Pizza 73: On the Radar
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By Kathryn Jones   
Tuesday, 26 February 2008
smc Pizza 73, a leading Canadian pizza franchise, says it has enjoyed several industry firsts.
Pizza 73, a leading Canadian pizza franchise, says it has enjoyed several industry firsts.
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Pizza 73 has several reasons to commemorate its good fortune. The company has enjoyed steady growth since it was founded in Edmonton, Alberta, Canada in 1985. Today, the franchise has 57 locations, with 27 in Edmonton, 17 in Calgary, Alberta, three in Saskatchewan and one just across the British Columbia border. The remainder reside in small-town markets of 50,000 or less people, Vice President Dale Moran says.

Moran, Guy Goodwin and David Tougas had been involved together in other restaurant operations for several years. They wanted to use the same two-for-one marketing promotion that had been successful in their other restaurants and implement it in a can’t-miss market – pizza. “We opened a test store across the street and were encouraged by the results, so we immediately opened nine more locations,” Moran recalls.

The three could open up multiple locations quickly because they opted to become a joint venture with each franchisee.

“We wanted to own more equity that comes with being a franchise, but we didn’t want to have to worry about the company managers being there late at night,” Moran explains. “So, for every location we opened after the first one, we own half and the operating owner owns the other 50 percent.

“This allowed us to focus on corporate functions, advertising, payroll and the ordering of goods, and that left our partners free to concentrate on staff training and putting a great product on the market,” he adds. “The joint venture system has worked well for us and for our partners. As we made money, each of those partners made money. We have some very wealthy store owners and we’re proud of that.”

Standing Apart
Aside from its unique franchising model, Pizza 73 stands apart from other pizza restaurants for other reasons, Moran notes. First, its two-for-one concept was introduced to the market at a time when giving a free pizza away with every order was virtually unheard of in Canada.

“When we first came in, we had two sizes – nine inches and 12 inches – so that’s giving you more product,” he says. “We also developed a unique double-decker box. It’s a normal pizza box, but twice as high. You put one pizza on top of the other by inserting a shelf over the top of the bottom pizza. You knew it was a Pizza 73 pizza from the dimensions of that box.”

The company also has an unusual way of accepting delivery orders. It uses a universal call system, where customers across Alberta call the same number.

“If we have 10 different restaurants in the same area, customers don’t have to dial 10 different numbers,” Moran says. “Instead, they are connected to a call center. The computerized system in the call center becomes a single focus for us.

“Each order has its own unique barcode that is printed out on a laser printer. When we make that order, we pass it by a barcode scanner and that feeds back to the call center, so we know when the order is in. If the customer calls and we need to make a change on the product, we can properly advise them. We pass it through the barcode scanner one more time when it goes out to the driver. This way, we can accurately tell the customer when the order has been made, when it has made its way into our oven or when it’s with the driver.”

Pizza 73 is in the process of putting all of this information on the Web. “If you order through the call center, you can go online and follow your pizza from the time you ordered it to the time it leaves the shop,” Moran explains. “We’re looking at rolling that out in the next 12 to 24 months.”

On to New Things
Tougas, Moran and Goodwin meshed well as leaders, Moran says. Goodwin came with an accounting background, Moran was skilled in operations and was in charge of menu and processes, and Tougas was active in the company’s marketing and advertising. In 1995, Tougas decided to pursue other interests, so Moran and Goodwin acquired his shares.

“In the first 15 years, we wanted to put our heads down and be under everyone’s radar,” Moran recalls. “But as we became larger, we wanted to do business with other companies, so we made ourselves more open to people, and experienced good growth.” Last year, Pizza 73 was voted one of the 50-best managed companies in Canada by Deloitte & Touche.

In addition, Goodwin and Moran were recognized as Entrepreneurs of the Year by Ernst & Young. However, like Tougas, Goodwin and Moran have decided to pursue other interests. In July, they sold their shares to Toronto, Ontario-based Pizza Pizza, which is the largest pizza company in Canada, Moran says. The two will remain at the company as part of a one-year management contract.

Getting the attention of the largest pizza company in the country was an accomplishment for Goodwin and Moran. They are pleased with their decision to leave the business. Pizza Pizza also has an aggressive coast-to-coast business growth plan and wants to continue to open more Pizza 73s in Alberta, where the company is well-recognized.
    
“So, we have the end of our era,” Moran notes. “In the 20 years we’ve been at the helm, we were the face of what happened, but there are 800 other people working in the company and we’re proud of what we have achieved together.”
 
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