Professional Documents
Culture Documents
Pizza Hut International Business
Pizza Hut International Business
Pizza Hut International Business
CONTENTS
PAGES
Company Background
1.1
Introduction
1.2
Company Profile
Country Competitiveness
2.1 Firm Structure, Strategy and Rivalry
2.2 Demand Condition
2.3 Factor Condition
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56
8
89
9
1.0
Conclusion
5.1 Strengths
5.2 Weaknesses
5.3 Opportunity
5.4 Threat
Bibliography
Company Background
1.1 Introduction
1
Pizza Restaurant was opened by two brothers Dan and Frank Carney in 1958 in Wichita,
Kansas. Dan and Carney borrowed 600 Dollar from their mother to open Pizza Hut
Restaurant. After borrowing 600 Dollar from their mother, they purchased second-hand
equipment and rented small building in their home town.
In 1959, the 3rd Pizza Hut restaurant was set up as a Franchise which they open in
Topeka, Kansas. Their vision is to develop Franchise System which became a worldwide
successful marketing model. Pizza Hut was first mover towards international market and
set up first Pizza Hut outlets in Canada in 1968. Almost ten years later, Pizza Hut serving
one million customers in a week in their 310 locations. In 1970, Pizza Hut was put on the
New York Stock Exchange under ticker symbol PIZ. International Pizza Hut restaurant
became 100 in number while the total number of Pizza Hut reached 2000 in 1976.
In 1986, Pizza Hut introduced delivery service, something no other restaurant was doing.
Pizza Hut opened its 5000 unit in Dallas, Texas. Pizza Hut celebrated its 30th anniversary
with more than 6000 units in 1988. In 19 th May 1982, Pizza Hut began its operations in
Malaysia with the opening of its first outlet. In 1996, Pizza Hut sales in the United States
were over $5 million. However, Pizza Huts market share has slowly matured because of
intense competition from their rivals which is Dominos, Little Caesars and Papa John's.
In the past, Pizza Hut has always had the first mover advantage. Their marketing strategy
in the past has always been to be first mover. One of their main strategies, which they still
follow today, is the diversification of the products they offer. Pizza Hut is always adding
something new to their menu, trying to reach new markets.Nowadays, Pizza Hut is the
largest pizza restaurant company in the world specializing in American style pizza. As of
2012, more than 6,000 Pizza Hut restaurants in the United States, and more than 30,000
store locations which is 30,190 restaurants in 94 countries and territories around the
world. Employing more than 300,000 people and YUM! is the parents of company of
Pizza Hut. Nowadays they serve different style of pizza along with side dishes including
mushrooms soup, pasta, chicken wings, breadsticks and garlic bread.
1967 1999
1999 present
2
PRODUCTS:
FOODS AND
BEVERAGES
CEO:
DAVID C.
NOVAK
PROFIT:
$4.5 BILLION
(2012)
HEADQUARTERS:
ADDISON, TEXAS,
USA
SLOGAN:
EAT, LAUGH
AND SHARE
MISSION
FOUNDED:
WICHITA,
KANSAS, USA,
1958
COMPANY
NAME:
PIZZA HUT
TYPE OF
BUSINESS:
WHOLLY
OWNED
SUBSIDIARY
FOUNDER:
DAN AND
FRANK
CARNEY
: P.E.A.R.L.S
PASSION for excellence in doing everything
EXECUTE with positive energy and need
ACCOUNTABLE for growth in customer satisfaction
RECOGNIZE the achievement of others and have fun doing it
there are crew members for his assistance. They assist the customers to their seats
based on the number of people. They will also provide the customer menu and explain
about the new items in menu. Once pizza has been order, the pizza is bought in pan and
then served to the customer. If the customers want to take away, the pizzas will be in
special package. For home delivery orders, Pizza Hut tries to deliver order within 30-45
minutes of order being placed. Through there are certain terms and condition like orders
are delivered to places which fall within a particular distance from the outlets. As
Dominos, when they receive order for take away or through telephone for home delivery
it follow a delivery schedule to meet its 30 minutes delivery criteria. For its delivery
promise to work, Dominos follow an 11 minute schedule, one minute for taking down the
order, one minute for Pizza making, six minute oven time and three minutes for packing,
sealing and exit. But, those who eat at the outlet itself are also served in the cardboard
box as for take away or home delivery instead of plates.
2.2 Demand Conditions
Customer Focus
In Pizza Hut, they listen and respond to the voice of customer. In order to satisfy
customers, Pizza Hut provides the best pizzas under one roof. This is because at Pizza
Hut they belief is that every pizza has its own magic, thus making it a destination product
that everybody looking for. Pizza Hut has been a menu that has constantly evolved and
expanded to cater to the changing needs and specific preferences of customer in different
parts of the world.
customer as their produced pizzas that fulfilled Malaysian customer taste. One of it when
Pizza Hut introduced customers of Rendang Pizza and Satay Pizza.
In order to attracted customer to visit Pizza Hut, they focus on affordable pricing. It enjoys
product quality leadership in the market and its pricing is just enough not to be out of
customers reach. Pizza Hut also introduced variety of pizzas menu in order to fulfill the
tasted of customer. Besides that, Pizza Hut not only served their customer for pizza only
but its also served variety of other product for example Salad and Pastas, Soup and
Dessert and Appetizers. Although all the product offering in Pizza Hut are not as fast
moving as its pizza, but they usually complement each other. For instance, when a
customer come to restaurant, its usually starts with some soup and garlic bread and then
moved on to pizzas along with some diet salads. In this way, Pizza Hut caters to different
people with different needs and tastes and preferences. This helps in increasing sales,
profitability, market share and above all.
consumer base ,high purchasing power and less competition .For example in Malaysia
,Pizza Hut open their branches at Mentakab ,Pahang in 1989 .At that time , Mentakab still
be considered as rural area .This is Pizza Hut long-term strategy to outreach those areas
where competition is low .
elements in each pizza are the same. This allows consumers to get the familiar taste they
love, but also allows franchise owners to branch out.
As we know, Malaysia is the country that use Islam as the official religion and Pizza Hut
that operates in Malaysia are strictly not serve non-halal foods and also do not serve
alcoholic drinks. By using this policy, Pizza Hut are able to attract customer to come to
their restaurants mostly Malay. Pizza Hut in Malaysia need to apply Halal certificates
from JAKIM in order to operate their business to all citizens. In terms of menu, Pizza Hut
are try to adapt all the ethnics, custom and traditional foods in order to produce the most
attractive and delicious pizza in Malaysia. For example, Pizza Hut has an experienced in
produce 3D Triple Chicken Sensation Pizza. It consist of the Malay traditional foods, it is
delightful Chicken Loaf, Succulent Chicken Salami and Fluffy Chicken floss. Instead of
trying to produce pizza by following the Malaysia cultures, Pizza Hut also serve variety of
menu, for example pasta , desserts and drinks. In addition, different countries will also
produce different pizza and its only available at that specific countries. For example in
Malaysia have Golden Fortune Cheesy Crown Pizza and Mexican Fiesta Pan Pizza. In
Malaysia Pizza Hut already combine the Pizza Hut's Stuffed Crust Pizza and Signature
pizza, called is as Super Pan Pizza. Pizza Hut in Malaysia also creates the package like
Sensasi Delights, Combo Meals and the latest one is Smart Lunch.
In terms of promotional, there are many types of promotion that Pizza Hut use. For
Malaysia, Pizza Hut more success in attracting people from television commercial. The
commercial that Pizza Hut done, have give a big impact because the study shows that
sitting watching television together with family is one the culture in Malaysia. As we know
the largest competitor of Pizza Hut are Dominos and Dominos promotions are less than
Pizza Hut. Pizza Hut used two languages in their Restaurant services and Commercial in
Malaysia. This because Malay is the official language in Malaysia, meanwhile English
also been used as second language in Malaysia.
Next, the different between Pizza Hut in Malaysia from other countries are delivery
service that Pizza Hut provided. PHD Delivery Sdn Bhd ("PHD) acknowledges and
respects the privacy of individuals. This policy will reduce customer time in ordering the
pizza. This policy also covers all the personal information that PHD hold and sets out the
way in which PHD will use, manage and protect personal information when customer visit
any of Pizza Hut websites or stores. Pizza Hut guarantee 30 minutes or less delivery or
get a pizza on Pizza Hut for free and no delivery charge and all prices are nett.
Meanwhile, Dominos policies are if the delivery late, the customer will receive money off
voucher pizza. In Malaysia have two types of delivery. Firstly, customer can come to the
restaurant make and order and take away. Secondly, customer can order through
telephone or order online and the delivery man will send the pizza straight to the
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customer house within the time required. The official vehicle for the delivery man at Pizza
Hut is the motorcycle.
4.2 India
Pizza Hut in India was opened in 1996; its brought in India its international heritage, its
pizza expertise and world class standards of quality and taste. The pizza is a food foreign
to the Indian palate; this is small feat by looking it as successful brand today.
India is one of the countries in the world that operates only 100 per cent vegetarians
Pizza hut Restaurants. It located I Ahmedabad, Surat and Mumbais Chowpatty, and a
special Jain menu sans root-based ingredient are again a reflection of the adaption to
local preferences. Root-based pizzas do not contain onion and garlic. Instead of garlic
bread, special Jain bread is served. Moreover, dressings on India salad are completely
egg-less. Pizza hut in India created Indian topping and vegetarian pizzas. The most
favorite of flavors in India is Chicken Tikka, Spicy Korma and The Tandoori range. As we
know, in Indians religion they are not allowed to eat meat or beef. But instead of operate
business with fully vegetarian foods; Pizza Hut in India also put some menu for nonvegetarians. The pan pizzas in India start at just Rs 65, which is probably among the
lowest price in the world. The recent Pan 4 All initiatives are also an example of good
value of money. Pizza Hut in India also served side meals such as pasta masti, desserts,
soup and salads and beverages. The difference with Pizza Hut in Malaysia, Pizza hut in
India is allowed to serve alcoholic drinks such as margarita. The special about pizza in
India they serve most tasty pizza it is new Crown Pizza or could be name as The King of
The Pizzas. It contains 12 tastes of juicy vegetarian or chicken kebabs and creamy hot
paper sauce.
Meanwhile the Pizza Hut in India required languages for job application are English and
Kannada. In India, foreigner is everywhere and they believe that in order to make the
communications process run smoothly between workers at Pizza Hut in India, they must
know how to speak in English instead of using their own language.
The advertising or Promotion strategies for Pizza Hut in India are divided in to two-fold.
Firstly, by laying emphasis in India and being International brand with an Indian heart. For
example by creating the pizzas and side dishes by follow the Indian cuisines. Pizza Huts
communication is reflective of family values and family bonding. Secondly, highlighting the
idea that the pizza is a medium that brings people together ensures that this is a brand
that helps to connects with Indian consumer.
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In terms of delivery, Pizza Hut in India still using the same concept of Home country
concepts it is by using Pizza Hut Delivery services (PHD). This service is offers great
quality pizzas, pastas, desserts and beverages delivered to your doorstep. PHD is now
present in over 40 cities in India. Instead of ordering pizza through the phone call,
customer also can order through online. Just click the website, register or log in and
order. It can be done so easily and can reduce time. The benefit of doing this online
ordering is can reduce the mistaken order taken by the staff because customer will
choose the menu by their own. In India, delivery boy basically are using scooter to deliver
the pizza to the customer house, and the policy late received are still remain unchanged
customer will received free pizza when the delivery late about 30 minutes and above.
4.3 China
The first Pizza Hut was opened in 1990 at Beijing, Pizza Hut has been in China more
than 50 city opened 187 Chain store, more than 10000 employees. Among them, the East
China market has 69 stores, located in 15 cities. In late May 2004, China Yum has
announced about the domestic more than 130 Pizza Hut stores management in China
has been fully recovered. In China they called a business management of Pizza Hut,
Tricon Global Restaurants as Yum. Pizza Hut in China region general manager explained
that Pizza Hut later, will not adopt franchise business model, but for the headquarters
management and business expansion China will still refer to the Yum. Some says that
Yum are already ended the contract with the The Jardine group because of they are not
satisfied with the rate of expansion that The Jardine group has done. But based on the
analysis, the management made by The Jardine group about franchise mode cannot
complete the mission yum.
Pizza hut has yet to achieve economies of scale and the franchise's door not closed
permanently, stopping agent, is consideration to depend on Yum strongly and beverage
industry experience, to make the brand do greatly strong.
In terms of Menu of Pizza hut in China, Pizza Hut introduced a series of Chinese food
products. With this, they hope that through the broad and profound Chinese food culture
and pizza are integrated with each other to meet Chinese taste. Pizza Hut and more on
atmosphere, dim light streamed down, reflected in the attached to the walls of the
abstract painting, forming a circle of ambiguous image, giving a hazy warmth, like a
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painting of the evening in a terrible coincidence: only a piece of pizza distance, food and
cultural encounter. They provide three kind of services in China including Full Service
Restaurants (Pizza hut canteens), Home Service Restaurants (Pizza hut delivery), and
Restaurant Based Delivery (Pizza hut express). Pizza Hut was the first restaurant chain
to introduce pizza and Western-style casual dining to China in 1990. Pizza Hut in China
also has made the transition from Western-style casual dining expert", to the introduction
of French treasure progenitors new wine. More than 30 Pizza Hut Happy Restaurant in
China was first introduced the taste of France Bao progenitors new wine. Pizza Hut also
offers three-course gourmet meals at a pretty penny. Customer can find on the menu:
seafood (including: oysters, snails, and shrimp), salads, soups, steaks (beef, lamb and
pork) and all kinds of desserts. The menu in China is quite different from others countries
because they want to adapt the culture from China into the taste of the foods. To get halal
foods in China is not easy because they also served pork and alcoholic drinks in Pizza
Hut restaurants. Pizza Hut now, is the number one casual dining brand in China with
more than 700 restaurants in 120 cities.
China is one of the countries that have technological advances rapidly; in the terms of
promotion China is one of the countries that have a many ways itself in order to promote
the pizza. First by producing a new product, Pizza Hut offer new product for each period,
it always change major dishes in each period of time, and other supporting dishes or
something like that. This promotion strategy can make customers think that Pizza Hut is
in fashion and fresh. Recently, Pizza Hut release a new serious pizza and dishes called
Mythic Harem Its including Harem Sweetie and Magic Apple Tea.
In China Pizza Hut also introduced the thematic series pizza. Such as Universal Fund
Surprising, Trend Exotic Trip and China Featured Although these pizzas have a little
different from each other, for the customer, they are still the new ones. So with this
strategy, Pizza Hut has broadened its market. China belief in their culture, language and
ethnic are very strong, and websites for Pizza Hut in China are fully in their language.
This is one of the ways, how China attracts their customer. Besides that, China also using
a full Chinese language in order to promote their new brand of pizza to the customer in
the television commercials. For example, there are televisions commercial about Chinese
New Year and they want to promote spaghetti so, they use China official language as a
medium to communicate.
Pizza Hut in China also still using the same concept from the Home country for their
customer o make an order for the delivery. Customer can order online or can order
through phone call. Things that make Pizza Hut in China different than others is, Pizza
Hut in China send the delivery by using the electric bicycles for the nearest place and
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using bike for the place that quite far. Pizza Hut in China wants to maintain the concept of
faster delivery of their pizza by Using this bicycles. As we know, the big urban cities in
China are very busy. Thus, with the using of bicycles can accelerate delivery time and
reduce costs. Example of the city that using these bicycles as a transport are Shanghai,
Beijing, Guangzhou, Shenzhen and the whole Zhejiang province.
5.0 Conclusion
Pizza Hut operations are recording very strong sales growth. In Malaysia, K&N
Kenanga Research, an investment analyst company revealed the future plan for Pizza
Hut, The KFC Management had indicated that they would be concentrating on growing
Pizza Hut (The Star, 2000). Pizza Huts sales have been rising rapidly from RM52millions
recorded in 1996 to RM100millions in 1999. SWOT analysis has been performed by Pizza
Hut to achieve the goals there is Strengths, Weaknesses, Opportunities, and Threats.
5.1 Strengths
Pizza Hut is a worlds largest restaurant chain that they dominate their market. They have
over 20,000 franchises around the world and the brand leader in the United Kingdom.
Pizza Hut specialized in pizza and their products have been voted number one in
countless consumer surveys nationwide. They have low competition but Dominos is the
fierce competitor to them. This is because both of them in the same sector and generate
same products in the market. Pizza Hut strength also sound financial situation and
international turnover. Pizza Hut is the famous television advertising and the food attracts
various ranges of people from young to old. They also have a huge segment that
attracting more customers meaning a higher percentage in sales is which may lead to
greater profits. Pizza Hut sits on top of global full-service restaurant tree. They have a full
service restaurant as well as delivery services.
5.2 Weaknesses
However, the weaknesses of Pizza Hut are declining in customer satisfaction of the
pizza that felt by loyal customers. Because of that, may lead to customers switch to main
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competitors such as Dominos Pizza due to low customer satisfaction and a reduction in
customers. The credibility in market also low because of declining in customer
satisfaction. Pizza Hut in New Zealand and Australia face and battle with problem
although Novak said Pizza Hut expansion into China is going exceedingly well.
Therefore, mean they are losing money in places such as New Zealand and Australia that
could be due to their culture and lifestyle. So, Pizza Hut need to introduce more variety
range of products to attract customers based on their cultures and lifestyles. Besides that,
Pizza Huts have a complex computer systems and internal conflicts from franchisees that
leads to the motivation of staff. They also lowering the quality of products, services to
customer and could lead to a lack of new ideas.
5.3 Opportunities
Pizza Hut can attract new customers by introducing new pizzas with different crust
sizes and flavours. The new tastes of pizzas will grab more new customer that may
increase their sales. For example in Malaysia, Pizza with Rendang topping or Satay
topping. In addition, Pizza Hut has expanded into the Indian market menu and looks to
the olds favourite to increase sales in the United States. They also can come up with the
new products considering the Eastern taste of the people and diversification of new
products that can increase their market share. They has targeted upscale products and
downscale consumer base that will attract customers who are willing to buy these pizzas.
5.4 Threats
The most threat for Pizza Hut is the competitors. Dominos Pizza is the strong and
fierce competitor to Pizza Hut because their main competitive advantage over Pizza Hut
is their lower price. McDonald also has tried to introduce a new meal that is a pizza called
McPizza. In order to compete with Dominos Pizza, McDonald or others competitor, Pizza
Hut need to improve or maintain the quality of the pizzas to ensure that Pizza Hut
dominate this market. As consumers go for greater convenience it rising competition
undermines Pizza Hut. The sales will go to smaller companies who are charging less will
lower the amount of sales consumed by Pizza Hut. Cheese is really important and the
main ingredient to make the pizzas. So, rising cheese costs threaten margins that tend to
Pizza Hut eventually buying goods from abroad or buying cheaper products that not
quality.
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6.0 Bibliography
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Pizza
Hut
Malaysia.
(2009).
http://www.pizzahut.com.my/
Retrieved
History of
Pizza
Hut.
(2012).
Retrieved
http://en.wikipedia.org/wiki/History_of_Pizza_Hut
Yum
Brands!
(2012).
Retrieved
http://en.wikipedia.org/wiki/Yum!_Brands
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15,
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Rivera.D (Date of publication). Pizza Hut Franchise History. Retrieved December 15,
2012 http://franchisewisdom.com/pizza-hut-review
Schreiner.B (2012, Oct 9). Pizza Hut, Taco Bell owner Yum's 3Q profit up 23 pct. as
China unit recovers, US demand grows. The Canadian Press, pp. 1-6.
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