🔗 Share this article

Once, Pizza Hut was the favorite for parents and children to feast on its all-you-can-eat buffet, unlimited salad bar, and make-your-own dessert.

But not as many customers are visiting the restaurant these days, and it is reducing 50% of its British locations after being acquired following financial trouble for the second occasion this year.

It was common to visit Pizza Hut when I was a child,” explains one London shopper. “It was a regular outing, you'd go on a Sunday – make a day of it.” However, at present, as a young adult, she states “it's fallen out of favor.”

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her twenties, certain features Pizza Hut has been famous for since it started in the UK in the mid-20th century are now outdated.

“The manner in which they do their buffet and their salad station, it feels like they are cutting corners and have lower standards... They provide so much food and you're like ‘How can they?’”

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

The company, similar to other firms, has also experienced its operating costs go up. In April this year, labor expenses increased due to rises in minimum wages and an higher rate of employer taxes.

Chris, 36, and Joanne, 29 say they would often visit at Pizza Hut for a date “every now and then”, but now they order in a rival chain and think Pizza Hut is “too expensive”.

Depending on your order, Pizza Hut and Domino's prices are comparable, notes a food expert.

Even though Pizza Hut has pickup and delivery through delivery platforms, it is losing out to major competitors which solely cater to this market.

“Another pizza company has taken over the delivery market thanks to aggressive marketing and frequent offers that make consumers feel like they're finding a good deal, when in reality the standard rates are on the higher side,” explains the analyst.

But for the couple it is worth it to get their special meal sent directly.

“We definitely eat at home now instead of we eat out,” explains Joanne, echoing latest data that show a decrease in people frequenting quick-service eateries.

In the warmer season, casual and fast-food restaurants saw a 6% drop in customers compared to the year before.

There is also a further alternative to restaurant and takeaway pizzas: the frozen or fresh pizza.

Will Hawkley, head of leisure and hospitality at a leading firm, notes that not only have grocery stores been offering good-standard oven-ready pizzas for quite a while – some are even selling home-pizza ovens.

“Evolving preferences are also having an impact in the popularity of casual eateries,” says the expert.

The rising popularity of high protein diets has driven sales at poultry outlets, while reducing sales of carb-heavy pizza, he continues.

Because people go out to eat more rarely, they may prefer a more premium experience, and Pizza Hut's American-diner style with booth seating and red and white checked plastic table cloths can feel more old-fashioned than premium.

The “explosion of high-quality pizzerias” over the last 10 to 15 years, including new entrants, has “fundamentally changed the consumer view of what excellent pie is,” notes the food expert.

“A light, fresh, easy-to-digest product with a select ingredients, not the excessively rich, thick and crowded pizzas of the past. This, in my view, is what's caused Pizza Hut's decline,” she says.

“Who would choose to spend £17.99 on a small, substandard, disappointing pizza from a large brand when you can get a gorgeous, skillfully prepared traditional pie for under a tenner at one of the many traditional pizzerias around the country?

“The decision is simple.”

Dan Puddle, who operates Smokey Deez based in a county in England comments: “People haven’t fallen out of love with pizza – they just want better pizza for their money.”

Dan says his mobile setup can offer high-quality pie at reasonable rates, and that Pizza Hut faced challenges because it could not keep up with new customer habits.

From the perspective of an independent chain in a city in southwest England, owner Jack Lander says the pizza market is diversifying but Pizza Hut has not provided anything innovative.

“There are now by-the-slice options, artisanal styles, New Haven-style, sourdough, Neapolitan, Detroit – it's a heavenly minefield for a pie fan to discover.”

He says Pizza Hut “should transform” as the youth don't have any fond memories or loyalty to the company.

Over time, Pizza Hut's market has been sliced up and distributed to its trendier, more nimble competitors. To maintain its expensive staffing and restaurants, it would have to charge more – which industry analysts say is tough at a time when personal spending are tightening.

The managing director of Pizza Hut's global operations said the acquisition aimed “to ensure our customer service and retain staff where possible”.

He said its immediate priority was to maintain service at the surviving locations and off-premise points and to support colleagues through the restructure.

However with significant funds going into operating its locations, it may be unable to allocate significant resources in its off-premise division because the sector is “complicated and using existing delivery apps comes at a cost”, commentators say.

But, he adds, reducing expenses by exiting competitive urban areas could be a smart move to adapt.