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Marco’s Pizza Franchise Uses High-Tech Food Cost Predictor To Drive Results

Posted Feb 23rd, 2016

The top-rated pizza franchise uses analytics to predict food prices, which helps keep costs low for franchisees

Marco's Pizza franchise gets TV attention for updated menus.
Among the top 25 pizza franchises in the United States, only one was founded by a native Italian: Marco’s Pizza®. Pasquale “Pat” Giammarco immigrated to America with his family at age 9, and he started his first pizza restaurant in 1978 in Toledo, Ohio

Marco’s Pizza customers love the fresh ingredients that go into our Ah!thentic Italian Pizza® — the fresh, never-frozen cheeses and the premium meats and vegetables. Getting great prices on those ingredients for our hundreds of locations around the country is a big part of Marco’s Pizza franchise’s success.

Marco’s Pizza has been chosen by the American Restaurant Association — a firm that measures the economics of food commodities — to use a cutting-edge analytics tool that will allow our franchise to study, analyze and predict the costs of all of our highest-quality ingredients. That “crystal ball” will give our franchisees the advantage of lower food costs than other franchises might be able to secure.

“We call it the ‘Marco’s Food Cost Forecaster,’” says Tim Barr, Director of Supply Chain for Marco’s Pizza. “We’ve had a great relationship with the ARA for a long time, and we feel very lucky that they chose us to share their forecasting tools with. Now we can look at market prices for all of our ingredients, from paper and pepperoni, to cheese and flour, and determine what the costs of these products will be from a month out to 18 months out.”

While individual Marco’s Pizza franchisees can rely on our established relationships with distributors when it comes to ordering ingredients, they still foot the bill for the ingredients their restaurants need to keep their hungry customers happy.

“Marco’s Food Cost Forecaster is a tremendous advantage to our franchisees,” Tim says. “They know that we are fighting to get them the best prices for their ingredients. Because we can determine what food costs are expected to be more than a year in advance, it is our job to ensure that we are paying less than the predictive food costs.

“From a franchisee standpoint, food is by far their most variable cost. With this tool, we can better determine when to buy ingredients and how much of the ingredients to buy when the time is right.”

The forecaster will also have a positive strategic impact on other aspects of the Marco’s Pizza franchise.

“It will definitely play into our marketing efforts,” Tim says. “If the price of pepperoni is supposed to be especially high in November, it will not be a good time to market our pepperoni pizza, but it may be a good time to feature chicken.”

Marco’s Pizza is making the information derived from Marco’s Food Cost Forecaster available to our franchisees and also will provide a deeper dive into the analytics.

“We’re here to support the franchisee,” Tim says. “Our job is to make their lives easier as business owners so that they can concentrate on making their stores successful.”

A bright future for a worthy brand

Unlike competing chains — such as Pizza Hut, Domino’s and Little Caesars — who have saturated their markets, Marco’s Pizza has plenty of prime territories available for new franchises.

“We aren’t tapped out like our competitors,” Chief Development Officer Cameron Cummins says. “There is so much room left for Marco’s to grow. We have many regions available for multi-unit development.”
When our guests order from Marco’s Pizza, they know they are getting the best. We make our pizza dough in each store from spring wheat flour, specially filtered water and high-quality yeast. We then add our tasty sauce, which was developed by our founder and his father, made from blended tomatoes and proprietary spices. Our pizzas are then topped with a blend of Wisconsin cheeses, chopped fresh vegetables and premium meats.

“Almost half of our franchisees were consumers first; 100% of the people in our organization are here because they love our product,” Cameron says. “If you serve a great-tasting pizza, the business will follow. In our industry, you are only as good as your last pizza, and our customers keep buying from us because our pizzas taste better.”

Build your success on ours

Founded in Toledo, Ohio, in 1978, Marco’s has become one of the fastest-growing pizza franchise chains in the nation. Our homemade recipes and fresh ingredients are in the Italian tradition, and we are the only top 20 pizza franchise in the country that was founded by a native Italian. We are led by veteran pizza executives who have experience growing brands and supporting franchisees as they grow their businesses.

Marco’s Pizza™ franchise
Marco’s Pizza franchise is one of the fastest-growing large pizza chains in the country. We expect to have 1,000 stores open by the end of 2017.

The brand’s proven business model and sustainable growth have been heralded by the likes of Forbes, Consumer Reports, Nation’s Restaurant News, Franchise Times and now Entrepreneur with inclusion of Marco’s Pizza on the Franchise 500 list for 2016.

Marco’s has enjoyed stunning growth in recent years and is on pace to have 1,000 restaurants open by the end of 2017. The dynamic pizza franchise rolled out 113 new franchises in 2015 and has recently announced plans to open 150 more locations in 2016. Marco’s Pizza has the fastest unit growth, according to Nation’s Restaurant News, which named the beloved pizza franchise as part of its Second 100 List. That list analyzes businesses that are smaller but are focusing on growing around the nation.

Learn more about Marco’s Pizza

For in-depth details about the Marco’s Pizza® franchise opportunity, download our free franchise report. You can also learn more by visiting our research pages.

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