How Pizza Ranch learned to live with the buffet, then without it

0

Pizza Ranch wasn’t meant to be a buffet, at least not initially. But one franchisee tested the concept of an all-day buffet decades ago. The idea worked. And the chain known for its unique combination of chicken and pizza has grown into a buffet concept, steadily expanding throughout the Upper Midwest. It now has 218 slots.

Buffet, in fact, was all the chain knew. Oh sure, he did takeout and delivery. But that wasn’t his thing. “When you focus on the buffet, delivery and takeout are a sideline,” Adrie Groeneweg, the company’s president and founder, said in an interview. “We did, but that was secondary.”

And so, in March 2020, the buffet chain that wasn’t supposed to be a buffet chain suddenly had to learn to live without a buffet. The pandemic has practically stopped them.

“Buffet and COVID don’t go together,” Groeneweg said. “We lost 80% of our sales.”

But adapt society did. The chain’s system sales in 2021 were up 3.5% from 2019. That might not seem like much, especially compared to some other pizza chains, but consider this: Buffet chains as a sub- sector are down more than 38% from where they were before the pandemic, according to Top 500 data. and HomeTown Buffet, have all disappeared.

Pizza buffet chains haven’t fared much better, with companies like Pizza Inn and Cici’s down at least 22% from pre-pandemic levels.

“We are very happy with where we are,” Groeneweg said. “Sales are back to where they were and even above. We again have a lot of interest from franchisees.

Hull, Iowa

Pizza Ranch specializes in pizza and fried chicken, traditionally served buffet style. Popular Christian music frequently plays overhead and the company’s vision is to “glorify God by positively impacting the world”. The chain’s community halls often attract Republican presidential candidates during the build-up to Iowa caucuses.

The company “lived its Christianity on its sleeve,” says franchisee Brandon Pratt. That’s part of what convinced him to become a full-time Pizza Ranch franchisee 16 years ago.

Groeneweg founded Pizza Ranch when he was 19 years old. He was a full-time welder who worked part-time at a pizza place and couldn’t help but notice how busy it was. He convinced his father to take out a loan to buy a building and pizza equipment.

“We had 17.5% interest rates in 1980,” Groeneweg said. “Without my father, this would never have happened.”

The restaurant opened in 1981 in Hull, Iowa, a town of 2,000 southeast of Sioux Falls, SD, just south of the Iowa-Minnesota border. He used pizza recipes developed in his parents’ kitchen, where Groeneweg lived his first year in business.

Those first days were tough. “The first year I didn’t get paid, but I was living at home so it wasn’t that necessary,” he said. “A lot of new businesses, that’s how it works.”

By the second year, he says, the company’s reputation grew. He ended up getting paid. The company has opened a second site in the nearby town of Orange. “It took off from day one,” Groeneweg said. Then, someone wanted to buy the recipe for his pizzas. Groeneweg instead convinced him to become a franchisee.

Six years later, the chain operates 50 stores. Almost all of them were in towns of 5,000 people or less.

“I don’t care about them. The food is below average. The restaurants are always dirty. I didn’t want to be a buffet house. -Adrie Groeneweg, Founder of Pizza Ranch.

Listening to franchisees

Pizza Ranch was not a buffet concept, not immediately. There was a simple reason. “I was against it,” Groeneweg said. “I’m not a big buffet guy.”

Wait what?

“I don’t care about them. The food is below average. The restaurants are always dirty. I didn’t want to be a buffet house,” he said.

This is a notable admission. But sometimes innovation can spring from such skepticism. Pizza Ranch offered a lunch buffet, but Groeneweg didn’t want that to extend until dinner. A franchisee asked him to carry out the idea all day and tested it himself. Sales immediately increased.

“His sales were up 23%,” Groeneweg said. “You can’t not watch something that boosts sales by 23%.”

The remaining restaurants had the same kind of result. And Pizza Ranch has become a buffet concept. Groeneweg, meanwhile, has changed his mind about the idea, which can do with a 23% increase in sales. “I’m very proud to be a buffet now,” he said. “My attitude has completely changed. I’m a neat freak. Your stores look fresher. This is how we manage them.

But there is another thread here. Pizza Ranch listened to one of its franchisees. This has been common throughout the company’s history.

“The fried chicken comes from a franchise. It’s not from Adrie,” Pratt said. “The Fun Zone did not come from the company. The drive-thru window was from a franchisee. They really understand very well the importance of listening to their operator.

All these innovations have been important for the history of the brand. One year in the late 1980s, a family restaurant in Sioux Falls chose to transform into Pizza Ranch. But he wanted to keep his fried chicken. “I noticed his lunch hours were a lot busier,” Groeneweg said. “I went down and worked with him for a week and realized it was the chicken.”

The company put chicken in more stores, then came up with its own recipe. “It definitely sets us apart,” he said. “We should have called ourselves Chicken Ranch. We put it on employee shirts.

“We have a great relationship with our franchisees,” he added. “I lack a lot of qualities. But one thing I’m good at, I’m a great listener. The franchisees know that. The people who work with us know that.

“We get our best ideas from franchisees. They know how to do things. »

Some of these ideas have carried the company through the pandemic.

Sale of pizza buffet chains since 2019

Source: Technomic Top 500 Restaurant Report

Restaurant chain with drive-thru

It’s hard to say how bad the pandemic has been for the buffet industry. But many, if not most, of the restaurant chains that closed completely were buffet concepts. “It was a time of depression,” Pratt said. “We didn’t know what was going to happen. And in the beginning, there were so many false stories that continued to harm the restaurant industry, especially the buffet industry.

Pizza Ranch has done a lot to adapt to the new reality. She launched a virtual brand, for example. But it also began to focus more intensely on its “out-the-door” business, or takeout and delivery. It has started working with third-party delivery companies, although some operators have their own drivers. The company sold a lot of two-piece dinners and family meals to its customers.

“We all knew that sooner or later COVID would go away,” Pratt said. “We had to stay relevant. It was not a question of profitability. It was about staying in the customer’s face.

Pratt himself came up with an idea, a brunch service in which restaurants opened earlier on Saturdays and Sundays for people who wanted a Sunday brunch.

But another could become a permanent part of the business in the future: drive-thru. The brand tried the windows in four locations. It also has service windows so people can get their orders in advance. “I would struggle to make any Pizza Ranch without it,” Pratt said. It has such windows in six of its locations. “This is another area of ​​our business that is constantly growing.”

Most of its markets get around 10-15% of their sales through windows, with customers buying fried chicken as well as pizza and, typically, the chain’s popular Cactus Bread dessert pizzas.

But the brand also generates sales inside its restaurants.

When Pizza Ranch started, there were rooms with pinball machines and other games. When customers stopped playing them, they were deleted.

More recently, however, a franchisee has added new games with pricing closer to concepts like Chuck E. Cheese and Dave & Buster’s. The result was an instant increase in sales and profits.

Pratt, who owns nine units, added his first in 2018. “He came out wildly successful,” he said. They generate 20% more sales but can add 40% to 50% to a location’s profits. “The day you open, you increase your sales by 20%,” Pratt said. “It is obvious.”

Adding them may require a $500,000 expansion, Pratt noted, but revenue and profits pay off quickly. Pratt himself has Fun Zones in five locations and two more under construction will include the games.

“We’re a new version of entertainment,” Pratt said, referring to the industry that focuses on both food and entertainment.

Not for the faint of heart

There are challenges, of course. “Operating a Pizza Ranch is not for the faint of heart,” Pratt said. “It is a difficult operation. You must have great operators.

“We are a buffet, restaurant, Fun Zone arcade, pickup, delivery and catering service. It’s six different segments under one roof.

It can also be expensive to open a location, around $3 million. Groeneweg, in fact, notes that the company could not open today in the small towns where it has made a name for itself, largely because it would not be able to generate enough sales to pay the price. construction.

Franchisees also need to have more financial support. “We have a different franchisee coming in today than 20 years ago,” Groeneweg said. “If they come today, they really need the money and have the money at their disposal. Twenty years ago, someone with $5,000 in the bank could open it. It wouldn’t work today. I don’t like it, but that’s how it is. »

The focus now is on maintaining the door-to-door sales the chain has gained during the pandemic, without sacrificing that buffet business too much. Both Pratt and Groeneweg said takeout has declined somewhat, but not by much. “Right now we’re at 33% (pickup and delivery) and we’re happy with that,” Groeneweg said.

Still, the brand is growing now that it’s emerged from the pandemic. It just opened a location in Wyoming and is opening one for the first time in Oklahoma. The company is on track to open 10 units this year. But Groeneweg, who is 60, wants to pick up the pace.

“I have three boys coming up the ranks here,” he said. “I told them I wouldn’t retire until we hit 500 stores. We have to move here. »

Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all our content. Register here.

Share.

Comments are closed.