Essay About Take-Out Pizza Industry And Pizza-Hut

Marketing – Pizza Industry
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Summary
Microenvironment
The four major competitors, Pizza-Hut, Papa Johns, Dominos, and Little
Ceasers are the market leaders in the take-out pizza industry. Having a strong brand
equity in the take-out pizza industry allows a company to gain a significant advantage
in the market. Customers in the take-out pizza industry place a high value on the product
quality and price of a company. Maintaining a good reputation is very important in this
industry for companies because customers will build a relationship with the company and
will keep on coming back or ordering from that company if they feel like they are getting
a good deal. Even though the take-out pizza industry is very competitive, many investors
will surely be looking for investment opportunities in the years to come due to the growth
potential in the industry.
Macroenvironment
The demographic factors in the take-out pizza industry have provided new
positive opportunities for companies in the industry. Economic factors can also influence
the industry in a positive or negative way during a good or bad economy. Ecological
factors such as rising prices in gas and rising prices on dairy products has hurt the
industry. Technological factors are helping companies meet new customer needs and
demands and are opening up new opportunities for companies all around the world.
Political and legal factors have not had a tremendous recent impact on companies in the
industry. Cultural factors that have affected the take-out pizza industry have been
primarily the increase in consciousness of health and fitness among the public in the
United States.
Microenvironment
Those factors that are close to a company, that affect its ability to serve its
customers, are called its microenvironment. There are several factors that affect the
microenvironment of a company in the take-out pizza industry mentioned in this report.
They include the industrys market, the industrys competitors, its customers, and
the industrys promotion and distribution of its products.
A. The Market in the Take-Out Pizza Industry in the U.S.
The market for the take-out pizza industry in the United States is fairly large and
not to mention very competitive ( Competitors are talked about later on in this report).
While there are four major companies, Pizza-Hut, Dominos, Papa Johns, and Little
Ceasers, that own 31.7% percent of the market in this industry, 68.3% percent of the
market is dominated to what are known as “other” businesses. These “other” businesses,
some of which are well known, include the hundreds of small companies or family-
owned businesses, that most people do not even realize compete in the pizza industry.
The 68.3% percent statistic shows that due to the fact that there is a very large market for
pizza in the United States, the pizza industry is open to a lot of businesses, which causes
the competition to intensify. Another statistic that should intensify the competition in the
next several years is the growth potential that is predicted to occur in this industry.
According to Yahoo Finance, the growth potential for the pizza industry in the next five
years is estimated to be about 12.4% percent. This number or percentage will probably
surprise a good number of people, especially since Papa-Johns has just recently
announced that it had to lay-off some employees due to losses in the company.
Regardless of this announcement, the pizza market in the United States is sure to attract
more businesses because of the growth potential in this industry in next several years.
B. Competitors in the Take-Out Pizza Industry
The take-out pizza industry is an extremely competitive industry. The reason this
industry is so competitive is because there are four major competitors in this industry
that not only compete against each other, but also against hundreds of other companies
or private businesses. The four major competitors in the take-out pizza industry are Pizza-
Hut, Papa Johns, Little Ceasers and Dominos. Pizza-Hut has a bit of an advantage