Pizza Pizza vows to tackle Mexico’s low pizza habits

An American pizza chain plans to open the first restaurant in Mexico in 12 months – this time in a sleek, ultramodern venue in a swish part of a country rich in food, art…

Pizza Pizza vows to tackle Mexico's low pizza habits

An American pizza chain plans to open the first restaurant in Mexico in 12 months – this time in a sleek, ultramodern venue in a swish part of a country rich in food, art and culture.

Mexico City-based Pizza Pizza, which has 19 franchised outlets across the US, signed a master franchise agreement last month to open up to 40 cafes in Mexico over the next five years, according to government filings.

The state-of-the-art two-floor space slated to open in Mexico City’s trendy Plazuela la Condesa is part of a plan to open new cafes to kick-start its growth in Mexico, where less than 10% of Mexicans live in the capital city and tacos are served up mainly in bars, restaurants and street food carts.

The Mexican government’s economic reform plans of past years has helped create openings for companies to look beyond the country’s big cities, with restaurants and fast-food outlets popping up in towns, villages and rural areas that had not traditionally been part of the sector.

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But Pizza Pizza is undeterred by Mexican food’s somewhat controversial past, and says it wants to offer a new food innovation: pizza, with pizza boxes. Unlike rivals, the restaurants will use refrigerated piping-hot pizzas.

“We are different because we use the pizza [box], so you know the pizza is hot in 10 seconds,” said Irena Lembo, who heads Pizza Pizza’s franchise business and declined to comment on how much it will cost to set up in Mexico, but said the cost of construction will be “competitive”.

Asked if he was worried by entrenched habits at home, Lembo said: “Mexico is a very strong society, but a noisy one. People are respectful when they come to our restaurants. We love it here.”

Pizza Pizza has hired former restaurateur Carlos Morales to develop the new food concepts, and plans to open a store this year in the northern border city of Ciudad Juárez, considered one of the toughest corners in Latin America for immigrant recruitment, and to double the number of stores in the city over the next five years.

The Mexican interior ministry has contributed financing to support Pizza Pizza’s Mexican foray and Lembo said she hopes to tap into more public and private investment as part of a new policy to foster growth in small and medium-sized businesses.

About 58% of Mexicans live in poverty, and a weak peso currency has hit exports. Several Mexican companies operating in Latin America have struggled to raise funds.

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These include Jack Daniel’s whiskey maker Brown-Forman. Its net profits dropped 23% in 2017, while Chivas Brothers maker Diageo recently warned that its business in Mexico was contracting, an unexpected slowdown that sent its shares lower.

Company officials in Mexico were not immediately available for comment on other risks to local growth.

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