Chipotle joins fast-casual pizza race…

Chipotle joins fast-casual pizza race

Lisa Jennings
Wed, 2013-12-18 15:56
After several years of watching other brands attempt to position themselves as “the Chipotle of pizza,” Chipotle Mexican Grill on Wednesday announced a partnership to grow a fast-casual pizza concept called Pizzeria Locale.

The Denver-based burrito chain has been secretly backing restaurateurs Bobby Stuckey and Lachlan Mackinnon-Patterson — both alums of the The French Laundry restaurant in Yountville, Calif. — for several months. They revealed the partnership this week, along with plans to grow the fast-casual pizza concept.

Pizzeria Locale first opened in 2011 in Boulder, Colo., as a full-service Neapolitan-style restaurant created by Stuckey, a master sommelier, and Mackinnon-Patterson, executivechef. The pizza concept opened next door to their sister restaurant Frasca Food and Wine, a more formal full-service Italian concept, which earlier this year won a James Beard award for outstanding wine service.

After developing a friendship with the two restaurateurs, Steve Ells, Chipotle’s co-chief executive, said he saw the fast-casual potential of Pizzeria Locale.

“Bobby and Lachlan are extraordinary restaurateurs who truly understand what it takes to provide an exceptional dining experience,” he said in a statement. “I have known them for years and I thought their pizzeria in Boulder presented the perfect opportunity to collaborate.”

Terms of the partnership with Pizzeria Locale were not disclosed. Stuckey said Chipotle’s stake in the concept will be determined as the chain grows. Stuckey and Mackinnon-Patterson have maintained full ownership of the original Pizzeria Locale and Frasca.

In May, the partners opened a fast-casual variation of Pizzeria Locale in Boulder with backing from Chipotle. They’re now looking for second and third locations in Denver, with footprints of about 2,000-square feet, and are planning for “slow, measured expansion,” according to Chipotle.

Pizzeria Locale offers a menu of 10 classic pizzas, four American favorites or the option of building your own pizza while walking a service line. The average price for the 10-inch pies is around $6.50.

Stuckey said there are two key aspects that differentiate Pizzeria Locale from the many fast-casual pizza concepts that have come about in recent years. Where some fast-casual concepts are created by “people throwing darts at the wall,” or from scratch, Pizzeria Locale grew out of a proven full-service restaurant, allowing the partners to “distill” aspects that would work for a fast-casual format, said Stuckey.

“The fast-casual model takes a different set of organization and meditation skills,” he said, noting Chipotle’s strong infrastructure and its expertise with throughput and building culture. “We’re all in the hospitality and food business, but building a team for a fast-casual concept is just not the same as it is for a James Beard-award-winning restaurant.”

The second aspect: The partners have designed a proprietary oven that cooks pies at high temperatures in roughly two minutes. The oven is unique because its floor rotates, allowing for more “sweet spots” to produce a more consistent crust.

That means top-quality pies can be produced by less-trained “pizzaiolos,” or pizza chefs, said Stuckey, which lowers labor costs.

The dough at Pizzeria Locale is also prepared from scratch in a separate room kept at a consistent 72 degrees with a humidity level that “mimics Naples on a spring day,” Stuckey said. “No dough will be frozen, and it will all be made on property.”

The menu includes salads and sides, including prosciutto and meatballs. Red and white Italian wine is available on tap and beer by the bottle. For dessert: butterscotch budino.

Entering a crowded space

Mackinnon-Patterson said he and Stuckey “couldn’t be happier” with Chipotle’s support and shared vision of making their pizza accessible to more people.

“We have always admired Chipotle’s pursuit of the best ingredients, its commitment preparing food using classic cooking techniques, and their understanding of what it takes to create a great restaurant experience,” he said. “Through this partnership, we can continue to run Pizzeria Locale with the same energy and passion we’ve always had, but can also look to Chipotle to help with some of the challenges that can become distracting for a restaurateur.”

The concept, however, is moving into an already crowded space in which fast-casual pizza operators are racing for regional and national dominance — many with the support of other deep-pocketed chains and industry veterans.

Los Angeles-based Pizza Rev has the backing of casual-dining powerhouse Buffalo Wild Wings, for example. Sbarro this year launched and plans to grow Pizza Cucinova; and Fazoli’s is scheduled to debut Venti-Tre next year.

The Colony, Texas-based Pie Five Pizza Co. is an offshoot of buffet concept Pizza Inn. The founders of the Smashburger and Quiznos chains recently launched Live Basil Pizza in Denver. Blaze Fast Fire’d Pizza was created by Wetzel’s Pretzels co-founder Rick Wetzel.

And the founders and former CEOs of California Pizza Kitchen are also developing a fast-casual pizza concept to open next year.

Unlike most of the others, however, there are no plans to franchise Pizzeria Locale.

For Chipotle, which operates about 1,550 locations of its namesake concept, Pizzeria Locale joins the company’s portfolio of growth brands. The company is slowly growing the ShopHouse Southeast Asian Kitchen chain, which has six units in Washington, D.C., and the Los Angeles area, with more planned.

Wall Street analysts said the plan to grow Pizzeria Locale fit with Ells’ longtime strategy of applying the Chipotle format to other types of cuisine, as the company has done with ShopHouse, offering new opportunities for growth.

The move does not come without risks, noted David Tarantino of Baird Equity Research in a report Wednesday.

“That said, the short-term risks from rising complexity appear manageable at this stage, and our positive near-term thesis on CMG is intact, given that management will remain mostly focused on capturing the sizable opportunity for the Chipotle brand for the foreseeable future,” Tarantino wrote in the report.