How we’ll compete with the big guys: Little Caesars
Little Caesars might not have the footprint that its key competitors in Australia boast, but according to its director Ernest Koury, it has a value proposition like no other.
Ernest Koury knows the Little Caesars business model like the back of his hand, and it’s little wonder. Back in the 70s, his father operated an outlet in Michigan before taking the concept to the western United States. The family’s involvement in the pizza chain only strengthened over time. Koury and his brother followed in their father’s footsteps, owning and operating all of the Little Caesars stores in west Texas and southern New Mexico before selling their stake in 2009.
An abandoned attempt by his father to bring the concept to Australia in the late 80s didn’t deter Koury from having a go himself, and the wheels were put in motion in 2010.
“I called Little Caesars and said ‘How ‘bout now? How about Australia now?’ It took us a couple of years to get through all of the logistics … but we opened store one in October 2014 (in Sydney’s Casula), and we then spent about a year and a half just going through the supply chain – it’s not easy recreating a brand that’s established half way across the globe,” Koury, now director of Little Caesars Australia, told Hospitality.
Today there are four stores, with Parramatta launching in September last year, Miranda in late December, and Leichhardt in late January.
Koury plans to open five Little Caesars throughout 2017, and beyond that the hope is to launch eight to 12 new stores each year.
The centrepiece of the Little Caesars menu is pizza: thin crust, traditional round and Detroit-style deep dish. In the States, customers love the brand’s Hot-n-Ready concept, where a selection of pizzas and sides are “ready to go the second you walk into the door.” Koury hopes Hot-n-Ready is what will set Little Caesar’s apart from the brand’s better established competitors here in Australia.
“There’s no question that we compete with Domino’s and Pizza Hut. The same way that we compete with them in the US. But what makes us very different to them is our Hot-n-Ready offering,” he said. “What differentiates us from traditional pizza is that we are truly in the QSR space. Pizza has traditionally not [operated] there because there’s usually a seven to 20 minute – of if you’re getting delivery a 30 to 40 minute – proposition. We compete more with McDonald's and Hungry Jacks.”
When the brand first launched in Australia, delivery wasn’t part of the offering – just like it isn’t in the US – however Koury quickly realised that this needed to be reassessed. Australians’ love for customisation and gourmet ingredients meant the menu had to be tweaked too.
“In the US, the majority of consumers are solely focused on Hot-n-Ready. That’s where it took off. So in Australia, one of the big differences is that Hot-n-Ready is just not as well known,” he said.
“More and more consumers are loving the Hot-n-Ready offering; we’re selling more and more each month. But one of the biggest differences is the amount of specialty pizzas we sell. It’s much greater here. We knew that was going to happen. It just takes time for people to become aware of your products and services.”
Koury isn’t intimidated by the competitive nature of Australia’s pizza market. He’s adamant that no other business can offer the consumer the same level of value that Little Caesars can.
“A lot of people think I’m absolutely crazy selling a $5 pizza in Australia, where sometimes an avocado can cost you $5. But we believe in our brand and we believe in what makes us successful.
“In Australia, very few businesses try to provide value. A lot of them just say ‘well, this is what we’ve got to charge.’ I don’t accept that. It’s part of my mindset to provide value for our consumers, and I hope that our consumers appreciate that. Our pizzas are at least 19 percent bigger than our competitors’, which is like an extra 1.5 slices, and I’m still charging $5.
“We do it because we want our customers to love us. We want them to love us because we are fighting for them every day, to provide them with the best value, day in, day out.”