With The Kraft Group’s backing, New Orleans-based Naked Pizza is preparing for a nationwide expansion.
They made their fortune in paper products, and they earned their fame with football. Now the Kraft family is turning to pizza for their latest venture.
But it wasn’t just any old tomato sauce and mozzarella pie that inspired the Krafts to branch into investing in a restaurant chain for the first time.
The founders of Naked Pizza believe they’ve come up with a pizza that not only tastes good, but is good for you, too. The company only has one shop, a 500-square-foot takeout joint in New Orleans. However, with The Kraft Group’s backing, Naked Pizza is preparing for a nationwide expansion. In the past two months, Naked Pizza says it signed franchise agreements to open shops in Kentucky, Florida, New York and Colorado.
Dan Kraft, executive vice president at the Kraft Group in Foxboro, says he expects Naked Pizza’s first New England franchise agreement will be signed within the next 30 days. He says negotiations are on track for opening a few Naked Pizza shops in Massachusetts within the next 12 months.
The Naked Pizza concept received a key infusion of cash when the Kraft Group bought a meaningful stake in the company last year. The move followed on the heels of an initial investment by Mark Cuban, the billionaire owner of the Dallas Mavericks.
Before deciding to invest, Dan Kraft says his family had followed Naked Pizza through the company’s active Facebook and Twitter posts (Twitter lists Naked Pizza among its “case studies” of how a business can use the social networking tool).
Dan Kraft says healthy, all-natural pizza seemed like a promising concept. But he knew it wouldn’t be successful if the pizza didn’t taste good. His skepticism faded after the Naked Pizza folks trekked up to Gillette Stadium last summer to bake the pizza in the stadium kitchen and give the Krafts a firsthand look. Dan Kraft says he was pleasantly surprised by how good the pizza tasted.
When the Patriots played the Saints in New Orleans last November, the Krafts shared the locally-baked pizza with their guests at the football game. Dan Kraft says no one seemed to notice that they were actually eating health food.
The company that had first billed itself as “World’s Healthiest Pizza” claims it can live up to that title – even though it dropped the name in favor of the more accessible Naked Pizza. Co-owner Robbie Vitrano says the pizza’s creators focused on the crust, creating a mix of about a dozen grains while keeping sugar and butter out of the dough.
The result: A large pizza packed with dietary fiber that has fewer than 165 calories per slice – or about 115 for the thin crust option.
Prices are fairly comparable to what you would pay at other pizza shops. At the New Orleans location, the prices range from $8 for a small cheese pizza to $16 for large specialty pies such as the Veggie Combo and the Creole Cajun Throwdown.
The concept is designed as a takeout-and-delivery model. By avoiding full-service dining operations, Vitrano says franchisees can keep operations streamlined and free of unnecessary distractions. Most locations will likely be 800 square feet to 1,200 square feet in size, or about twice the size of the original shop that opened four years ago.
With the Kraft Group’s help, Vitrano says Naked Pizza should have 20 to 40 franchisee-owned stores opened by the end of the year, and as many as 150 by the end of 2011. The weak commercial real estate market works in Naked Pizza’s favor, as franchisees should be able to negotiate favorable lease terms for many locations.
Vitrano says the growing demand for healthy foods could eventually support more than 1,000 Naked Pizza locations across the country.
Building a national chain restaurant from scratch isn’t easy, particularly in the crowded pizza shop category.
Darren Tristano, executive vice president at restaurant consultancy Technomic Inc. in Chicago, says a pizza chain needs a differentiating factor to have a good shot at success. Pizza Fusion aims to attract the environmentalists. Pizza Patron targets the Hispanic market. Little Ceasars and CiCi’s, with their $5 options, simply offer the cheapest pizza around.
That’s why Tristano sees a potential opportunity for Naked Pizza. He says it’s too early to know if Naked Pizza will be successful. But he says there’s still plenty of room to grow for fast-food chains that target consumers with healthy lifestyles.
There are certainly enough people who want this type of product, Tristano says. It’s just a question of finding where they live – and setting up shop in their neighborhoods.
Dan Kraft says the Kraft Group will assist Naked Pizza with that process by helping pick the right franchisees for the right markets. While the family’s company has no plans to open its own Naked Pizza franchise, the Kraft Group’s equity investment still represents a big bet on Naked Pizza’s future.
Based on the Patriots’ record for the past 10 years, the Krafts have done a good job picking winners on the football field. Now, they’re hoping that skill will pay off in an entirely new arena.
Jon Chesto is the business editor of The Patriot Ledger. He may be reached at firstname.lastname@example.org.