April 22, 2020

Pizza Becomes a Bright Spot in Food Delivery

 |  By: Fran Howard

Demand for Mozzarella cheese has been growing steadily over the past decade and will likely fare better than other dairy products during the coronavirus pandemic—thanks in large part to pizza, both delivered and frozen. 

“Within the foodservice industry, pizza delivery restaurants appear to be most unaffected by Covid-19,” says Betty Berning, analyst with the Daily Dairy Report. Several large pizza chains, including Pizza Hut, Papa John’s, and Domino’s, are hoping to increase their workforces this year as robust demand continues. Together the three pizza chains are expected to hire an additional 60,000 workers in 2020. 

“By simplifying their application process and reducing training time, these pizza chains expect to get employees hired and on-the-job soon,” Berning says. “Restaurants that offer pizza as only one of many menu items as well as pizza restaurants that did not offer takeout and delivery before the pandemic began are likely not doing as well as those that already had a delivery model in place.”   

Pizza delivery restaurants are weathering the Covid-19 pandemic better than other restaurants for several reasons, according to Berning. “First, they are accustomed to operating on a delivery model, and many already had digital ordering available and did not need to implement new systems when the pandemic began,” she says.

Second, Berning notes that many of the large pizza chains have also improved their delivery model by offering no-contact delivery, which provides consumers with a sense of confidence and safety. In addition, consumers are more accustomed to having pizzas delivered to their homes compared to other types of entrees. And finally, she says, pizza is relatively inexpensive. “With unemployment and recession concerns growing, some families are likely ordering pizza delivery to keep costs down, while others are popping frozen pizzas into the oven to enjoy a night off from cooking,” she adds.

In March, the month most state’s began their shelter-in-place and stay-at-home orders, Americans bought $275 million worth of frozen pizza, according to Adweek. While this is an overall increase of 92 percent compared to March 2019, some brands reported sales increases of as much as 190 percent. Adweek notes that the increase in frozen pizza sales is akin to the spike in toilet paper sales. Americans purchased 104 percent more toilet paper in March, compared to the prior year, as they began hoarding the product prior to state shutdowns.

While the nearly complete shuttering of the U.S. foodservice industry has annihilated a large share of dairy product demand, Mozzarella orders likely have not declined as much as those for the other dairy products used heavily in foodservice, such as butter and processed cheeses, according to Berning. 

Last year, U.S. cheese makers produced approximately 4.5 billion pounds of Mozzarella, a made-to-order product used mostly in pizzas and other Italian cuisines. USDA will release March dairy product production data on May 5, providing the first look into just how well Mozzarella production is faring in the face of the pandemic.