🔗 Share this article

Once, the popular pizza chain was the go-to for groups and loved ones to feast on its unlimited dining experience, endless salad selection, and ice cream with toppings.

However fewer diners are frequenting the restaurant these days, and it is closing half of its UK restaurants after being rescued from insolvency for the second instance this calendar year.

It was common to visit Pizza Hut when I was a child,” explains a young adult. “It was like a family thing, you'd go on a Sunday – make a day of it.” However, at present, in her mid-twenties, she comments “it's no longer popular.”

For a diner in her twenties, certain features Pizza Hut has been known and loved for since it started in the UK in the mid-20th century are now outdated.

“The way they do their all-you-can-eat and their salad station, it seems as if they are cheapening on their quality and have lower standards... They provide so much food and you're like ‘How is that possible?’”

As grocery costs have increased significantly, Pizza Hut's all-you-can-eat model has become very expensive to maintain. The same goes for its outlets, which are being reduced from a large number to 64.

The chain, in common with competitors, has also seen its operating costs rise. In April this year, staffing costs jumped due to increases in the legal wage floor and an higher rate of employer taxes.

Chris, 36, and Joanne, 29 mention they used to go at Pizza Hut for a date “from time to time”, but now they order in a rival chain and think Pizza Hut is “not good value”.

Depending on your selection, Pizza Hut and Domino's costs are close, notes an industry analyst.

Although Pizza Hut does offer off-premise options through external services, it is falling behind to big rivals which solely cater to off-premise dining.

“The rival chain has succeeded in leading the off-premise pizza industry thanks to strong promotions and ongoing discounts that make shoppers feel like they're getting a bargain, when in reality the standard rates are relatively expensive,” says the analyst.

However for the couple it is acceptable to get their date night delivered to their door.

“We predominantly have meals at home now more than we eat out,” says one of the diners, reflecting current figures that show a drop in people frequenting casual and fast-food restaurants.

During the summer months, informal dining venues saw a 6% drop in diners compared to the previous year.

Moreover, one more competitor to pizza from eateries: the cook-at-home oven pizza.

Will Hawkley, head of leisure and hospitality at a major consultancy, explains that not only have retailers been offering high-quality oven-ready pizzas for years – some are even selling home-pizza ovens.

“Lifestyle changes are also playing a factor in the popularity of fast-food chains,” says Mr. Hawkley.

The increased interest of protein-rich eating plans has increased sales at chicken shops, while affecting sales of high-carbohydrate options, he notes.

Because people dine out not as often, they may prefer a more premium experience, and Pizza Hut's retro theme with booth seating and traditional décor can feel more old-fashioned than upmarket.

The growth of high-quality pizzerias” over the last 10 to 15 years, such as new entrants, has “dramatically shifted the general opinion of what quality pizza is,” says the industry commentator.

“A crisp, airy, digestible pizza with a few choice toppings, not the massively greasy, heavy and overloaded pizzas of the past. That, arguably, is what's caused Pizza Hut's struggles,” she states.

“Why would anyone spend a high price on a small, substandard, disappointing pizza from a large brand when you can get a stunning, expertly crafted traditional pie for a lower price at one of the many real Italian restaurants around the country?

“It's a no-brainer.”

A mobile pizza vendor, who owns a pizza van based in a county in England explains: “People haven’t stopped liking pizza – they just want improved value.”

The owner says his mobile setup can offer high-quality pie at affordable costs, and that Pizza Hut had difficulty because it could not keep up with changing preferences.

From the perspective of an independent chain in a city in southwest England, the founder says the pizza market is broadening but Pizza Hut has failed to offer anything innovative.

“You now have slice concepts, artisanal styles, New Haven-style, artisan base, Neapolitan, deep-dish – it's a heavenly minefield for a pie fan to discover.”

He says Pizza Hut “must rebrand” as the youth don't have any emotional connection or allegiance to the company.

Gradually, Pizza Hut's customer base has been divided and allocated to its fresher, faster alternatives. To sustain its costly operations, it would have to raise prices – which industry analysts say is tough at a time when household budgets are shrinking.

The managing director of Pizza Hut's international markets said the buyout aimed “to safeguard our dining experience and protect jobs where possible”.

The executive stated its immediate priority was to keep running at the open outlets and off-premise points and to support colleagues through the transition.

But with significant funds going into running its restaurants, it probably cannot to spend heavily in its off-premise division because the market is “difficult and partnering with existing third-party platforms comes at a price”, analysts say.

However, it's noted, reducing expenses by exiting crowded locations could be a smart move to evolve.