Why the Country Lost Its Appetite for Pizza Hut
Once, Pizza Hut was the go-to for families and friends to indulge in its all-you-can-eat buffet, help-yourself greens station, and self-serve ice-cream.
However fewer patrons are visiting the restaurant currently, and it is closing half of its UK outlets after being rescued from insolvency for the second occasion this calendar year.
“We used to go Pizza Hut when I was a child,” notes Prudence. “It was like a family thing, you'd go on a Sunday – spend the whole day there.” However, at present, aged 24, she states “it's not a thing anymore.”
In the view of young customer Martina, the very elements Pizza Hut has been known and loved for since it started in the UK in the mid-20th century are now not-so-hot.
“How they do their all-you-can-eat and their salad station, it appears that they are cheapening on their quality and have reduced quality... They provide so much food and you're like ‘How can they?’”
As food prices have risen sharply, Pizza Hut's buffet-style service has become increasingly pricey to run. Similarly, its locations, which are being cut from over 130 to 64.
The company, similar to other firms, has also experienced its expenses increase. Earlier this year, staffing costs rose due to increases in the legal wage floor and an rise in employer taxes.
A couple in their thirties and twenties explain they used to go at Pizza Hut for a date “from time to time”, but now they order in another pizza brand and think Pizza Hut is “not good value”.
According to your selection, Pizza Hut and Domino's rates are comparable, says a food expert.
Although Pizza Hut provides takeaway and deliveries through delivery platforms, it is falling behind to big rivals which solely cater to off-premise dining.
“Another pizza company has succeeded in leading the off-premise pizza industry thanks to aggressive marketing and constantly running deals that make consumers feel like they're saving money, when in reality the original prices are quite high,” notes the expert.
Yet for these customers it is worth it to get their special meal delivered to their door.
“We absolutely dine at home now instead of we eat out,” explains the female customer, reflecting current figures that show a decrease in people frequenting quick-service eateries.
In the warmer season, quick-service eateries saw a notable decrease in customers compared to the year before.
There is also a further alternative to ordered-in pies: the frozen or fresh pizza.
An industry leader, senior partner at a leading firm, notes that not only have grocery stores been offering good-standard ready-to-bake pizzas for a long time – some are even selling countertop ovens.
“Evolving preferences are also playing a factor in the popularity of casual eateries,” states the analyst.
The rising popularity of protein-rich eating plans has increased sales at poultry outlets, while reducing sales of dough-based meals, he adds.
Since people visit restaurants not as often, they may prefer a more upscale outing, and Pizza Hut's classic look with comfortable booths and red and white checked plastic table cloths can feel more retro than upmarket.
The rise of artisanal pizza places” over the last decade and a half, such as boutique chains, has “fundamentally changed the public's perception of what good pizza is,” says the culinary analyst.
“A light, fresh, easy-to-digest product with a carefully curated additions, not the overly oily, dense and piled-high pizzas of the past. This, in my view, is what's caused Pizza Hut's struggles,” she comments.
“Who would choose to spend £17.99 on a tiny, mediocre, unsatisfying pizza from a chain 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.”
A mobile pizza vendor, who owns a small business based in a regional area explains: “It's not that fallen out of love with pizza – they just want higher quality at a fair price.”
Dan says his flexible operation can offer premium pizza at reasonable rates, and that Pizza Hut had difficulty because it could not keep up with evolving tastes.
At an independent chain in a UK location, the founder says the pizza market is diversifying but Pizza Hut has not provided anything new.
“You now have by-the-slice options, London pizza, New Haven-style, sourdough, wood-fired, Detroit – it's a heavenly minefield for a pizza enthusiast to discover.”
He says Pizza Hut “needs to reinvent itself” as younger people don't have any sense of nostalgia or loyalty to the company.
Over time, Pizza Hut's customer base has been fragmented and allocated to its more modern, agile alternatives. To maintain its expensive staffing and restaurants, it would have to raise prices – which experts say is challenging at a time when household budgets are shrinking.
The managing director of Pizza Hut's international markets said the acquisition aimed “to ensure our customer service and protect jobs where possible”.
The executive stated its immediate priority was to maintain service at the surviving locations and takeaway hubs and to assist staff through the transition.
But with large sums going into running its restaurants, it may be unable to spend heavily in its takeaway operation because the market is “complicated and partnering with existing external services comes at a price”, analysts say.
But, he adds, cutting its costs by exiting competitive urban areas could be a effective strategy to adapt.