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Cheese Price Increases are Grating to Pizza Franchises

Pizza franchises throughout the U.S. are struggling with escalating costs of cheese. Block cheddar cheese – the benchmark for mozzarella and other cheeses – reached $2.08 a pound Thursday on the Chicago Mercantile Exchange, up 78 percent from $1.17 a pound a year ago. Industry observers attribute the price surge to strong demand and higher production prices – from the cost of milk to the cost for dairy farmers to feed their herds. Pizza Hut and Papa John’s International have raised their cheese-only pizza prices, and smaller restaurants, including Fat Jimmy’s in Louisville, Ky., have raised prices, too.

Papa John’s uses about 100 million pounds of cheese each year, and the cheese typically makes up 35 percent to 40 percent of the food cost in making a pizza.

Read the story
“Pizza makers struggling with higher cheese costs” by Bruce Schreiner in the Daily Herald.Something tells me that America’s Desire for pizza will remain.

According to Pizzaware .com

  • Americans eat approximately 100 acres of pizza each day, or about 350 slices per second.
  • Pizza is a $30+ billion dollar per year industry. There are approximately 69,000 pizzerias in the United States. Approximately 3 billion pizzas are sold in the U.S. each year. (Source: Blumenfeld and Associates)
  • Pizzerias represent 17% of all restaurants. (Source: Food Industry News.)
  • Pizza accounts for more that 10% of all foodservice sales. (Source: Food Industry News.)
  • 93% of Americans eat at least one pizza per month. (Source: Bolla Wines.)
  • 66.66% of Americans order pizza for a casual evening with friends. (Source: Bolla Wines.)
  • Each man, woman and child in America eats and average of 46 slices, (23 pounds), of pizza per year. (Source: Packaged Facts, New York.)
  • Italian food ranks as the most popular ethnic food in America. (Source: National Restaurant Association.)
  • According to a recent Gallop Poll, children between the ages of 3 and 11 prefer PIZZA over all other food groups for lunch and dinner.
  • A study done by a U.S. Department of Agriculture statistician and home economist found that in a three-day survey period, 42% of children between the ages of 6 and 11 has eaten pizza. (Source: Smithsonian Magazine.)
  • 94% of the population of the U.S. eats pizza. (Source: Parade Magazine.)

Cross Posted at: Let’s Talk Franchising

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