Sie sind auf Seite 1von 18


hen it comes to tossing dough around, no one does it more often and
better than Pizza Hut. The division of YUM! Brands- operate the world's
#1 pizza chain with more than 13,000 outlets in nearly 100 countries
worldwide. Pizza Hut is an American restaurant chain and international franchise
based in Addison, Texas . Pizza Hut Inc. is the largest pizza restaurant company in
the world in terms of both the number of outlets and the percentage of market
share that it holds. A subsidiary of PepsiCo, Inc., the company oversees more than
12,000 pizza restaurants and delivery outlets in 90 countries worldwide. The chain
serves a variety of pizza styles, including its flagship Pan Pizza, as well as Thin n'
Crispy, Stuffed Crust, Hand Tossed, and Sicilian. Other menu items include pasta,
salads, and sandwiches. Nearly 20% of its restaurants are company-operated; the
remaining units are franchised or licensed.

For the past four decades, Pizza Hut has built a reputation for excellence that has
earned the respect of consumers and industry experts alike. Building a leading pizza
company has required relentless innovation, commitment to quality and dedication
to customer service and value. The qualities of entrepreneurship, growth and
leadership have characterized Pizza Hutt’s business through more than four
decades of success. Through the strength of its heritage, its culture and its people
and franchisees, pizza hut looks forward to more success in the future.


Pizza Hut was founded in 1958 by brothers Dan and Frank Carney in their
hometown of Wichita, Kansas. When a friend suggested opening a pizza parlor--then
a rarity--they agreed that the idea could prove successful, and they borrowed $600
from their mother to start a business with partner John Bender. Renting a small
building at 503 South Bluff in downtown Wichita and purchasing secondhand
equipment to make pizzas, the Carneys and Bender opened the first Pizza Hut
restaurant. A year later, in 1959, Pizza Hut was incorporated in Kansas, and Dick
Hassur opened the first franchise unit in Topeka, Kansas.
In the early 1960s Pizza Hut grew on the strength of aggressive marketing of the
pizza restaurant idea. In 1962, the Carney brothers bought out the interest held by
Bender, and Robert Chisholm joined the company as treasurer. In 1966, when the
number of Pizza Hut franchisee units had grown to 145, a home office was
established to coordinate the businesses from Wichita. Two years later, the first
Pizza Hut franchise was opened in Canada. This was followed by the establishment
of the International Pizza Hut Franchise Holders Association (IPHFHA). It aimed at
acquiring 40 percent of the company's franchise operations, or 120 stores, and
adding them to the six outlets wholly owned by Pizza Hut.

In early 1970 Frank Carney decided that the business strategy was inadequate, and
that a more developed, long-term business plan was necessary. The turning point
occurred when Pizza Hut went public and began growing at an unprecedented pace.

In 1970 Pizza Hut opened units in Munich, Germany, and Sydney, Australia. That
same year, the chain's 500th restaurant opened, in Nashville, Tennessee.

In 1971 Pizza Hut became the world's largest pizza chain, according to sales and
number of restaurants. A year later the chain gained a listing on the New York Stock
Exchange. Pizza Hut also achieved, for the first time, a one million dollar sales week
in the U.S. market.

At the end of 1972 Pizza Hut made its long-anticipated offer of 410,000 shares of
common stock to the public. The company expanded by purchasing three
restaurant divisions: Taco Kid, Next Door, and the Flaming Steer.

In 1973 Pizza Hut expanded further by opening outlets in Japan and Great Britain.
Three years later the chain had more than 100 restaurants outside the United
States and two thousand units in its franchise network.

In 1977 Pizza Hut merged with PepsiCo, becoming a division of the global soft drink
and food conglomerate. Sales that year reached $436 million, and a new $10 million
dollar headquarters office opened in Wichita.

The 1980s brought new competitors to Pizza Hut, all challenging its number one
position in the pizza restaurant trade, then worth $15 billion in sales annually in the
United States alone. Also, to raise its profile, Pizza Hut introduced "Pan Pizza" in
1980 throughout its network.

In 1984 Steven Reinemund was appointed president and chief executive officer of
Pizza Hut. In 1986 Pizza Hut opened its 5,000th franchise unit, in Dallas, Texas, and
began its successful home delivery service. By the 1990s the delivery and carryout
business had grown to account for approximately 25 percent of the company's total

By 1986 there were 100 restaurants in UK and 5000 worldwide.

In 1990 Pizza Hut opened its first restaurant in Moscow. The Moscow location
quickly established itself as Pizza Hut's highest volume unit in the world.
Restaurants just behind in total volume served were found in France, Hong Kong,
Finland, and Britain.

PepsiCo took advantage of global change following the end of the Cold War,
expanding Pizza Hut into new and emerging markets. In 1991 PepsiCo had
restaurant outlets in 80 countries and by 1997, Pizza Hut restaurants had spread to
90 countries.

In 1994 several changes resulted in the company's first decline in operating profits
in 15 years. The pizza market was no longer growing; fast food rivals cut prices; and
investment in new outlets was draining corporate resources. PepsiCo's restaurant
division saw sales in restaurants open at least one year fall six percent in 1994,
contributing to a drop in profits of 21 percent (to $295 million).

Some indicators were promising: market share rose from 25.6 to 27 percent; 1995
sales increased 16 percent to $5.2 billion; and operating income rose to $414
million, up 40 percent from the year before.

In 1996 Pizza Hut planned to introduce a major new product each year and two or
three line extensions. In 1996 Pizza Hut accounted for 17 percent of PepsiCo's total
sales and 13 percent of its operating profit.

In the late 1990s, PepsiCo drew together its restaurant businesses, including Pizza
Hut, Taco Bell, and KFC. In January 1997 the company announced plans to spin off
this restaurant division, creating an independent publicly traded company called
Tricon Global Restaurants, Inc. The formal plan, approved by the PepsiCo board
of directors in August 1997, stipulated that each PepsiCo shareholder would receive
one share of Tricon stock for every ten shares of PepsiCo stock owned. The plan
also required Tricon to pay a one-time distribution of $4.5 billion at the time of the
spinoff. If approved by the Securities and Exchange Commission, the spinoff would
take place on October 6, 1997.

In July 2000, Pizza Hut became the first company in history

to place its logo on the world’s largest proton rocket.

In 2002, Tricon Global became YUM! BRANDS INC.

In 2006, Whitbread sold their shares to the joint venture to

Yum! Brands Inc. Also as a result, Pizza Hut Inc. UK was
100% owned by Yum!
Lastly, up to date in 2008, Pizza hut owners have bought
Godfather’s Pizza with 28 stores in Ireland.

Enrico, who had risen to the position of PepsiCo CEO,

explained the move: "Our goal in taking these steps is to
dramatically sharpen PepsiCo's focus. Our restaurant
business has tremendous financial strength and a very
bright future. However, given the distinctly different dynamics of restaurants and
packaged goods, we believe all our businesses can better flourish with two separate
and distinct managements and corporate structures."

Pizza Hut’s Mission Statement

“To be the first choice among restaurants and delivering brands by developing our
people capability to deliver maniacal service, product quality , 100% customer
satisfaction, innovation and building great look and feel restaurants to provide
attractive returns to our stake holders.”

And also known through the P.E.A.R.L.S concept

 PASSION for excellence in doing everything.

 EXECUTE with positive energy and urgency.

 ACCOUNTABLE for growth in customer satisfaction and profitability.

 RECONGNIZE the achievement of others and have fun doing it.

 LISTEN and importantly, respond to the voice of the customers.


In our visit to Pizza Hut we conducted research on Economical, Social and
Technological Analysis.


If the country’s economy is strong, hence the GDP of the country will be
powerful also, this is a green signal for the business as the per capita income
if the people will be increased and they will spend more money. In our survey
we came to know that most of the people in the beginning of the months
spend more and they visit pizza hut very often. When the inflation rate
increases the cost of raw material also increases and this leads towards high
prices of the products and vice versa.

Pizza hut is multinational. It has basically originated from
America, so the organization is overwhelmed by the western
culture. There are social forms of society which consist of
upper class, middle class and lower class. Every country has
cultural norms, values, beliefs and religious obligations
which can affect the organization.


Now a day’s technology is improving, where as baking and heating ovens will
be of new and efficient technology and will provide efficient service. Due to
new technology there are new ways of marketing like: internet, telemarketing
and the organization can advertise their products with much faster pace.
Computer based customer data is MIS (managing information systems) helps
in collecting customer data, daily transactions, future forecasting and
decision making. New vehicles will make their service more efficient.

In the internal analysis of Pizza Hut we have considered SWOT of the
company. Every organization has its strengths, weakness, opportunities and
threats. So, the SWOT analysis for Pizza Hut is as following:


 Company’s image

 Quality and hygienic products

 Unique pizza with cheese

 Brand acceptance

 Effective distribution network

 Online orders

 Varity of taste available

 Little competitors


 Import duty

 Competitions
 High prices

 Customer’s loyalty towards Pan Pizza

 Only large size available

 Taste of cheese


 Economic component

 Expansion opportunity

 Demands of different tastes

 Awareness increase


 Threat of upcoming competition

 Lowering tariffs on franchising and licensing

 New entrance like Domino’s Pizza in Pakistan’s market can affect their
market shares.

 Other local restaurants can affect their market shares by providing pizzas
with lower prices.

 Social factors can affect their image as a Western organization.

Pizza Hut was among the first multinational brands to enter the food retail
sector in Pakistan. When the first Pizza Hut restaurant opened in Karachi the quick
service industry was at a nascent stage and the pizza category was dominated by a
sole regional player who had a marginal presence. Pizza Hut went on to play a
significant role in pioneering and developing this category in Pakistan.

Worldwide and in Pakistan, Pizza Hut has become synonymous with the ‘best
pizzas under one roof’. This is because at Pizza Hut the belief is that every pizza has
its own magic, thus making it a destination product—which everyone seeks. It is this
belief that has ignited the passion to create, innovate and serve the finest products
the industry has to offer, while setting standards for others to strive to replicate.
Pizza Hut is committed to providing uncompromising product quality, offering
customers the highest value for their money and giving service that is warm,
friendly and personal.
A critical factor in Pizza Hut’s success has been its unique
dining experience. Crew members at Pizza hut strive each day to
provide ‘CUSTOMER MANIA” – the kind of service that ensures that
every visit of the customer is a memorable one.

Pizza Hut’s constant endeavor to provide extra value – whether it

is pizzas which are available to suit every price range, new
promotions or the introduction to innovative product ranges- that puts a ‘YUM’ on
every customer’s face – has allowed it to increase its presence in Pakistan to the
current 38 restaurants across 9 cities.


A business’s strategy is the pattern of decisions and actions that are taken by
the business to achieve its goals. A business has a variety of goals and objectives.
All businesses need to organize their business activities in order to achieve their
business objectives. Running a business involves planning the current as well as the
future activities. Hence, in order to achieve the business objectives, all business
organizations adopt different strategies. Similarly, Pizza Hut has adopted many
strategies which help achieve the targets set by the main office. Changes are the
external as well as internal environment has led Pizza Hut to rethink their past
strategies and has therefore designed new strategies after noticing the changes in
the environment. These environmental changes are seen through the SWOT
analysis. After considering all the factors, Pizza Hut has decided upon the strategies
and their current strategies are divided into five main categories and further have
sub-parts. The strategies are as below:-

Functional Strategies:
These are strategies designed to improve the efficiency of a business’s operations.
They often focus on an area, such as marketing, human resources and etc. All
business organizations adopt strategies at functional level and as the functional
level is achieved, corporate objectives become easy. In order to make the functional
strategy efficient, Pizza Hut has made all the functional departments cooperate with
each other.

Total Quality Management (TQM):

This is the most important factor for a food chain like Pizza Hut. All the employees’
back-of-the-house i.e. the kitchen assistants are trained accordingly. They are given
extra classes in order to meet the quality standards set by Pizza Hut, around the
world. This strategy is important in order to satisfy the customers. This strategy is
strictly implemented in Pizza Hut in order to fulfill the quality standards. Different
quality management staff is also present at Pizza Hut. The shift managers have the
task to observe whether the quality standards are met or not, whereas there is a
total quality standards department at the main office in Karachi. This department
has the task to implement quality standards and know whether they are achieved or
Business Level Strategy:-
Business level strategies are plans made to gain a competitive advantage over its
rivals in a market. Hence, all the businesses need to adopt business level strategies
in order to compete in a competitive environment. If we take a look at the Pakistani
market, there are no large competitors of Pizza Hut, but unlimited small competitors
exist in the market. The threat of competitors is very low as there is no international
food chain offering pizza in Pakistan at present. Therefore, present strategies
adopted by Pizza Hut are keeping in consideration the present competition.
Whereas, in the future this competition will increase and Pizza Hut will have to
change all its business level strategies in order to compete with its rivals. Now as
Domino’s has opened in varies cities of Pakistan, it will result as a threat for Pizza
Hut and hence, their strategies are to be taken into consideration for further

Pricing Strategy:
The level of competition a business faces determines its pricing strategy.
Sometimes a business has the scope to set its price and other times it does not.
When a business has the scope to set its prices this is a number of pricing strategies
or policies it might choose. As there are no such competitors of
Pizza Hut which could compete with the quality of pizza produced
at Pizza Hut, therefore, the pricing strategy adopted by Pizza Hut
is ‘market skimming’. Pizza Hut has adopted this pricing strategy
as they want to hold maximum share of the market by maximum
profit. This is a golden era for Pizza Hut, as there are no
competitors and hence, Pizza hut is free to charge any price they
want. They are charging higher prices due to the uniqueness of
the product. They satisfy the target market as the food quality is
worth the price paid. The pricing strategy is not just to get the worth of quality but
also to gain maximum profits before any competitor enters because then Pizza Hut
will have to change its pricing strategy. Although the prices would be lowered with
the new entrants in the market but not to a greater extent as the quality food
products are not home-produced. They are imported from different countries
keeping in view the best quality.

Market Share:
As there are dozens of Pizza Suppliers globally providing services in different parts
of the world, but Pizza Hut is the one who got the bigger market shares globally.

This is a survey taken by that pizza hut is having 48% of overall
Pizza market in the world. After that Dominos is leading with a percentage of 20%,
while the rest 32% is divided in the remaining pizza provides globally.
Pizza Hut represents a strong brand that has demonstrated economic
stability over time. Pizza Hut is one of the flagships brands of YUM! Restaurant
Int. which also has KFC, Taco Bell, A&W and Long John Silver’s under its umbrella.


Yum! Brands, Inc., based in Louisville, Ky.- it is the world's

largest restaurant company in terms of system restaurants with more than 36,000
restaurants in over 110 countries and territories and more than 1 million associates.
Yum! is ranked #239 on the Fortune 500 List, with revenues in excess of $11 billion
in 2008. Four of our restaurant brands – KFC, Pizza Hut, Taco Bell and Long John
Silver's – are the global leaders of the chicken, pizza, and Mexican-style food and
quick-service seafood categories.

In October 1997, Yum! Brands were spun off from PepsiCo as Tricon Global
Restaurants, Inc. At that moment it established as a singular goal from which they
never wavered: To be the best in the world at building great brands and running
great restaurants. Now At present Yum! Brands is the worldwide leader in Multi-
branding, offering consumers choice, convenience, and value by combining two
brands under one roof. Multi-brand opportunities still exist across America and offer
franchisees a competitive edge as well as many advantages.
The Yum! System includes three operating segments: - U.S., International (Yum!
Restaurants International) and China Division (includes mainland China, Thailand
and KFC Taiwan). Outside the United States in 2008, the Yum! System opened more
than four new restaurants each day of the year, making us the largest retail
developer in the world.

Franchise History

When did the first Pizza Hut open? 1957

When did Pizza Hut start Franchising? 1959

Year U.S.A. Canada International Corporate

2003 4725 N/A 2562 2544

2002 5901 N/A 3571 2493

2001 5974 N/A 3509 2508

2000 6126 N/A 3489 2469

1999 4277 N/A N/A 2790

How Much Does a Pizza Hut Franchise Cost?

If you have a budget of between $1.3 million to $3 million and a net worth of
$1 million with $360,000 in liquid assets, you can be in business within a year, but
there are other requirements as well. You must commit to building at least 3
restaurants over 3 years. Pizza Hut is part of an organization that offers tremendous
franchise support including advertising, business coaching, training, development,
and cooperative sourcing. Performance Improvement Programs and support are
also offered to each new franchisee along with 12-16 weeks of required training.

What We Like
Yum! Brands offer the power of multi-branding that includes two National Media
Budgets, two Category Leading Brands, and two menus. This can broaden customer
appeal, which has the potential to increase the average check size. Field offices are
located throughout the U.S. to support franchise and company restaurant


• Ranking - Ranked No. 1 in its category in 2008.

• Multi-Branding - Yum! Brand is the worldwide leader in Multi-branding.


• Operations - Can take up to 46 weeks to open the first store, but it's
probably worth the wait.


Each brand has Franchise Business Coaches and/or Franchise Business Leaders to
provide business insight and instruction. Your coach/leader will keep you abreast of
important business initiatives, organize key regional training activity, and be your
primary point of contact.
Yum! Enlists each new franchisee in 12-16 weeks of training. A fee may be charged
for the training activity, and franchisees are responsible to staff their restaurants
and train the restaurant crew.
Yum! University
Yum! University is the management and development arm
of Yum! Brands, Inc. Yum! University’s global curriculum
covers wide-ranging subjects like:

• HR College
• Leading Change
• Coaching Leaders
• Ops College
• Multi-brand Operations
• Development College
• Finance College

Advertising & Marketing

Yum! is committed to making our big brands even bigger. A&W® All-American
Food, KFC®, Long John Silver’s®, Pizza Hut® and Taco Bell® all have annual
promotional calendars featuring a variety of special offers. These promotions are
designed to excite customers and increase that store’s traffic.

Many markets have local advertising cooperatives to coordinate local marketing

activity. Franchisees are encouraged, but not required, to participate in system

Local Store Marketing initiatives help you build customer loyalty with marketing
programs. Franchisees are encouraged to use marketing resources made available
to them.
For a fee, Yum! Brands offer a Development Service Program (YDS) for franchisees
that is intended to facilitate the design, approval and construction of restaurant

Services Provided:

• Site selection
• Contract negotiations
• Corporate approval
• Feasibility
• Design
• Permitting

Why Pizza Hut?

Yum! Brands is the worldwide leader in Multi-branding, offering consumers more
choice, convenience and value at one restaurant location by combining two of our
great brands under one roof.
Multi-branding is changing the landscape of the quick-service food industry in the
United States. Yum! Brands have more than 3,400 company and franchise-owned
multi-brand restaurants worldwide.

Building Diverse Partnerships through Franchising

As Yum! grows the world over, so do the ranks of our franchise business partners,
who reflect the diversity of the markets we serve. Our brands are committed to
ensuring our franchisees represent our diverse customers and we recruit minorities
and women to our winning franchise teams.

In fact, many of our minority and women franchisees are some of the country's
most successful entrepreneurs and are essential to our business growth, building
thriving neighborhoods and providing economic opportunities for our customers.
Often ranked as leading businesses and employers in numerous industry
publications, our franchisees have used their leadership to strengthen our system
and enhance our brand loyalty.

While Yum! Franchising is a fantastic opportunity for many; it may not be for
everyone. Have a look at the following criteria to see if Yum! is right for you:

Do you have capital to grow?

• Personal Net Worth of $1m

• Liquidity of $360m

• Endorsed financial plan for future development

Do you have a passion for operations?
• Quick-service restaurants are a “hands-on” business

• We need operators that are customer focused and pay attention to details

• Foodservice experience is important. If you don't have it, you will need to hire an
experienced leader

Are you committed to building people capability?

• A commitment to management and team training

• An infrastructure that supports multiple restaurant ownership


Ray Kroc, a milkshake mixer salesman, ventured to California in 1954 to visit
McDonald's hamburger stand, where he heard they were running eight mixers at
once. Kroc became business partner with brothers Dick and Mac McDonald and
opened the first McDonald's in Des Plaines, Illinois in 1955. McDonald's and the
Golden Arches have since become an internationally-recognized symbol of quick-
service hamburgers, fries, chicken, breakfast items, salads and milkshakes. . In 1965
McDonald's went public and today is the leading global foodservice retailer with more than 30,000
restaurants, located in more than 100 countries.

Franchising History

When did the first McDonald's open? 1955

When did McDonald's start Franchising? 1955

Year U.S.A. Canada International Corporate

2005 11632 903 9878 8096

2004 11629 860 9694 8038

2003 11533 843 9740 8065

2002 11276 832 9850 8262

2001 11051 812 9455 6918

Start-Up Cost & Franchise Fee

It takes a lot of potatoes to make these fries so come prepared. You will need a
minimum of $300,000 in non-borrowed, personal resources to be considered for a
franchise. Most Owner/Operators enter the System by purchasing an existing
restaurant directly from McDonald’s or from a McDonald's Owner/Operator. A small
number of new operators choose to purchase a new facility, but that requires an
initial down payment of 40% as opposed to 25% for an existing restaurant.
Intensive training addresses all aspects of operating a McDonald's restaurant. While
McDonald’s does not offer financing, McDonald’s Owner/Operators have access to
the company’s established lender relationships with some of the lowest lending
rates in the industry.

Total Investment: $950,200-$1,800,000

Initial Franchise Fee: $45,000
Royalty Fee: 12.5%+
Advertising Fee: N/A
Term of Agreement: 20 years
Renewal Fee: $45K


• Special Incentive Programs -Minority Fran Participant

• Recession Proof Market - McDonald's serves more than 27 million individuals daily
according to 2007 statistics.
• World Class Training - McDonald's is recognized as a premier franchising company around
the world. Training is required prior to becoming an owner/operator.


• Cost - McDonald's does not provide financing or assistance other than the special incentives
for minorities.
• No Absenteeism - McDonald's franchises are open only to individuals who are involved with
the day-to-day operations of the restaurants-no absenteeism allowed.

In 1954, James McLamore and David Edgerton opened their first BURGER
KING restaurant. By 1977, Burger King had opened 2,000 restaurants on three
continents. Today the Burger King system operates more than 11,300 restaurants in
50 states and 69 countries. Approximately 90 percent of Burger King Restaurants
are owned and operated by independent franchisees. Burger King has more than
11,000 restaurants globally in more than 60 countries. This impressive growth relies
on the success of their franchisees and that is why Burger King’s market plan
focuses on “restaurant-level economics.”
Franchise History
When did the first Burger King open? 1954
When did Burger King start Franchising? 1961

Year U.S.A. Canada International Corporate

2004 7050 228 3185 1182

2003 7252 233 3090 1150

2002 7552 244 2629 1038

2001 7756 214 2409 993

2000 7826 208 2495 867

Start-Up Cost & Franchise Fee

Franchise Fees is a flat $50,000 and the total investment could be as low as
$300,000 making Burger King a much more affordable option than most in its class.
Burger King’s franchisee training is geared to provide you with the skills to help
build a successful business in this extremely competitive marketplace. Burger King
offers over 70 days of initial training that covers a broad range of technical and
managerial skills. Courses can be added later for you and your team to increase
experience, business, and operations knowledge. General business knowledge and
past food service experience is required.

Total Investment: $294,000-$2,800,000

Initial Franchise Fee: $50,000
Royalty Fee: 4.5%
Advertising Fee:
Term of Agreement: 20 years
Renewal Fee: $50K


• Franchise Fees - Lower than normal franchise fees. Burger King earns 4.5
percent royalties on sales as opposed to the more traditional 6%.

• Affordable - This is the least expensive of the super chains and although it
can still run into the high 6-figures, friendly Burger King makes you at least
feel like you can afford it.

• Special Incentive Programs - Minority Fran Participant and unsurpassed

on-going support.


• None - We couldn't find much wrong with this one. Although Burger King is
not consumer's first fast-food choice, excellent market research and hand-
holding by the company insures profitable sites before start-up.
Today, in the Franchise 5oo Rank, Pizza hut falls #7 in the list whereas, in
2008 it was #4. In the list of Fastest-Growing Franchises it is listed #65 as of
2009 and in 2008 it was #23. And in the America’s Top Global Franchises it is
ranked #7 in the year 2009 and in the past year it was at #9.

Pizza Hut has built a strong reputation of its brand through giving quality products
and has earned respect from its customers. Its innovation and quality has elevated
them to higher standards during the past few years. But still the company is
planning to encapsulate more market shares. In addition, Pizza Hut has diverse
targets set for them and they have adopted different strategies to successfully
achieve those targets set which will help them rank #1 in all categories in the near