California Pizza launches the conquest of Mexico

Despite the fact that in early May restaurant controller Alsea decided to terminate its operations contract in Mexico from California Pizza Kitchen (CPK), the franchise will continue growing in the country, said in an interview with MILENIO Jim Hyatt, global CEO of the brand.

California Pizza in Mexico. Image: CPK
California Pizza in Mexico. Image: CPK

"We want to have special locations, so we believe that Alsea made a good decision. There is a lot of opportunities, but we do not want to be a brand that grows in this way, that is, we do not want to be in every corner of a neighborhood," said the manager of the casual dining segment, or informal food.

Alsea decided to divest the brand under a scheme of asset leasing and transfer of operating rights to the brand's new franchise, Opcal. Said agreement entered into force on May 8; The decision, which is part of the restructuring of the operator's portfolio, is the second divestment he has announced after he stated that he would leave Burger King's master franchise in Mexico.

The company, which has more than 10 years of work in the country, currently has units in cities such as Querétaro, Toluca, Monterrey, Mexico City, and León. His plan is to expand not only the number but the regions in which he has a presence; However, the manager pointed out that this will happen once the existing units operate optimally.

"The economy of Mexico is very stable and strong. This is our largest market outside the United States and has helped develop the Latin American region."

According to figures from the market researcher Euromonitor International, to 2017 the pizza sector in the country reached a value of 4 thousand 539 million dollars. It is estimated that by 2022 it will reach 5 thousand 312 million dollars.

The category is led by Domino's Pizza, with 5.1 percent participation; followed by Little Caesar's, with 2 and Pizza Hut, with 1.9 percent. Behind are Benedetti's Pizza and Papa John's.

According to Fabián Gosselin, CEO of California Pizza Kitchen Mexico, the new strategy of the brand will also involve the incursion of delivery services -delivery at home-, since these have had an important growth in the country.

According to data from the Online Sales Study Mexico 2019, of the Mexican Online Sales Association (AMVO), home-based food was the second category with the highest penetration during 2018 among Mexican Internet users; with a 67 percent share, it was only below fashion, with 77 percent.

"To the extent that the operators have made this distribution easy, we have to use that channel to have more products, we are going to use third parties. We launched something with Uber Eats last week and we will probably venture with two or three aggregators".

The strategy will be to work with these services, innovations in menu and execution in store towards the end of the year, and it will be afterward when analyzing the possibility of opening new business units.

"At some points, the delivery channel represents about 30 percent of our business, we want to be available in all sectors," Hyatt said.

4,539 million dollars is worth the pizza sector in Mexico and it is estimated that by 2022 it will reach a figure of 5 thousand 312 million, according to Euromonitor.

5.1% is the market share held by the leader of the Domino's Pizza segment, followed by Little Caesar's (2%) and Pizza Hut (1.9%).

Source: Milenio

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