Pizza franchises Pizzeria Uno and Boston’s Pizza Restaurant and Sports Bar are among restaurant concepts looking to find new ways to attract consumers whose eating habits have changed during the pandemic, and are turning to hotels.
Boston has already opened a handful of hotel restaurants, including its first at a Holiday Inn in Little Rock, Arkansas. “It has gone extremely well,” said President Jeff Melnick. The brand also has a partnership with a Four Points by Sheraton hotel in Yuma, Arizona, as well as a unit at a Wyndham hotel in Deadwood, South Dakota.
Melnick, who runs Boston Pizza’s U.S. subsidiary based in Canada, said Boston was looking for a non-traditional opportunity to capitalize on and found one in the hospitality space, where hoteliers see their restaurants as a space that’s losing or losing money hardly makes any money. Many try to create their own concept or have a flag concept that consumers don’t like.
“Bringing in a reputable brand and having it in their facility not only helps them make the hotel itself more attractive, which helps them fill rooms, but also allows them to be the franchisee,” Melnick said. “You have more control.”
Boston also handles catering for the hotel, Melnick said.
For Boston, much of the appeal is the exposure the brand gets from all foot traffic at hotels, Melnick said. The majority of Boston’s 400+ locations are in Canada, where it has a broader brand awareness that is still being built in the United States.
The investment required to open a Boston’s Pizza in the United States ranges from $1 million to $2.76 million for traditional stores.
Two of Pizzeria Uno’s first three remodeled hotels were in the middle of a remodel anyway, so they had to add Uno’s signature pizza ovens and a few other supplies, but the restaurant space was already in place. Uno’s hotel locations are in Chicago, Detroit and northern Indiana. The first of the hotel renovations opened in March at a Comfort Suites near Chicago’s O’Hare Airport.
“I’m not convinced that what we asked them for was significantly different than what they were likely to spend anyway,” said CEO Erik Frederick. “And that really got us thinking that maybe there are others.”
The Uno Hotel’s Detroit location is at a Delta by Marriott property, and the Indiana location is under the Wyndham umbrella.
The franchise was founded in Chicago and is currently headquartered in Boston. It has 100 locations in 20 US states, Honduras, Saudi Arabia, India and Qatar.
From these three hotel restaurants, Frederick wants to turn 100 hotel restaurants by the end of 2024 – not only through renovations, but also through new buildings, he said.
The revenue generated by these hotel renovations is “phenomenal,” Frederick said.
Revenue doubles compared to previous hotel restaurants due to all the revenue streams from hotel guests, local traffic and delivery.
“I’m sure you’ve stayed at a hotel before where you see all that takeout pizza walking through the front door from somewhere nearby,” Frederick said. “Well, now they get that revenue.”
And hotel operators are already in a hospitality-centric franchise, which has been a big appeal of the transition, Frederick said.
The investments required to open a Pizzeria Uno franchise range from $503,500 to $1.24 million for a fast casual unit and $1.2 to $2.5 million for a business with comprehensive service.
Read more about Uno’s hotel conversion model in the February issue of the Franchise Times.