Milling & Baking News - January 21, 2014 - 9

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Chipotle entering pizza with
Pizzeria Locale fast casual concept
ORLANDO, FLA. - For Chipotle
Mexican Grill, Inc., entering the
piping-hot pizza market wasn't much
of a stretch.
Last month, the Denver-based
burrito chain announced a partnership
to launch a fast-casual pizza concept
combining Chipotle's operational style
with Neapolitan-style pizza. Based on
a full-service restaurant of the same
name, Pizzeria Locale opened its first
fast-casual location in Denver in May
and is exploring options for additional
locations in Denver.
"Certainly, pizza is a favorite in
this country," said Steve Ells, founder,
chairman and co-chief executive
officer of Chipotle, during a Jan. 14
presentation at the Integrated Corporate
Relations XChange in Orlando. "It's
a big, big opportunity. But a lot of the
pizza out there, most of it, is pizza that
is cheaper ingredients, all based on the
same model, heavily discounted, very
much a fast-food kind of model."
The difference is in the dough, he said.
Made with Italy-milled flour, Pizzeria
Locale's dough is fermented for 24 hours,
"which develops incredible flavor and
incredible texture," Mr. Ells said.

The made-to-order pizzas are baked
in two minutes.
"And while that pizza is baking,
customers are then going down the salad
line, getting salad, sides of meatballs,
prosciutto, and then beverages and by
the time they pay, their pizza's ready
and they sit down," Mr. Ells said.
Pizzeria Locale founders Bobby
Stuckey and Lachlan MackinnonPatterson opened the original full-service
location in Boulder, Colo., in 2011.
"I've been working with Bobby and
Lachlan and have been associated
with them for over 10 years," Mr.
Ells said. "And when they opened up
this pizzeria, I knew that this had the
makings for a pizzeria that could fit
into the Chipotle format so that you
could have delicious food prepared
individually for the customer with a
high throughput model that would
have similar economics to Chipotle."
Pizzeria Locale's menu includes
eight Naples-inspired pizzas in
addition to build-your-own pies
from a selection of ingredients on
an interactive service line. Toppings
include broccolini, capers, eggplant,
gorgonzola and smoked prosciutto.

Krispy Kreme eyes 'more rapid'
growth for U.S. operations
ORLANDO, FLA. - For Krispy
Kreme Doughnuts, Inc., 2013 was a
year full of news with an international
flavor, from the company's announcement in January that it would be entering India to its September statement it
would set foot in South America.
But in a Jan. 13 presentation at
the Integrated Corporate Relations
XChange, James Morgan, chairman,
president and chief executive officer
of Krispy Kreme, said the Winston-Salem, N.C.-based company now has the
building blocks in place to start growing its domestic business "at a more
rapid pace."
"Our domestic growth has not been
nearly as dramatic as has been our
international growth, but that is now
starting to change," Mr. Morgan said.
"We have spent the last five years rethinking our domestic business model, building our marketing capabilities, coming to better understand our
consumers, and improving our dayto-day execution skills. The building
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blocks are now in place to start growing our domestic business at a more
rapid pace."
He said Krispy Kreme "took a big
step forward" when it refranchised
three shops in Dallas and signed a
15-store development agreement with
a major multi-concept operator in that
market. Krispy Kreme also signed a
10-store development agreement for
Houston and a 4-store agreement for
Anchorage, Alaska.
"We anticipate signing additional
domestic development agreements
in the coming quarters and years,"
he said.
For company shops, Krispy Kreme
has set its sights on the Southeast,
with focus on small, freestanding
factory stores that will not participate in wholesale distribution to
grocers, mass merchants, or convenience stores.
"These small footprint stores are
very important to our future growth,
and we are pleased with the results we

Business

A gluten-free crust also is offered.
"So I see an extraordinary
opportunity to offer this very, very
high-quality Neapolitan-style pizza
within the Chipotle format and also
economic model," Mr. Ells said.
Chipotle also operates a fast-casual
concept called ShopHouse Southeast

Asian Kitchen, which serves noodles
and rice bowls at six locations with
additional units opening in the coming
months.
"...the key to Chipotle and
ShopHouse and now Pizzeria Locale
is that these are highly customizable
experiences that people get not only
what they want for taste, but also
for diet and to be able to be highly
customized and very, very fast, I
think, is the special combination,"
Mr. Ells said. MBN
are seeing thus far from the seven new
shops we have built," he said.
Mr. Morgan said the oldest of the
seven freestanding factory stores has
been open less than a year, but results
give Krispy Kreme "great confidence"
in the model.
"Substantially all of our company
shop growth next year will be in the
new format, and we expect you will
also see domestic franchisees opening these new small format shops next
year as well," he said.
Outside of the Southeast, Krispy
Kreme plans to grow through franchising as the company opens up the
vast portion of the United States that is
yet to be franchised, Mr. Morgan said.
"We have put new and proven resources in place to lead our domestic
franchise recruiting efforts," he said.
"Moreover, we are seeing increased
development activity with our existing franchisees and now forecast they
will open between 20 and 25 new
shops in our next fiscal year."
Krispy Kreme has more than 810
locations in 24 countries, including
94 company stores in the United
States. MBN
Milling & Baking News January 21, 2014 / 9

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Milling & Baking News - January 21, 2014

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