strength and price. Pizza Hut must also analyse about the buying decisions of the customers. Domino’s Pizza clearly intanded to gain total market leadership.

So, Pizza Hut should try to maintain its position over its competitors. Pizza Hut improve its customer’s loyality quotient as it is comparitively low from its competitor’s. It is a truism to say that it is much more difficult to capture or recapture a customer than to maintain an existing one. Rising in the competition undermines Pizza Hut as consumers go for greater convenience. This would result in decreasing the sales of the Pizza Hut as these sales will switch to smaller companies who are offering their products at lower price. Increase in the cost of ingrediants especially cheese could threaten the margin of the company revenue.

EXTERNAL ENVIRONMENTAL CONTEXT: It is very important to consider the external environment research for PIZZA HUT. Since, these external changes could drive the company to difficulties. These external environmental context will include PEST analysis which stands for political, environmental, social, technology, which determines the impact of the drivers in the company. P. E. S. T. ANALYSIS: POLITICAL: The political analysis of the Pizza Hut contains health and safety guidelines, labelling of GM (genetically modified) food, animal rights campigns, Bovine spongiform encephalopathy-1998 BRANDING STRATEGY:

STRENGTH OF BRAND: A brand is the media between consumers and the company. The promise of the brand always reflects in the mind of the consumers. A strong brand can shape the way consumers think and can create preference in the market place. Following certain principles and behaviours, organisations can strengthen their brands by consistently delivering on their brand promise and making powerful connections with the consumers. Pizza Hut is a International brand reaches over 100 countries. Though other fast food markets maintains the flexibility to respond to the needs of its consumers.

Pizza Hut consider the consistent look as a whole and feel for every restaurant. This driven Pizza Hut to be a one of the leading brands. STRENGTH OF SYMBOL AND LOGO: ROLE OF THE CUSTOMER: What people eat(or don’t eat) has always been determined by a complex interplay of social, economic and technological processes (schlosser, 2001). These explanation of the schlosser gives a clear picture of why the consumer makes a purchase. The consumer is identified by a being complexly psychological and on the most part illogical. THE THREE LEVELS OF EXPLANATION OF BUYING AND CONSUMPTION BEHAVIOUR (Dubois, 2000). {draw:text-box}.

{draw:text-box} {draw:text-box} Dubois makes the observation that “people who are hungry notice advertising for food products”. This contention is supported when an example is given; “In the united states, the television campaign ‘ARE YOU HUNGRY ? ’ which was broadcast late at night by burger king was so successful that it forced the hamburger chain to stay open later” (Dubois, 2000). So, according to this paper narrates that, it is determined that mid-night advertisements for the delivery service or take-away food centres is advisable and consumers tend to attract more towards food products when they are hungry.

The reliant on the natural human wants created by hunger. It is hoped that this review when coupled with the findings from the survey will give the debate, depth, purpose and concluding definition. RECOMMENDATIONS: The implement of ORGANIC PIZZA’S may increase the target market and enhance the buyer’s power. The consideration of cultural ethics is important when a new branch of Pizza Hut is launched in other countries. Pizza Hut can develop MEALDEAL as rest of the competitors offer. Example: MCPIZZA. In order to compete with its external environment.