Hot Concepts 2012: Pie Five Pizza Co.

The Hot Concepts awards are given each year by Nation’s Restaurant News to young, growing chains that embody the perseverance and entrepreneurial spirit of the restaurant industry. Here, we profile one of the four 2012 Hot Concepts award winners.

Pizza Hut pioneered the five-minute pizza a quarter century ago with the introduction of its Personal Pan offering. The problem was, much like Henry Ford’s “black only” Model T, toppings options were limited, and pizzas were premade and held in hot boxes to make for speedy lunch turns.

That’s all changed with Pie Five, the mini-chain sibling of Pizza Inn, based in The Colony, Texas. Quick customization is the core of this fast-casual concept, which serves a menu of 11 specialty personal pizzas alongside the option to customize one with 21 toppings, seven sauces, two crusts and four cheeses.

Seven units already have opened in 15 months, proving that Pie Five has traction, said Dave Ostrander, a pizza operations and marketing consultant. He said he’s surprised no one moved on this option earlier “because it’s a knockoff of what happened one generation ago at Pizza Hut. But where it’s not a knockoff is in the Subway-style format. Customers get to look at their choices, have it their way and get it quick.”

The quest for speed was the seed idea that led Pizza Inn officials to create Pie Five, said interim chief executive Clinton Coleman. In late 2010 Pizza Inn was testing ways to accelerate their fresh-dough baking procedures. During that process they stumbled onto ideas for a completely new concept that would claim a wedge of the modest fast-casual pizza subsegment. Their tests taught them they could make pizza quickly, always to order and to each customer’s preferences.

While Pizza Inn’s buffet operations had a foothold in secondary markets, it was determined the new concept would thrive in larger markets where fast-casual restaurants already are part of the dining culture.

“It also had to be high quality to match fast-causal competitors’ quality,” said Coleman. “When you see a lunch hour at a busy unit, you see our throughput and our ability to maintain quality, which is what sets us apart.”

According to Madison Jobe, senior vice president and chief development officer at Pie Five and Pizza Inn, the key to such quick turnaround is dough made fresh throughout the day and parbaked just before and during service.

“We have thin and thicker crust options, so parbaking allows us to equalize their final cooking times,” Jobe said. “The parbake takes about a minute, just long enough to suspend yeast activity.”

Each unit averages 2,200 square feet, seats about 75 and costs around $400,000 to build, Jobe said. He declined to estimate the return on such an investment.

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For now, Pie Five units are corporate owned, but Coleman predicted half of the chain’s units will eventually be franchised to veteran operators in established large markets. He expects Pie Five will best maximize brand awareness and advertising efficiencies at about 10 units per metropolitan statistical area.

“Even though it’s still a young concept, I’m very pleased with its early life cycle,” Coleman said, predicting that Pie Five will finish 2012 with 10 units. “We got a lot of things correct right off the bat, but we’re also learning a lot as we open each new store.”

That Pie Five has the backing of the 53-year-old, 300-unit Pizza Inn chain hasn’t hurt either, he added.

“When you’ve got that kind of infrastructure to draw on, you move much faster than if yours was purely a start-up company,” he said.

Ostrander said he has not had the chance to try Pie Five but plans to soon. The entire operational model makes sense to him, and he believes customers will love the benefits of speed and choice.

But when it comes to pizza, he noted, “the acid test is whether the pizza is actually good or whether it’s garbage. You can’t do garbage when there are so many good options out there. But if it’s really good, you’ll have a superstar. And it sounds like they’ve got a winner.”