Mom-and-Pop Pizzerias Are In Knead of Some Dough!

Competition from above and below is challenging New York City’s small pizza shops

Like hands on a clock, Rocco Coluccio’s silver ladle traced a quick, careful spiral of tomato sauce onto a fresh circle of hand-tossed dough. It was like watching a maestro play a scale, albeit in the fluorescent-lit, linoleum-tiled halls of a Brooklyn pizzeria.

It was a typical 14-hour workday for Coluccio at Johnny’s Pizza in Sunset Park, where he has worked for nearly 40 years. As he popped pie after mozzarella-sprinkled pie into a gas-heated oven, Coluccio’s 26-year-old son Joseph dropped pie after pepperoni-spotted pie into red-and-white boxes before handing them over the counter or through the window overlooking 5th Avenue to customer after customer, many of whom are Sunset Parkers who have been eating at Johnny’s their entire lives.

“Everything stays the same; the tomatoes, the flour. The only thing that changes is the people’s ages.”

Rocco Coluccio

Chef, co-manager, Johnny's Pizza

“Everything stays the same,” said Coluccio, who has worked there since 1976, when he was a 16-year-old immigrant fresh from Calabria, an orange-growing region on the toe of Italy. “The tomatoes, the flour; the only thing that changes is the people’s ages.”

But year after year, business as usual at Johnny’s has become more difficult. Competition with chain stores, $1 slice shops, and high-end pizza boutiques—along with a restaurant industry that has become increasingly dependent on costly social media advertising and online delivery apps like Seamless—has tested old-fashioned mom-and-pop pizzerias across the city.

“If you don’t evolve, you fall behind,” said John Miniaci, 44, whose father John started Johnny’s Pizza in 1968. John Jr. and Coluccio have run the business since John Sr. grew ill in 1991. But it wasn’t until recently that things really began to change fast.

“Before Papa John’s, you’d pick up the phone or walk in the store to place an order. The computer opened up a new kind of business.”

John Miniaci

Chef, owner, Johnny's Pizza

“In July 2007, a gentleman walked in and said he was opening up a Papa John’s next door,” said Miniaci, whose own father was dying of heart disease at the time. “I said good luck, sarcastically, and ever since then the neighborhood rallied behind us.”

That year, more than 2,200 neighbors, customers and fellow pizzeria owners signed a petition against the Papa John’s, but the chain store came anyway. Johnny’s had to adapt. “Before Papa John’s, you’d pick up the phone or walk in the store to place an order,” said Miniaci. “The computer opened up a new type of business.”

Online ordering was just the start. With the first smart phones in 2007 came apps like Seamless and Grubhub (the two companies merged into Grubhub Seamless in 2013, though the second name appears to be more popular), where customers can search a map of nearby restaurants, pick one out and place an order for delivery or takeout—all online in just a few clicks. Restaurant owners not only had to master these apps but also learn how to advertise themselves on social media networks like Facebook and Twitter. These new developments in technology left the old-school pizzerias a little flat-footed.

“These are businesses where success relies on doing something very traditional,” said Ian Manheimer, an online product developer who interviewed more than a hundred mom-and-pop pizzeria owners for The New York Pizza Project, a coffee table book that documents those restaurants through photos and quotes. “It’s slow to respond to changing times,” he said, “and the byproduct of that is an increasingly stressful business environment for these folks.”

Manheimer explained that many small pizzerias simply don’t have the funding for the huge marketing campaigns that chains like Pizza Hut and Papa John’s use to promote products like hot dog-stuffed crusts or dessert pizza. “Their marketing prowess has created a culture around food where quality is diminished and food gimmicks become the marketable attributes,” he said.

The effect of such marketing is being felt across the country. According to PMQ Pizza Magazine’s annual state-of-the-industry report, sales for independent pizza operators (with fewer than 10 stores) dropped 5.01 percent in 2015. Meanwhile, sales for chain operators (10 or more stores) increased 3.38 percent. The year 2015 also saw a 7.33 percent increase in chain stores, while 1.85 percent of independent stores were shuttered.

“The independents are lagging behind the chains when it comes to online ordering,” wrote PMQ Editor-in-Chief Rick Hynum in an email. “And it’s really hurting them, especially with younger customers.”

The lack of online ordering from mom-and-pop pizza shops could be because most online ordering apps come at a steep cost. Whenever a customer orders from a restaurant using Seamless, Seamless gets 10 to 15 percent of the restaurant’s revenue, no matter what size the order is. The higher the rate the restaurant owner pays Seamless, the higher up on the search results their restaurant will appear. And Seamless isn’t the only show in town for online ordering.

“Seamless, Grubhub, Foodler, BeyondMenu, Push for Pizza, Delivery.com,” Miniaci rattled off a few of the ordering apps Johnny’s Pizza uses. “I pay $750 to $ 820 a month on all those online services. They take a cut, but it works because in today’s society kids have the smart phone or that tablet and they want it simple.”

Online ordering apps have become so big that one app specifically designed for small pizzeria owners has emerged.

“We’re solely focused on helping the local pizzeria,” said Kenny Herman, executive vice president of strategy and business development at the New York City-based MyPizza. Unlike many other online ordering providers, which charges a rate per order, MyPizza charges small pizzeria owners a flat fee, usually around $1.95 per order. Herman explained that MyPizza also helps restaurants manage their digital presence by making their websites more mobile-friendly.* “Local businesses, especially restaurants, aren’t tech savvy,” said Herman. “They don’t have the time or resources, they don’t have the expertise. They know they need to be online, they just don’t know where to start. That’s why we’re here.”

Miniaci, from Johnny’s Pizza, is a big fan of MyPizza, which started in 2011 and now takes orders from over 6,000 pizzerias across the country.

“MyPizza is absolutely helpful,” he said, “If independent pizzerias don’t join it they’re making a mistake.” The company sent Miniaci a picture of a decoration in MyPizza’s lobby; a mural of Johnny’s Pizza next to Papa John’s, but only the mom-and-pop pizzeria was in color while the chain store remained in black-and-white. “I was overwhelmed with flattery,” said Miniaci. “It makes me want to come to work and do more.”

 

MyPizza is absolutely helpful. If independent pizzerias don’t join it they’re making a mistake.

John Miniaci

Chef, owner, Johnny's Pizza

Online ordering app MyPizza favors independent pizzerias over chains, as evident in their lobby art.

MyPizza serves to help mom-and-pop pizzerias overcome the obstacles of online ordering and marketing. But Jared Lander, a tour guide at New York City’s Scott’s Pizza Tours, said that that’s not the smaller outfits’ biggest problem at the moment.

“They are being squeezed from above and below” said Lander, who also teaches statistics at Columbia University. “There has been a resurgence in higher-end places like Keste, Motorino and Riabalta, and a proliferation of dollar-size joints with inferior but cheap products. Traditional places can’t compete with either yet still have escalating rents.”

Lander’s fellow tour guide, Scott Wiener, the founder of Scott’s Pizza Tours, agreed.

“After the 2008 financial crisis, we saw the market splitting towards the upscale, wood-fired places and the one-dollar slice shops,” said Wiener. “One slice for one dollar or a pie for $14. I think it definitely plays into that conversation about the widening gap between rich and poor.”

Wiener said that over the past five years he has seen more upscale boutiques and one-dollar pizza joints open up than middle-of-the-road, $2.70-slice shops like Johnny’s Pizza. Exact numbers, however, are hard to come by. The New York City Department of Health releases its restaurant inspection results to the public on NYC OpenData, and while those results can be filtered for pizzerias, that number would exclude the Italian restaurants which also serve pizza. Differentiating between dollar-slice joints, $2.50-slice shops, and upscale boutiques would be even more difficult, but Wiener estimates that each borough has about 450 pizzerias total from year-to-year.

But still, how do the changes in pizza prices effect how the pizza tastes?

Cheating on ingredients is like cheating on your wife or your girlfriend. The customers will leave you!

Rocco Coluccio

Chef, Johnny's Pizza

Wiener explained that most people don’t notice the difference between pizza at a $2.70 slice shop and a one-dollar slice like at 99 Cents Fresh Pizza because “most people just see pizza as a snack, they just want something that’s cheesy and warm. I think that’s killing the good slice places, but it’s the world we live in.”

Manheimer, of the New York Pizza Project, described the taste difference in detail. “New York Pizza is big,” he said. “The crust has a crunch but is chewy like a bagel. The sauce has a tiny bit of sweetness. The cheese is generous if they’re using a good quality cheese called Grande. And the hands that make it know how to make dough; they let it ferment so it causes less indigestion.”

Coluccio, the life-time pizza chef and co-owner of Johnny’s Pizza, put it even more, well, plainly. “Cheating on ingredients is like cheating on your wife or your girlfriend,” he said. “The customers will leave you!”

When asked about the increased competition from all the other pizza shops out there, Coluccio was defiant. “It’s more of a challenge,” said the maestro, in between pies, as his son kept taking orders and handing warm, pungent pizza boxes to the steady stream of neighborhood customers. “You keep fighting, you never give up!”

 

*Correction, 3/15/16: This article originally contained a quote which said that MyPizza helps manage pizzerias’ social media platforms. That quote has been replaced with a more accurate paraphrase.

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