How the Country Turned Away from Its Craving for Pizza Hut
In the past, the popular pizza chain was the favorite for families and friends to feast on its all-you-can-eat buffet, unlimited salad bar, and ice cream with toppings.
However fewer customers are frequenting the restaurant nowadays, and it is closing 50% of its UK restaurants after being bought out of administration for the second time this calendar year.
I remember going Pizza Hut when I was a child,” says one London shopper. “It was a regular outing, you'd go on a Sunday – make a day of it.” However, at present, in her mid-twenties, she says “it's fallen out of favor.”
For a diner in her twenties, some of the very things Pizza Hut has been famous for since it opened in the UK in the mid-20th century are now less appealing.
“How they do their buffet and their salad station, it appears that they are cheapening on their quality and have reduced quality... They offer so much food and you're like ‘How is that possible?’”
Since food prices have soared, Pizza Hut's unlimited dining format has become very expensive to operate. As have its outlets, which are being cut from 132 to 64.
The company, like many others, has also experienced its operating costs increase. This spring, employee wages increased due to increases in the legal wage floor and an rise in employer taxes.
A couple in their thirties and twenties say they used to go at Pizza Hut for a date “from time to time”, but now they get delivery from another pizza brand and think Pizza Hut is “too expensive”.
Depending on your order, Pizza Hut and Domino's rates are comparable, says a food expert.
Even though Pizza Hut has takeaway and deliveries through delivery platforms, it is missing out to larger chains which solely cater to this market.
“Domino's has taken over the off-premise pizza industry thanks to strong promotions and ongoing discounts that make shoppers feel like they're finding a good deal, when in reality the original prices are quite high,” explains the specialist.
But for Chris and Joanne it is justified to get their special meal delivered to their door.
“We absolutely dine at home now instead of we eat out,” comments one of the diners, matching latest data that show a decline in people going to quick-service eateries.
During the summer months, casual and fast-food restaurants saw a six percent decline in customers compared to last summer.
Moreover, one more competitor to pizza from eateries: the supermarket pizza.
Will Hawkley, senior partner at a major consultancy, points out that not only have supermarkets been providing high-quality prepared pies for a long time – some are even selling countertop ovens.
“Shifts in habits are also playing a factor in the popularity of fast-food chains,” states Mr. Hawkley.
The increased interest of low-carb regimens has boosted sales at grilled chicken brands, while affecting sales of carb-heavy pizza, he continues.
As people visit restaurants less frequently, they may look for a more high-quality meal, and Pizza Hut's American-diner style with booth seating and traditional décor can feel more dated than upmarket.
The “explosion of high-quality pizzerias” over the last decade and a half, including popular brands, has “completely altered the public's perception of what good pizza is,” explains the industry commentator.
“A light, fresh, easy-to-digest product with a carefully curated additions, not the massively greasy, heavy and overloaded pizzas of the past. That, I think, is what's caused Pizza Hut's decline,” she says.
“Who would choose to spend a high price on a tiny, mediocre, unsatisfying pizza from a franchise when you can get a beautiful, masterfully-made 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 runs a pizza van based in Suffolk says: “People haven’t fallen out of love with pizza – they just want better pizza for their money.”
Dan says his flexible operation can offer premium pizza at accessible prices, and that Pizza Hut faced challenges because it was unable to evolve with evolving tastes.
At an independent chain in a UK location, the proprietor says the sector is diversifying but Pizza Hut has failed to offer anything new.
“There are now by-the-slice options, London pizza, new haven, artisan base, Neapolitan, Detroit – it's a heavenly minefield for a pizza enthusiast to try.”
Jack says Pizza Hut “should transform” as younger people don't have any fond memories or loyalty to the company.
Over time, Pizza Hut's market has been sliced up and allocated to its fresher, faster rivals. To maintain its costly operations, it would have to raise prices – which industry analysts say is difficult at a time when family finances are shrinking.
The leadership of Pizza Hut's overseas branches said the rescue aimed “to safeguard our guest experience and save employment where possible”.
The executive stated its immediate priority was to maintain service at the open outlets and delivery sites and to help employees through the change.
However with large sums going into operating its locations, it may be unable to allocate significant resources in its takeaway operation because the industry is “complex and working with existing external services comes at a expense”, commentators say.
Still, experts suggest, cutting its costs by exiting oversaturated towns and city centres could be a effective strategy to adapt.