Pizza Patrón Suspends Franchise Sales, Ramps Up Growth

posted on January 21st 2014 /

Pizza Patrón plans to heighten standards and tighten focus

DALLAS  — January 8, 2014 – After ten years of franchising, Pizza Patrón announced today that it is suspending its franchise program indefinitely.  The company will continue development with some of its existing franchise partners, but will concentrate its growth focus on building company owned stores.

Company officials say the decision was made to ensure high company standards from store to store – the standards of operation, the quality of the products and service, improved marketing execution and more efficient policing of Pizza Patrón’s branding and trademarks.

“We are proven and successful operators of the Pizza Patrón model,” said Antonio Swad, founder of Pizza Patrón. “I think we understand how to maximize its potential better than most.”

Swad went on to point out the value of successfully growing a brand and owning a unique position in the marketplace – that great branding always reveals a company’s personality and makes a promise that it must strive to fulfill with every customer experience.

Pizza Patrón gained notoriety and international media attention for its non-traditional approach to marketing its products.  In 2007, Pizza Patrón launched PIZZA POR PESOS® allowing customers to pay for their pizza using Mexican pesos, making the brand a flashpoint in the nation’s debate over immigrants.  More recently, Pizza Patrón reaped national news coverage for its PIZZA POR FAVOR® promotion that rewarded customers with free pizza if they ordered in Spanish.

“As Pizza Patrón moves ahead, we will continue to sharpen our brand and increase its relevance in the marketplace,” Swad explained.

Swad acknowledges that going forward, the company will also consider entering into certain licensing agreements with companies that have access to special outlets like national grocery chains, major food services corporations, airport locations, college and university campuses and hospitals.

 

About Pizza Patrón

Since 1986, Pizza Patrón has been committed to making its promise of “Más Pizza. Menos Dinero.®” a reality for every customer.  From the beginning, the brand has been recognized for its ‘fresh-dough’ pizza, its low prices and its trademark “friendly, bicultural service.”  In 2007, the company drew international media attention with its PIZZA POR PESOS® program when it began accepting Mexican Pesos at all of its restaurants.  In 2012, the company’s PIZZA POR FAVOR™ promotion that gave free pizzas to anyone who ordered in Spanish sparked international news coverage and lively debate throughout the U.S.  Today, Pizza Patrón is the leading Mexican pizza brand in the U.S. and remains dedicated to bringing its unique experience to life with every pizza made, and in every community it serves.

Website – www.pizzapatron.com

Facebook – http://www.facebook.com/pizzapatron

Twitter – http://www.twitter.com/pizzapatron

Pizza Patrón Closes 20% of its Stores, Sets Sales Record

posted on January 17th 2014 /

DALLAS  — January 17, 2014 – Pizza Patrón said today that despite closing nearly 20 percent of its stores in 2013, it achieved the highest overall yearly sales in the company’s history.

Pizza Patrón opened seven new restaurants and closed 20 locations in multiple markets in 2013.  Although the company is forecasting that a handful of additional locations will close in 2014, executives say the company expects to finish this year with 25 new stores – over 30 percent growth above the current store count.

“Suspending our franchise sales program has allowed us to become a restaurant company again.  We are focused on two things – food and people,” said Antonio Swad, founder of Pizza Patrón. “By closing some of our most poorly operated stores and purging the system of our least engaged operators, we are now able to concentrate our focus on the fundamentals of our restaurant business.”

Swad, founder and CEO of the Mexican pizza chain, recently took over the role of company president.  Since taking the helm, Pizza Patrón’s staff has been reduced by more than 30 percent, a new store development model has been initiated and a narrowed brand focus has been triggered.

“I believe Pizza Patrón is more relevant now than ever,” said Swad.  “We have a very focused brand that also has extremely broad appeal.  It’s a great position to be in only if you can execute at a high level. We are moving forward with a great group of talented and committed franchisees.  In addition, we are building company-owned stores for the first time in our history.  I am confident that this will be a huge year for Patrón.”

Swad is encouraging remaining franchisees and managers to focus on the company’s efforts to strengthen its business for the long term.  “We believe all the steps we are taking will pay off in the long run,” Swad said. “And, we feel very good about the progress we have made so far.”

Swad also acknowledged that as part of its new efforts to grow the brand, Pizza Patrón Inc. will entertain licensing agreements with companies who have access to special outlets like national grocery chains, major food services corporations, airport locations, college and university campuses, and hospitals.

About Pizza Patrón

Since 1986, Pizza Patrón has been committed to making its promise of “Más Pizza. Menos Dinero.®” a reality for every customer.  From the beginning, the brand has been recognized for its ‘fresh-dough’ pizza, its low prices and its trademark “friendly, bicultural service.”  In 2007, the company drew international media attention with its PIZZA POR PESOS® program when it began accepting Mexican Pesos at all of its restaurants.  In 2012, the company’s PIZZA POR FAVOR™ promotion that gave free pizzas to anyone who ordered in Spanish sparked international news coverage and lively debate throughout the U.S.  Today, Pizza Patrón is the leading Mexican pizza brand in the U.S. and remains dedicated to bringing its unique experience to life with every pizza made, and in every community it serves.

Website – www.pizzapatron.com

Facebook – http://www.facebook.com/pizzapatron

Twitter – http://www.twitter.com/pizzapatron

Pizza Patrón slices franchising operation, preps for growth

posted on January 16th 2014 /

By KAREN ROBINSON-JACOBS
Staff Writer
krjacobs@dallasnews.com

 

A worker at the Pizza Patrón on busy Buckner Boulevard retrieves two ready-to-go pizzas from a warming oven, hands them to a hungry diner and calls out “lista,” the Spanish word for ready.

It’s a signal to the cook that more no-wait pizzas are needed.

It’s also the state in which the chain’s founder, Antonio Swad, finds himself.

Last year Swad mothballed Pizza Patrón’s franchise recruiting operation and closed 20 underperforming locations. More than a dozen franchisees have left the system, some with hard feelings.

Now, Swad says he’s ready to move into the chain’s next phase. It’s planning to open company-owned locations for the first time.

“The reasons that we made the decisions we made are solid,” said Swad, who leads a Latin-themed business but speaks only poquito Spanish. “We’re a company that’s really on the move.”

Founded in 1986 in Pleasant Grove, Pizza Patrón is not subtle about courting its core customer. The motto is in Spanish: “Más Pizza. Menos Dinero” (More Pizza. Less Money).

The Dallas-based chain, which now has 89 locations, mostly in Texas, sparked a firestorm of controversy in 2007 when it allowed customers to pay with Mexican pesos.

Swad followed that gambit in 2012 with a “pizza por favor” promotion that gave free pizzas to anyone who ordered in Spanish.

As hundreds lined up for free food, Internet posters lobbed angry comments that inevitably led to a debate about immigration.

Pizza Patrón’s radio ads are solely focused on the Mexican-American audience. They are laced with Mexican alburear, or humor, said Andrew Gamm, the chain’s brand director.

And two-thirds of the franchisees — entrepreneurs who use their own funds — are Latino. Swad is not.

Over the past 10 years, the company grew from four locations, all owned by Swad, to more than 100. Of the 89 remaining locations, 79 are franchised and 10 are owned by Swad. About 35 are in Dallas-Fort Worth.

Franchising growth

Like the rest of the restaurant industry, Pizza Patrón owes its girth to franchising.

Among fast-food restaurants, which generally includes the pizza category, 13 percent of restaurants are company-owned, 46 percent are owned by franchisees, and the remaining 41 percent are independents, according to National Restaurant Association.

For the restaurant industry as a whole, franchising remains a popular growth model. It allows a brand to dramatically increase the number of locations without having to pay for their construction or upkeep.

The International Franchise Association, a trade group, estimates that there will be 155,571 franchised fast food restaurants and 36,981 franchised full-service, sit-down restaurants operating in the U.S. this year. That makes restaurants the largest category in franchising.

Among franchised outlets, business services (such as tax preparation), commercial and residential services (including cleaning), and quick service restaurants are expected to see the strongest employment gains in 2014, according to a forecast released this week by the franchise association.

“It’s very rare to see a franchise restaurant brand convert to corporately owned restaurants,” said John Reynolds, president of the franchise association’s educational foundation.

“In most cases, it goes the other way, where a local or regional chain of corporately owned restaurants will decide to embark on franchising for a more rapid development of their brand and to gain more market share.”

Desire for change

But Swad, who also is chairman of Pizza Patrón and took over last year as president, wanted change.

“I noticed … that we were spending time on relatively unimportant things, attempting to build consensus among our franchisees on minor decisions, instead of putting our time and energy on developing a strategy to move the company forward,” he said as transactions took place in Spanish at the counter a few feet away.

For example, he said, it took months to get the franchisees behind the “pizza por favor” promotion, in part over unhappiness that they would bear the cost.

“We spent time and energy on this ‘get on board’ process instead of the ‘let’s move forward’ process,” Swad said.

So last year, at least five franchisees left the system. Swad said it was “by design.”

What does “by design” mean?

“Without going into excruciating details: Franchisees have an obligation to maintain the brand to a standard; they need to operate their restaurants to a standard that was difficult for some. We’re committed at Pizza Patrón to raising our standards of operation higher than they’ve ever been.

“Sometimes when you raise the standard, not everybody is able to keep up,” he said.

Fewer franchisees

More franchisees left before last year. In 2008 there were 50. Now there are 32, and some probably won’t be around next year, Swad said. No more will be added for the foreseeable future.

The company closed out entire markets: El Paso (all six stores), Las Vegas (all six), Fresno (all three) and San Diego (both stores). All Dallas-Fort Worth stores remained open.

Pete Tucker, a restaurant industry veteran, closed the two San Diego stores because keeping them open “just didn’t make any sense” financially. Without the name recognition the brand has in Texas, and with the California pizza market already saturated, Tucker said he lost money on his two stores.

“We just could not make the business work in San Diego,” he said. “We don’t hold any bad will to Pizza Patrón.”

Another former franchisee asked that his name not be used because he may file a lawsuit. The company is not currently facing litigation, Swad said.

The second former franchisee agreed with Tucker that locations outside of Texas had a hard time generating enough sales to break even. Not counting Swad’s stores, many of the other locations were losing money, he said, and his loss was in the seven figures.

Record sales in ’13

Gamm said even with the store closures, the company posted record sales in 2013 of $39.4 million.

He said he has not heard of any filing for bankruptcy.

“We do have some terrific franchisees in this system that we’re happy to grow with,” said Swad, who also founded the Wingstop chicken wing chain.

With last year’s store closures behind him, Swad is planning for growth.

In 2013, seven locations opened — all franchised.

This year, 25 are expected to open: 15 corporate locations and 10 franchises, with 20 of those locations in Dallas-Fort Worth. The average cost for a strip mall location is $250,000. Money for the corporate locations will come from corporate coffers. Swad said he has not taken on any new investors.

“It’s a lot [to take on] in one sense. In another sense we’re speaking to our core competency,” said Swad, ducking into the kitchen to check on an order. “It’s an exciting challenge to have.

“We’re really amped up around here. We have a big year ahead of us.”

Follow Karen Robinson-Jacobs on Twitter at @krobijake.

Website – www.pizzapatron.com

Facebook – http://www.facebook.com/pizzapatron

Twitter – http://www.twitter.com/pizzapatron

Pizza Patrón Heats Up New Year with “Any 3 for $18” Promotion

posted on January 2nd 2014 /

DALLAS – Jan. 2, 2014 – Pizza Patrón is blazing into the New Year with an incredible deal for Pizza Patrón customers – for a limited time, they can get any three large pizzas for only $18.  That means customers can order three large pizzas with any toppings for $18.

Savvy pizza consumers are already very familiar with the “Any pizza for $10” deal advertised by many large pizza chains over the past few years.  To promote awareness of the Pizza Patrón’s “Favoritas del Patrón” line of specialty pizzas, and to boost sales of custom pies, Pizza Patrón is executing a limited time sampling program that brings the average price to just $6 per large, any-topping pizza.

“We worked hard in 2013 to boost awareness of our fresh ingredients and our “Favoritas del Patrón” line of specialty pizzas,” said Andrew Gamm, brand director for Pizza Patrón. “This ‘3 for $18’ deal makes exploring our ‘Favoritas’ or any other combinations of toppings a risk-free option, and lots of fun for customers old and new.  We hope that once people experience the value of our fresh dough and fresh ingredients pizzas, they will become loyal fans and frequent customers of the brand.”

During the promotion, for just eighteen bucks, Pizza Patrón fans will be able to pick any three large pizzas they want, select from more than a dozen topping options, and choose from Pizza Patrón’s classic marinara or creamy Alfredo sauce bases.  The entire line of Pizza Patrón’s “Favoritas del Patrón” specialty pizzas, such as La Patrona and La Hawaiana, are also included in the deal.

Pizza Patrón’s “Any 3 for $18” offer will be available from Jan. 1 to Feb. 28 and no coupon is required.

About Pizza Patrón

Since 1986, Pizza Patrón has been committed to making its promise of “Más Pizza. Menos Dinero.®” a reality for every customer.  From the beginning, the brand has been recognized for its ‘fresh-dough’ pizza, its low prices and its trademark “friendly, bicultural service.”  In 2007, the company drew international media attention with its PIZZA POR PESOS® program when it began accepting Mexican Pesos at all of its restaurants.  In 2012, the company’s PIZZA POR FAVOR™ promotion that gave free pizzas to anyone who ordered in Spanish sparked international news coverage and lively debate throughout the U.S.  Today, Pizza Patrón is the leading Mexican pizza brand in the U.S. and remains dedicated to bringing its unique experience to life with every pizza made, and in every community it serves.

Website – www.pizzapatron.com

Facebook – http://www.facebook.com/pizzapatron

Twitter – http://www.twitter.com/pizzapatron