Docherty’s
Delicious
Pizza
Mr. Docherty
Periods 1-8
9/26/11
Executive Summary
Docherty’s Delicious Pizza is a dynamic new player in the pizza industry. As a sole
proprietorship, we will be a delivery and take-out pizza shop located in the highly traveled
Duncan Manor plaza north of Pittsburgh. We will stand out in the pizza industry due to, first
and foremost, our quality. We will also stand out because the other pizza places in our vicinity
are mostly known as sit down restaurants. DDP’s delivery specialty model will fill the need for
convenient home delivery pizza in this area. DDP’s embrace of technology and coupons will
undoubtedly set DDP apart from the out of touch competition. Our innovative marketing
approach to pizza will get the word out about us effectively without sacrificing profit. All of this
leads to our overall mission at DDP’s: to expediently deliver quality pizzas at an affordable price
to those in the McCandless area and therefore establish ourselves as THE pizza delivery joint in
the community. When you’re thinking delivery, you’re thinking Docherty.
With a loan of $97,741.94, DDP’s operations will be secured for 3 months, ensuring
smooth operation in case of any unforeseen circumstance. About a third of the money will go
towards the necessary, high quality capital needed to ensure success from the beginning. The
tools of the trade are nowhere to spare expense, and the high quality products will lead DDP to
a fast start out of the gates. Two thirds will be designated for operating costs, for labor and the
highest quality ingredients.
As soon as this funding is received, we expect to be up and running within a month. Our
simplified model will allow us to open and start turning a profit quickly. Docherty’s Delicious
Pizza is sure to be a stunning success and a sound investment because we’ve done our
research, we see the need for what we offer, and we have the drive, ambition and knowledge
to make it a reality.
Mission and Goals
Our overall mission and goal is to expediently deliver quality pizzas at an affordable price
to those in the McCandless area and therefore establish ourselves as THE pizza delivery
joint in the community. When you’re thinking delivery, you’re thinking Docherty.
Our immediate goal is to become the dominant pizza home delivery establishment in the
five mile radius from our chosen location. This will be done through a grassroots
marketing campaign and word of mouth so that we can have a foothold in the
community.
Once this goal is achieved, our goal is to expand our menu to offer other takeout/delivery
standards, such as sandwiches and wings. This will allow for more profitable items and a
wider customer base with expansion in mind. But without establishing our brand of pizza,
these steps would be for naught.
Our long term goal is to expand. In a thoughtful, deliberate way, we will build our brand,
establish ourselves in McCandless, and slowly branch out to neighboring territories such
as Hampton and Wexford. This will allow us to become the dominant pizza delivery place
in the northern Pittsburgh area.
Industry Understanding
By and large, pizza and Italian-American cuisine has proven to be recession proof compared
to other types of restaurants. It is a staple of American life today across race, ethnicity, gender,
socioeconomic status, and age. After consulting others in the industry, we plan on selling an
average of 75 pizzas a day over a month’
For DDP’s region specifically, there are two competing pizza places: Belisario’s and
Luciano’s. The strength of these establishments is in their dining experience. Both are typically
seen as a sit down, dine-in affair. Take out is also an option, specifically at Luciano’s. Few view
these establishments as a quick and easy pizza to be delivered to their home. They are fine dining.
Both Belisario’s and Luciano’s reflect this in their prices and deals.. The cheapest large one
topping pizza is over $13, with some gourmet pies being over $16. They do not have prominent
deals or coupons. This is fine for a sit down restaurant, but delivery consumers are looking for
deals to feed families cheaply and quickly and to offset delivery costs. A perusal of Luciano’s
website offers no coupons and a vague “Daily Specials” section, with a pasta special on Tuesday
being the only entry. Belisario’s doesn’t even have a website.
Industry Understanding
Overall, pizzas have high profit margins across the industry. Employees require little
training or specialized skill sets.
Products and Services
Delicious Docherty’s Pizza will offer a service the area is in great need of; fast, cheap,
quality pizza delivery with multiple lines of accessibility for a modernizing society.
Docherty’s Delicious Pizza will offer pizza delivery to a large suburban area. DDP brings
several benefits to consumers that current competitors do not offer.
Docherty’s Delicious Pizza offers fast delivery.
o DDP will have more delivery drivers working at a time than the typical pizza place.
DDP will employ an innovative “refer a friend” promotion
o For every friend you refer to DDP, you will receive a free pizza. If we receive an
order from a new phone number to a new address and they mention your name
while ordering, we will credit a free pizza to your account. This gives consumers the
incentive to do our marketing for us and allows us to reach invaluable new
customers at no cost.
DDP offers competitive pricing and coupons.
o DDP will offer large pizzas for $11.50 as a standard price and will offer various
coupons often for different deals. Current competitors are priced higher and rarely
offer coupons.
DDP will utilize social media and technology to increase contact with consumers
o DDP will post coupons to twitter and facebook. DDP will have a website that is
mobile phone compatible, with scannable coupons. DDP will allow orders to be
placed online. Nearest competitors are absent in social media, underutilize the
web, and in one case do not utilize it at all.
All of these features will set DDP apart. Consumers will come to DDP for its speed, convenience,
pricing, and technological presence.
Management
As an entrepreneur and sole proprietor with much invested in the success of the business,
the owner will be managing the company. The owner’s experience in the food and restaurant
business is expansive. The owner has had firsthand experience with the inner workings of a pizza
business through employment at a Rotelli Italian food franchise. The owner knows how to make
pizza, deliver pizza, and interact with customers, building relationships for repeat and loyal
customers. The owner has trained others to do the same in the past and will do so in this venture
as well. The owner will not have to share the profits with anyone and can do with them what is
necessary. Management will be made easier and streamlined. Profits will only be taxed once,
leaving more money for the sole proprietor.
Two positions will be required: pizza cook and delivery driver. Both must be at least 16
years old and eligible to work in the United States. The pizza cooks will need minimal training and
minimal prior experience. The drivers will need a valid license, a vehicle, and a familiarity with the
area. The cooks will be responsible for cleaning facilities and tools, and also working the register.
The drivers will be responsible for assisting in washing dishes at the end of the night.
Operations Plan
Continuing costs per month:
Cost
Land $10,191.25
Labor $11,182.00
Total $21,373.25
One time Startup Costs:
Cost
Capital $33,622.19
Amount of loan needed for first 3 months operation: $97,741.94
Total Cost per pizza minus startup costs: $9.50
Price per pizza to maintain 20% profit: $11.50
Estimated revenue per month with 2250 pizzas sold per month $25,875.00
Minus estimated Monthly costs $21,373.25
Estimated Monthly Profit $4,501.75
Operations Plan
LAND
LOCATION:
1701 Duncan Avenue, Allison Park, PA 15101
Rate: $19/square foot/year
Size: 1,875 square feet
Cost per month: $2,968.75
This is a good location for a pizza shop. There are 95,747 adults in a 5 mile radius from the location. Duncan
Manor is a shopping plaza near Duncan Avenue, a heavily traveled road near Ross Park Mall. The size is
appropriate. According to several pizza franchising websites, they site between 1,000 and 3,000 minimum
square feet for a site that offers dine in, take out, and delivery. There were no business of comparable size
and price in that area for sale, so leasing was the only option.
(See Appendix A)
Ingredients:
ITEM PRICE PER PIZZA CITATION
Pizza Sauce $0.48 Appendix A
Yeast $0.14 Appendix A
Flour $0.48 Appendix A
Olive Oil $0.25 Appendix A
Salt $0.03 Appendix A
Sugar $0.03 Appendix A
Cheese $1.32 Appendix A
Pizza boxes $0.48 Appendix A
Total cost per Pizza: $3.21
Average expected sales per day: 75 pizzas
Total cost per month: $7,222.50
Operations Plan (Continued)
CAPITAL
ITEM PRICE QUANTITY TOTAL COST CITATION
Pizza Oven $13,452 1 $13,452.00 Appendix B
Pizza prep Table $2,642.69 1 $2,642.69 Appendix B
Walk in Cooler $14,194 1 $14,194.00 Appendix B
Dough Mixer $2,688 1 $2,688.00 Appendix B
Pizza Cutters $18.95 10 $189.50 Appendix B
Delivery Bags $30.40 15 $456.00 Appendix B
Total Startup Capital Costs: $33,622.19
LABOR
The labor required for pizza cooks will be 150 hours per week.
The labor required for delivery drivers will be 208 hours per week plus delivery costs for an
estimate of 260 deliveries per week.
Pizza cooks cost per week: $1,087.50
Delivery drivers cost per week: $1,708.00
Total Labor costs per week: $2,795.50
Total Labor costs per month: $11,182.00
(See Appendix C)
Critical Risks
It is a risk to only serve pizzas. Some customers prefer something to supplement their
pizza, but it is a calculated risk on our part. The pizza is the most important part of the business,
so we will establish that product first before diversifying. This lack of diversity is an initial risk.
It is always a risk that consumers will be inclined to stick with the tried and true and go
with known quantities. If they are regulars of the other competitors in the area, they may
already have loyalty to those establishments. However, this is another calculated risk and we
have sufficiently differentiated ourselves from competitors.
The Duncan Manor location is near a densely populated area and is next to a road that is
heavily traveled. However, the businesses are not highly visible from the road due to the layout
of the plaza. Duncan Manor Plaza also does not often receive heavy foot traffic. Without
pedestrian traffic, and with low visibility from the road, our innovative approach to marketing
will be vital.
There are risks associated with the sole proprietorship business model as well. It is
harder to secure financial capital in a sole proprietorship. There can be some inefficiencies that
arise due to the small size of the business. As sole proprietor, the owner’s interests will be
divided among many different facets of the business. It will be harder to attract and afford
qualified talent. Also, this is the owner’s first foray into business, and inexperience may cause
difficulty.
Appendix A
LAND
Location:
http://www.loopnet.com/xNet/MainSite/Listing/Profile/Profile.aspx?LID=15918384&SRID=2054608396&St
epID=101
http://www.loopnet.com/xNet/MainSite/Listing/Profile/ListingDemographics.aspx?LID=15918384&SRID=2
054608396&PgCxtGuid=71d26a86-a0fb-4390-8b9a-
4bc8926ce874&PgCxtFLKey=SearchResults&PgCxtCurFLKey=Profile&PgCxtDir=Down
SAUCE
$51.75 for 6 cases of 106 ounce cans= 636 ounces
1 pizza uses ¾ a cup.
1 cup =8 ounces
1 pizza =6 ounces
1 case makes 106 pizzas
Cost per pizza= about $0.48
http://www.foodservicedirect.com/product.cfm/p/3470/Sauce-Contadina-Pizza-Deluxe.htm
DOUGH
Ingredients (1 large crust)
1 (.25 ounce) package active dry yeast
1 cup warm water (110 degrees F/45 degrees C)
2 cups bread flour
2 tablespoons olive oil
1 teaspoon salt
2 teaspoons white sugar
http://allrecipes.com/Recipe/pizza-dough-iii/detail.aspx
YEAST
1 Unit =an 8 pack of 8 ounce packages cost $37.26
1 unit = 64 ounces
Amount per pizza = .25 ounces
1 unit makes 256 pizzas
Cost per pizza = about $0.14
http://www.amazon.com/Bobs-Red-Mill-8-Ounce-Packages/dp/B000EDK774
BREAD FLOUR
1 unit = a 50 lbs. bag cost $44.15
1 unit = 178 cups
Amount per pizza = 2 cups
1 unit makes 89 pizzas
Cost per Pizza= about $0.48
http://www.foodservicedirect.com/product.cfm/p/1157/Flour-Blnc-Higltn-14.2-Percent-Protein-Level-50-
Appendix A (Continued)
OLIVE OIL
1 unit= 5 gallons costs $160.00
1 unit = 1280 tablespoons
Amount needed = 2 tablespoons
1 unit makes 640 pizzas
Cost per pizza = $0.25
http://www.corningoliveoil.com/index.php?main_page=product_info&cPath=10&products_id=26&zenid=o
71m8e0tbuvfpudb75facbht30
SALT
1 unit = 25 lbs bag costs $61.09
1 unit = 1,993 teaspoons
1 unit makes 1,993 pizzas.
Cost per pizza = about $0.03
http://www.amazon.com/Real-Salt-Bulk-Granular-25-pound/dp/B001KWCXEI
SUGAR
1 unit = a case of 8, 5 lbs. each costs $54.75
1 unit = 40 lbs
1 lbs. sugar = 2.25 cups
1 unit = 90 cups
1 unit = 4,320 teaspoons
1 unit makes 2,160 pizzas.
Cost per pizza = about $0.03
http://www.foodservicedirect.com/product.cfm/p/33512/Granulated-Dominos-Foodservice-Sugar.htm
CHEESE
1 unit = 5 lbs. for $13.27
1 unit = 80 ounces
1 unit = 10 pizzas
Cost per pizza = about $1.32
http://www.samsclub.com/sams/shop/product.jsp?productId=102350&_requestid=37868
PIZZA BOXES
1 unit = case of 50 12” boxes for $24.39
Cost per pizza is about $0.48
http://www.wasserstrom.com/restaurant-supplies-equipment/Product_980038
Appendix B
CAPITAL
PIZZA OVEN
Marsal SD-660 STACKED Commercial Gas Pizza
Cooks 12 pizzas at a time
$13,452
http://www.acitydiscount.com/Marsal-Commercial-Gas-Pizza-Oven-36x60-Double-Deck-12-Pie-Capacity-
SD-660-
STACKED.0.114252.1.1.htm?utm_source=google&utm_medium=cse&utm_campaign=cse_goo&PPCID=10&l
ink=Cooking-Equipment
PIZZA PREP TABLE
True Pizza Prep Table TPP-44
$2,642.69
http://www.akitchen.com/store/pizzaprep.html
WALK IN COOLER
PRS2760606-PX Master Bilt Walk in cooler 5’10” x 5’10”
$14,194.00
http://www.jesrestaurantequipment.com/walkin-cooler-indoor-ceiling-mount-floor-510-510-p-
1128403.html?utm_source=googleshopping&gclid=CKCS0qDwsKsCFUJo5QodJlJPgQ
DOUGH MIXER
Globe 20 QT Mixer
$2,688.00
http://www.jesrestaurantequipment.com/walkin-cooler-indoor-ceiling-mount-floor-510-510-p-
1128403.html?utm_source=googleshopping&gclid=CKCS0qDwsKsCFUJo5QodJlJPgQ
PIZZA CUTTERS
Dexter Russell Pizza Cutter
$18.95
http://www.akitchen.com/store/pizcutters.html
DELIVERY BAGS
American Metalcraft (PBDX2005) 20”x20” Deluxe Pizza Delivery Bag
$30.40
http://www.foodservicewarehouse.com/american-metalcraft/pbdx2005/p383024.aspx
Appendix C
LABOR
DELIVERY PEOPLE
$7.25 an hour plus $.75 a delivery
PIZZA COOKS/Cashiers
$7.25 an hour
Weekdays Monday Tuesday Wednesday Thursday
11am-10pm 11am-10pm 11am-10pm 11am-10pm
11 am to 5 pm 1 pizza cook 1 pizza cook 1 pizza cook 1 pizza cook
2 drivers 2 drivers 2 drivers 2 drivers
5 pm to 10 2 pizza cooks 2 pizza cooks 2 pizza cooks 2 pizza cooks
pm 2 drivers 2 drivers 2 drivers 2 drivers
Friday Saturday
11 am to 5 pm 2 pizza cooks 2 pizza cooks
2 drivers 2 drivers
5 pm to 10 pm 3 pizza cooks 3 pizza cooks
4 drivers 4 drivers
10 pm to 2 am 1 pizza cook 1 pizza cook
2 drivers 2 drivers
Sunday
11am to 5 pm 2 pizza cooks
4 drivers
5 pm to 10 pm 2 pizza cooks
4 drivers
Totals per week: Pizza Cooks needed for 150 hours for a total of $1087.50
Drivers needed for 208 hours for a total of $1,508.00 + $200 delivery charges=$1,708
Delivery charges: estimate 260 deliveries (2 pizzas per delivery) per week at .75= about $200/week.