Is pizza shop a good small business? (credit card, lease, fees)

[rhbj03]

May not make a killing but should be somewhere safe, no?

Everyone eats pizza.....

[mapleguy]

Are you going to rent the building ?


Have you operated a business before, and if yes, what kind and how long ago ?


How much actual cash do you have to start the business ?


Have you researched the other business operations in your proposed location ? Are they profitable, or are there empty stores on the streets ? What is the average family income in the area ? How many apartment buildings are there ? Apartment dwellers buy more pizza, than home owners do. Young adults buy more pizza than seniors do.




Have you figured out the weekly cost of running the business ? Supplies, utilities, insurance, buy or lease the equipment , and the cost of paying staff. Advertising is a big part of having a successful small business. How much money are you budgeting for advertising every week ?


How close to your location are the BIG chain pizza corporations ? I bet that if you do some looking around, you will find that you are going to be butting heads with Pizza Hut, Dominos, and the rest, unless you are in a town with 5,000 people. Even then, you WILL have competition. Why should a customer buy at your store , compared to Joe's where he has been buying for 5 years ?


Its is not all rainbows and sunshine. You will be working 7 days a week, 12 hours a day, for minimum wages, for years.




xxx.

[JONOV]

It depends on how good your pizza is, and how efficient you are at running the pizza shop, and your environment. A crappy pizza place that sells pies on the cheap til 5 AM can do well near a college.

If you're in a nicer area, you may need to up your game as far as pizzas.

[Mnseca]

Not really safe, no. Restaurants are more likely to go out of business than nearly any other type of small business.

[WannabeCPA]

Originally Posted by Mnseca

Not really safe, no. Restaurants are more likely to go out of business than nearly any other type of small business.

I think that's a myth. From what I've heard restaurants don't have a disproportionately high failure rate compared to other small businesses. Keep in mind a small business can be some guy starting a consulting business from his computer at home. Or selling homemade crafts through the internet, or mowing lawns. What makes restaurants so risky are the large capital expenditures that are required to start a restaurant.

[oregonwoodsmoke]

Pizza is a crowded field. It would be hard to compete with the cheap pizza guys who have their industry all figured out and who have national advertising campaigns.

Home delivery pizza is in demand, but the low price places seem to have that pretty well tied up. A middle of the road place here is charging very close to $30 for a delivery pizza, then your tip for the driver on top of that. I think the customer base for $30 delivery pizza might be rather small.

I know of at least three very high quality, high price pizza places who have been busy and doing well for decades, but I suspect you would have to be able to afford to support your pizza business for maybe a couple of years until word of mouth finally built up your customer base so that the business was self supporting. Incidentally, none of those very top end pizza places does delivery. I suspect that when people intend to pay a large amount for their dinner, they want to go in, sit down, be waited on, and have someone else do the dishes. It's a different crowd from the bring me a cheap dinner because I don't feel like cooking crowd.

[doodlemagic]

I see pizza places investing heavily in mailer advertising which leads me to believe they are hurting for business. Also realize that buying a pizza shop is buying yourself a job.

[City Guy997S]

A good friend owns a pizza shop....mom/pop type place, not a chain.

1. Rent can be crazy high ($3000 a month, 12 tables).
2. Cash is GONE....everyone seems to pay with a debit/credit card. Years ago you could skim a couple hundred at the end of the day. Today you have days you don't do $200 total in cash.
3. Cheap pizza places (Little Caesars/Papa Johns) are killing your margins if you are in a price sensitive area. College kids for example will buy the cardboard pizza for $5 rather than your pie for $10. Even 7/11 sells full pies for $5-6.

I worked for someone 20 years ago that had 30 Domino's stores in a region. Money was crazy, employee theft was insane, corporate rules/franchise fees were robbery! They sold the chain and said they would NEVER do any franchise ever again.

Another interesting business (to me) is the "delivery dudes" concept. You essentially get paid to deliver other restaurant's food and they use all independent contractors (like uber)
Delivery Dudes expands despite growing pains - Sun Sentinel


They get a delivery fee, they buy the food cheaper than you could as a customer so it is a 2 fold profit.

[High Altitude]

Pizza is a good business because they are cheap to make. Once you make your fixed costs for the month it is all gravy.

Which is why there is so much competition.