2018:

A BIG YEAR IN BRICK OVENS

As the year comes to a close and we all watch the last glowing embers of 2018 burn down in the nation’s wood fired ovens, the moment is nigh to reflect on the state of affairs in the pizza industry. As we have watched the development of the market over the last twelve months, we can unequivocally state that this year has been a big one in the brick oven world.

The word of the year is market maturation – in the tastes of the average consumer, the culinary/technical sophistication of operators, and the growth in more conservative regional markets. In order to stay ahead in 2019, let’s dive into what made 2018 special and what we can predict to lay over the horizon.

With all of the marketing, real estate, equipment, egos and brands in the industry, it can be easy to forget that the pizza business is about pizza. Consumers vote with their taste buds. While the late ‘00s up to the mid ‘10s were characterized by education about wood fired and Neapolitan pizza (“no, it’s not burnt, that’s leoparding,” “whole pies, no slices”); 2018 onward deals with an audience that has increasing familiarity with a quality brick oven product and expects no less. Neighborhoods and towns that were ecstatic to hear about the first brick oven pizzeria opening are now starting to expect the experience. By no means have we hit market saturation, with 7% annual growth expected to continue well into the 2020s; but we are certainly looking at a better educated audience: This has repercussions across the industry.

One big way pizzerias have used to differentiate themselves in this more educated marketplace is dough. There has been a noticeable shift in operators making the effort to ditch the packets of yeast and move to a naturally-leavened fermentation. Even existing operators with an established dough process made the effort to switch to natural fermentation this year. The natural fermentation process, using wild yeast available in the local atmosphere, offers a unique terroir (“air-roir?”) flavor and generally a richer product – without the need to purchase new equipment or retrofit a dough room. It also makes for a powerful marketing line to consumers, with an ability to push the unique features of a locally made dough. In a competitive market, it allows the operator to demonstrate expertise and add that extra edge over other market players.

Although rapid growth in the independent and multi-store pizzeria segment continues, demand has begun to creep into non-traditional operations.

Anecdotally, in the past year we have seen clients as far ranging as comedy clubs, golf courses, micro-breweries, full-service non-Italian restaurants, and other food service operators make serious investments in serving a quality brick oven pizza product to their existing clientele. This again reflects a level of maturation in the market we have not seen previously.

“Fast-casual” was the catchphrase on everyone’s lips in the past years. Yet, we are now seeing the fast-casual scene split into two business models. On one end, there are operators who have dropped their retail prices and focused on delivering an excellent product, while raising number of clients served in a limited counter-service setting; on the other end, we see fast casual pizza operations shifting back to a more traditional restaurant service, and seeking to raise diner check totals in the process. The businesses that chose to stick with the limited counter-service setting have doubled down on their business model by seeking smaller physical footprints, and taking advantage of rotating oven technology to make up the difference.

Demographically, there has been surprisingly quick growth in the American South and Midwest. An appetite for a higher quality brick oven pizza existed to some extent in urban zones in these regions, but the interest now far exceeds historical patterns. We expect to see continued growth in cities such as Atlanta and Savannah, Georgia; Columbus, Ohio, and other smaller regional cities in those geographic zones.

Pizza Bruno in Orlando, FL – Owner Bruno Zacchini opened his brick and mortar location, and a year later expanded his operation with a mobile catering oven for weddings, parties and other events

The combination of mobile brick ovens and brick & mortar stores are also becoming more sought after across the nation, an effect that partially stems from a search to replace lost take-out revenue. The now ubiquitous rise of UberEats, GrubHub and other tech food delivery solutions has expanded take-out food market options well beyond the traditional take out/delivery pizza business, resulting in lost revenue for a previously guaranteed revenue stream. Independent pizza operators in particular have responded in turn by creating a mobile catering service with mobile brick ovens. On-site catering with a mobile brick oven provides a particularly unique service to consumers that is both highly sought after and maintains high margins for the operator.

The Fiero Forni oven with the largest organic growth demand of 2018 is the rotating oven series. With the maturation in the market, educated pizzaioli have become more difficult to retain and the capital investment of training such specialized staff remains unattractive in many situations. Operators see the rotating oven, which reduces the reliance on these critical staff members, to be a worthwhile solution. The rotating oven is doubly attractive for operators attempting to put out an excellent product in a very small footprint.

PREDICTIONS FOR 2019

In 2019, all industry and economic indicators point toward continued growth in the brick oven pizza industry. We expect a general continuation of 2018 trends well into Summer 2019. Movement of brick oven pizza operations into rural areas and the South and Midwest regions will continue. We believe the mobile brick oven sector is poised to see more growth in 2019 than 2018, as new tech food delivery companies continue to put pressure on independent pizza operators.

We expect to see continued growth in the rotating oven sector, particularly as succesful independent operators expand into multi-location arrangements.

Roman pizza, also known as “pizza al taglio”, is the new buzzword on many people’s lips, and we think we will see the media and consumers build large awareness of this pizza style in 2019. This rectangular pizza has dough characterized by a crunchy bottom and a flavorful, airy, and highly-digestible body. This is achieved via a very high dough hydration rate of up to 90%, with an ultra-extended fermentation process of up to 96 hours (4 days!). The resulting dough flavors speak for themselves, and the baked product acts as an excellent vehicle for a kaleidoscope of toppings ranging from the traditional to the outlandish.

There is enormous potential in the “pizza al taglio” style waiting to be unleashed in the North American market, since the serving method and flavors are much closer to existing consumer sensibilities than the Neapolitan pizza was a decade ago. The “pizza al taglio” sales format also lends itself to a true quick-service format, much like the original New York slice business model. Pizzas are baked and presented at a counter, where the customer can choose their preference and have the slices quickly reheated for consumption on or off premises. In addition to that, the “pizza al taglio” is an excellent vehicle for toppings, which allows operators to localize the pizza and feature regional ingredients more heavily.

In 2019, there are already several market movers in the Neapolitan pizza world who have decided to create Roman pizza concepts. The recognition is that Roman pizza does not in fact exist in the same market space as Neapolitan, allowing for market expansion in the pizza space without cannibalizing existing business. An example is Giovanni Di Palma’s recent decision to open Antico Pizza Romana alongside his succesful Antico Pizza Napoletana concept in Atlanta, GA.  We expect to see more Neapolitan pizza operators follow suit well into 2019 as the industry opens up to this new revenue stream.

– Fiero Staff