Why the Country Lost Its Appetite for the Pizza Hut Chain

In the past, the popular pizza chain was the top choice for groups and loved ones to indulge in its eat-as-much-as-you-like offering, endless salad selection, and ice cream with toppings.

Yet fewer customers are choosing the brand nowadays, and it is closing a significant portion of its UK outlets after being rescued from insolvency for the second instance this calendar year.

I remember going Pizza Hut when I was a child,” says one London shopper. “It was a regular outing, you'd go on a Sunday – turn it into an event.” However, at present, aged 24, she says “it's no longer popular.”

For a diner in her twenties, certain features Pizza Hut has been famous for since it launched in the UK in the 1970s are now outdated.

“How they do their all-you-can-eat and their salad station, it feels like they are lowering standards and have inferior offerings... They offer so much food and you're like ‘How can they?’”

Because ingredient expenses have risen sharply, Pizza Hut's unlimited dining format has become very expensive to operate. Similarly, its locations, which are being reduced from a large number to just over 60.

The chain, like many others, has also seen its costs rise. In April this year, staffing costs jumped due to increases in the legal wage floor and an rise in employer national insurance contributions.

A couple in their thirties and twenties explain they would often visit at Pizza Hut for a date “from time to time”, but now they get delivery from Domino's and think Pizza Hut is “not good value”.

Depending on your choices, Pizza Hut and Domino's rates are similar, explains a food expert.

Even though Pizza Hut provides pickup and delivery through third-party apps, it is losing out to major competitors which focus exclusively to this market.

“The rival chain has succeeded in leading the off-premise pizza industry thanks to strong promotions and constantly running deals that make consumers feel like they're saving money, when in reality the standard rates are relatively expensive,” explains the analyst.

Yet for the couple it is justified to get their special meal delivered to their door.

“We absolutely dine at home now rather than we eat out,” comments the female customer, reflecting current figures that show a decline in people going to informal dining spots.

During the summer months, quick-service eateries saw a six percent decline in customers compared to the previous year.

There is also another rival to ordered-in pies: the frozen or fresh pizza.

A hospitality expert, head of leisure and hospitality at an advisory group, points out that not only have supermarkets been providing high-quality prepared pies for a long time – some are even offering countertop ovens.

“Lifestyle changes are also contributing in the popularity of quick-service brands,” states the analyst.

The rising popularity of low-carb regimens has increased sales at poultry outlets, while reducing sales of carb-heavy pizza, he continues.

Since people visit restaurants not as often, they may prefer a more upscale outing, and Pizza Hut's American-diner style with booth seating and traditional décor can feel more retro than premium.

The “explosion of artisanal pizza places” over the last 10 to 15 years, including boutique chains, has “fundamentally changed the consumer view of what good pizza is,” notes the industry commentator.

“A light, fresh, easy-to-digest product with a carefully curated additions, not the overly oily, dense and piled-high pizzas of the past. That, I think, is what's led to Pizza Hut's decline,” she comments.
“Why would anyone spend nearly eighteen pounds on a modest, low-quality, underwhelming pizza from a chain when you can get a stunning, expertly crafted classic pizza for a lower price at one of the many traditional pizzerias around the country?
“The decision is simple.”
Dan Puddle, who operates a small business based in a regional area says: “It's not that lost interest in pizza – they just want improved value.”

Dan says his adaptable business can offer high-quality pie at accessible prices, and that Pizza Hut faced challenges because it could not keep up with new customer habits.

According to an independent chain in a city in southwest England, the proprietor says the pizza market is diversifying but Pizza Hut has neglected to introduce anything new.

“Currently available are by-the-slice options, artisanal styles, New Haven-style, artisan base, wood-fired, deep-dish – it's a wonderful array for a pizza-loving consumer to discover.”

The owner says Pizza Hut “should transform” as the youth don't have any sense of nostalgia or allegiance to the company.

Over time, Pizza Hut's market has been sliced up and allocated to its fresher, faster competitors. To sustain its costly operations, it would have to increase costs – which experts say is difficult at a time when household budgets are shrinking.

The managing director of Pizza Hut's international markets said the buyout aimed “to ensure our guest experience and retain staff where possible”.

It was explained its first focus was to keep running at the open outlets and delivery sites and to assist staff through the change.

Yet with large sums going into operating its locations, it probably cannot to allocate significant resources in its off-premise division because the market is “complicated and working with existing delivery apps comes at a price”, analysts say.

But, he adds, lowering overhead by exiting crowded locations could be a effective strategy to adapt.

Carly Petty
Carly Petty

A passionate writer and thinker sharing personal insights and experiences to inspire others.