For much of this year, business at Prima Pizza Kitchen, in Somerville, New Jersey (USA), was booming.
On many Fridays, up to 325 pizzas would go out the door, with customers often adding drinks and sides. But in recent weeks, orders have started to change, said owner Jerry Carollo.
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“Before, the customer would order two large pizzas, chicken wings, garlic knots and soda, all the extras offered,” said Carollo. “Now, they’re just ordering pizzas.”
To varying degrees, this sentiment has been echoed across the country, by both large chains and small independent pizzerias.
Pizza, with its melted cheese and sometimes topped with crispy, shiny slices of pepperoni or bright strips of green pepper, has always played an essential role in American homes. It’s a comfort food for hard times, traditionally capable of feeding an entire family for a relatively affordable price.
But now, with the national average price of a large cheese pizza reaching almost $17, according to Slice, an online ordering platform for pizzerias, sales are slowing.
Competition with other restaurants on delivery apps and changes in eating habits are part of the explanation, but it also indicates that some consumers are in financial difficulty.
This summer, 30-year-old Bria Celest was surprised when she and her boyfriend ordered an extra-large pepperoni pizza from Pizza Hut and the bill came to almost $30.
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“I thought, ‘Wow, pizza prices have gone crazy,’” said Celest, a photographer in Los Angeles. “When I was a kid, we ordered from a local pizzeria that delivered two extra-large pizzas, a two-liter soda and a side for $25.99. I would faint if I saw an offer like that today.”
For now, pizza chains — which represent two-thirds of a sector worth almost US$50 billion (R$266 billion) per year — have recorded practically stable sales since 2023, according to Technomic, a research and consultancy company for the food sector.
In October, Papa John’s executives said that in the most recent quarter, customers were reducing orders from large to medium pizzas and adding fewer toppings.
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Pizza Hut — dominant in the 1980s, when it hosted children’s birthday parties and youth baseball team celebrations — had eight consecutive quarters of declining sales compared to existing stores.
Its parent company, Yum! Brands, is evaluating options, including a possible sale of the chain.
Pizza Hut and Papa John’s declined to comment on the information.
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“The pressure on sales, especially among lower-income consumers, is not exclusive to pizzerias,” said Sara Senatore, an analyst at Bank of America.
“We’re hearing this across the fast-food and fast-casual sector: This group has been under pressure for a while. And now it’s starting to hit the middle-income consumer.”
On social media, consumers share tips on how to pay less for pizza. (Download the chain’s app. Join loyalty programs. Look for promotions in the app.)
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But a more cautious consumer isn’t pizzerias’ only battle.
During the Covid-19 pandemic, pizza sales soared because the product was already widely consumed in takeout orders or delivery to families confined at home.
But with the growth of delivery apps, such as Uber Eats and DoorDash, and the entry of other chains and food options on these platforms, pizza is facing stiff competition for consumer dollars, analysts say.
“Pizza is still huge,” said David Portalatin, a consultant at Circana. “But chicken strips and wraps have been growing a lot. That market share needs to come from somewhere.”
Additionally, consumers are increasingly embracing wellness trends, while others are using medications that reduce appetite (GLP-1).
These changes challenge a product often made with white flour dough, processed meats and large amounts of cheese.
“We are toying with the idea of a GLP-1 compatible pizza,” said Casey Terrell, marketing director at Blaze Pizza, a chain of 270 franchised restaurants where customers choose as many toppings as they want for large pizzas, which then go into an 800-degree oven for three minutes. “Something that had a lot of protein, but fewer calories with a cauliflower pasta.”
For now, pizza chains are betting on promotions and combos to try to win back customers.
At the end of August, market leader Domino’s launched a limited-time promotion of US$9.99 (R$53) for any pizza with any topping. The offer was popular, and sales increased 5.2% in the quarter ending September 7.
Executives said they would continue offering the promotion because franchisees said it was working. “This is bringing movement into stores and bringing profitable movement,” Domino’s CEO Russell Weiner said on a conference call with Wall Street analysts in mid-October.
Domino’s did not respond to requests for comment.
For independent pizzerias, the scenario is a little different. Overall, they haven’t faced the same drops in sales as some chains, although their products tend to be more expensive because they don’t buy ingredients in large volumes, said Loren Padelford, chief revenue officer at Slice, which has 15,000 independent pizzerias on the platform.
“The average independent operator is growing,” Padelford said. “Not a knock on Domino’s, but most local pizza places make better pizza.”
He noted, however, that customers are ordering fewer wings and appetizers and increasingly choosing to pick up their pizza at the counter instead of paying delivery fees.
Still, many independent pizzerias say their profits are shrinking because some ingredients have become more expensive and because fees to list the restaurant on platforms like DoorDash, Uber Eats and Slice have risen. Some say they need to offer promotions to compete.
“I’m sharing some specific promotions, a different selection of pizzas, on all of our social networks,” said Carollo, from Prima Pizza Kitchen. “You really need to show up for people.”
Carollo added that some costs have gone up a lot. A 11kg box of the special pepperoni he uses has risen to US$140 (R$742), compared to US$110 (R$584) just two years ago.
His company is also present on all third-party platforms — a necessity, according to him — because they represent up to 30% of his business, even though they charge between 15% and 25% in sales fees.
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