Pizza Hut Delivery boss expects popularity of delivery to continue post-reopening

06 May 2021 by
Pizza Hut Delivery boss expects popularity of delivery to continue post-reopening

Neil Manhas, managing director and chief financial officer of Pizza Hut UK and Ireland (pictured), has said he is optimistic the increase in popularity of delivery services over the last year will continue post-pandemic.

Speaking to The Caterer, Manhas said the business did not see any "softening" on the delivery side when restaurants reopened last summer and during the Eat Out to Help Out scheme.

"That's not to say what happened then will be the blueprint for what might happen going forward. Consumers just ended up doing both by the looks of things, which bodes well," he said.

"Of course people will go back to dining out. I think there will be a big surge of that, it's a very important part of our culture, but there has been a shift and I think it will sustain. It might not sustain at 100% of where it was before, but I think it's going to be somewhere in that region. It's been such a long passage of time that habits, behaviours and preferences have started being reshaped through it."

After more than a year of lockdowns and social restrictions that has seen a boom in food delivery, Manhas said the business has seen strong double-digit growth on a like-for-like basis over the last two years and an uptick in frequency of orders from existing customers, as well as an increase in new customers. Pizza Hut Delivery also started working with platforms such as Just Eat and Deliveroo for the first time last year, which it will continue after reopening.

"Our direct channels are still very much our big category, and I think that's a good place for us to be in," he said. "Our digital direct sales are in the region of 80%... I think we're in a healthy place and it feels like those relationships are working for both sides."

Late last year Pizza Hut Delivery announced it would open 125 new franchised stores by the end of 2023, creating 2,500 jobs. So far in 2021, Starboard Dining has joined as the latest franchisee, which will see it become the franchisee for 27 existing delivery and takeaway Pizza Huts across the Midlands, Yorkshire and the north west of England, the renovation of existing sites and new sites opening this year.

Pizza Hut operates more than 700 sites across the UK including approximately 350 delivery venues. The Pizza Hut brand is owned by Yum Brands, which also includes KFC and Taco Bell in its portfolio.

Manhas expressed excitement about the sites that had already been identified although admitted it was a "particularly tough time" to find A5 sites, which were becoming "increasingly rare" as more operators have moved into the delivery space. Taking into account pipeline sites that will inevitably fall through, he said: "Almost for every one store that you want to open you need to be looking at double that."

Although the responsibility of Pizza Hut's franchise partners, there are also 2,500 new roles to recruit to staff the new sites despite concerns in the sector.

Manhas said: "That will continue to be the ongoing challenge, making sure that we have sufficient drivers in an industry where I think more delivery will be sought after, and it's not just food delivery. That will remain a pressure point for us and we need to make sure we have the right strategy."

The restaurant side of the business, which is separate to Pizza Hut Delivery, has not necessarily been such a positive story, and the brand underwent a CVA last year that saw 29 restaurant closures and 450 job losses. However, Manhas said following the CVA, Pizza Hut Restaurants was "in as good a position as it can be".

"It's a challenging environment," he said, "but equally being able to have some consolidation of the estate has put them in a place that will set them up for success."

He added: "It's been quite a journey over the last 12 months and will have been for every business. We are actually in a very strong place and we're all very grateful for that… and now our sights are very much on making sure that's just a stepping stone for the next chapter ahead."

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