Why the Country Lost Its Craving for the Pizza Hut Chain
Once, Pizza Hut was the favorite for groups and loved ones to indulge in its eat-as-much-as-you-like offering, unlimited salad bar, and ice cream with toppings.
But not as many customers are frequenting the restaurant these days, and it is reducing half of its British locations after being rescued from insolvency for the second occasion this year.
It was common to visit Pizza Hut when I was a child,” explains one London shopper. “It was a tradition, you'd go on a Sunday – spend the whole day there.” Today, in her mid-twenties, she states “it's not a thing anymore.”
In the view of young customer Martina, certain features Pizza Hut has been recognized for since it opened in the UK in the 1970s are now outdated.
“The manner in which they do their buffet and their salad station, it feels like they are cheapening on their quality and have lower standards... They're giving away so much food and you're like ‘How is that possible?’”
Since grocery costs have increased significantly, Pizza Hut's all-you-can-eat model has become quite costly to maintain. As have its locations, which are being reduced from over 130 to 64.
The company, similar to other firms, has also faced its operating costs rise. Earlier this year, employee wages jumped due to increases in the legal wage floor and an rise in employer national insurance contributions.
Two diners mention they frequently dined at Pizza Hut for a date “occasionally”, but now they get delivery from Domino's and think Pizza Hut is “not good value”.
Based on your selection, Pizza Hut and Domino's prices are comparable, explains an industry analyst.
Although Pizza Hut does offer pickup and delivery through third-party apps, it is losing out to big rivals which focus exclusively to off-premise dining.
“Domino's has taken over the off-premise pizza industry thanks to strong promotions and ongoing discounts that make consumers feel like they're saving money, when in reality the original prices are on the higher side,” explains the analyst.
However for these customers it is acceptable to get their special meal delivered to their door.
“We definitely eat at home now rather than we eat out,” says one of the diners, echoing recent statistics that show a decrease in people frequenting informal dining spots.
In the warmer season, casual and fast-food restaurants saw a notable decrease in diners compared to the year before.
There is also a further alternative to restaurant and takeaway pizzas: the supermarket pizza.
Will Hawkley, head of leisure and hospitality at a major consultancy, notes that not only have supermarkets been providing premium prepared pies for years – some are even promoting pizza-making appliances.
“Lifestyle changes are also playing a factor in the success of casual eateries,” comments Mr. Hawkley.
The growing trend of high protein diets has boosted sales at chicken shops, while affecting sales of high-carbohydrate options, he continues.
Since people visit restaurants less frequently, they may prefer a more high-quality meal, and Pizza Hut's classic look with comfortable booths and nostalgic table settings can feel more retro than upmarket.
The “explosion of premium pizza outlets” over the last 10 to 15 years, such as new entrants, has “completely altered the consumer view of what quality pizza is,” notes the food expert.
“A crisp, airy, digestible pizza with a select ingredients, not the massively greasy, heavy and overloaded pizzas of the past. That, arguably, is what's resulted in Pizza Hut's decline,” she comments.
“What person would spend £17.99 on a small, substandard, disappointing pizza from a franchise when you can get a stunning, expertly crafted Margherita for under a tenner at one of the many authentic Italian pizzerias around the country?
“The decision is simple.”
A mobile pizza vendor, who operates Smokey Deez based in Suffolk explains: “It's not that fallen out of love with pizza – they just want improved value.”
The owner says his mobile setup can offer premium pizza at affordable costs, and that Pizza Hut struggled because it was unable to evolve with evolving tastes.
According to Pizzarova in a city in southwest England, owner Jack Lander says the sector is diversifying but Pizza Hut has failed to offer anything new.
“There are now slice concepts, London pizza, thin crust, fermented dough, traditional Italian, deep-dish – it's a wonderful array for a pizza-loving consumer to explore.”
He says Pizza Hut “should transform” as newer generations don't have any emotional connection or attachment to the chain.
Over time, Pizza Hut's customer base has been divided and spread to its trendier, more nimble competitors. To keep up its expensive staffing and restaurants, it would have to increase costs – which commentators say is difficult at a time when household budgets are tightening.
The managing director of Pizza Hut's global operations said the rescue aimed “to ensure our dining experience and protect jobs where possible”.
It was explained its first focus was to maintain service at the remaining 64 restaurants and delivery sites and to assist staff through the change.
But with large sums going into operating its locations, it may be unable to spend heavily in its delivery service because the sector is “difficult and working with existing external services comes at a expense”, analysts say.
But, he adds, reducing expenses by withdrawing from crowded locations could be a good way to evolve.