Little Caesars' Pizza Empire Will Gain 10 New Stores In New York City

At this time, it's too soon to know how Little Caesars' decision to raise the price of its Hot-N-Ready pizza to $5.55 affected 2022 sales. However, a company announcement issued Friday, February 24, 2023, refers to Little Caesars as an "exceptionally high growth company," intimating that the world's number three pizza chain is on something of a roll. Of course, that, itself, is not surprising considering the company clocked $4.23 billion in sales in 2021, compared with $3.95 billion in 2020, per Statista.

The question, however, is whether Little Caesars is planning on coming for Domino's and Pizza Hut, the number one and two largest U.S. pizza chains. As of March 28, 2022, Little Caesar's had 4,181 units, around 10% or so of which are company-owned, according to the chain's 2022 Franchise Disclosure Document, the most recent such document available. It's still well behind its two largest competitors, who are more or less, neck and neck with one another. But perhaps it's just a matter of Little Caesars needing some time in which to exercise the current growth plan that it has been proudly touting for some time now.

To wit, in June 2022, Restaurant Dive reported Little Caesar's could end the year with two times as many franchise agreements based on its trajectory at the time. Although it's also too soon to know how that panned out, just this week, the Little Caesars pizza empire announced some very big plans to grow its New York City market.

Little Caesar's is growing its New York City footprint

Our recent ranking of 19 popular pizza chains suggests Little Caesars is beloved primarily for its value. Convenience, however, plays a burgeoning role, according to Chief Development Officer, Jeremy Vitaro, who told Restaurant Dive that amping up its delivery model has supported Little Caesar's growth plans in densely populated areas where delivery is highly prized. Not coincidentally, New York City is where Little Caesars is focusing its most immediate growth efforts.

On February 24, 2023, Little Caesars announced that it plans to open literally hundreds of new locations in New York City and the greater New York area in the next several years. And it's all starting with a brand-spanking newly inked 10-store franchising agreement with a pair of seasoned quick service restaurant franchisees, Suhel Ahmed and Saurabh Desai. Although this would appear to be the pair's first foray into the Little Caesars biz, their existing portfolio includes numerous Dunkin' and Dave's Hot Chicken franchises, many of which are located in New York City. Moreover, both are native New Yorkers.

As Ahmed pointed out, he and his partner understand what works in New York City. Noting the pair's extensive experience as multi-unit franchisees in New York City, Vitaro said Little Caesars is excited to work with them to grow the chain's presence in the New York City market. The Big Apple's Little Caesar fans can expect the first of these new locations to open in 2023.

Why its new 10-store New York City deal is so significant for Little Caesars

Beyond what the company says in its February 24 announcement, this deal seems highly significant at this point for Little Caesar's. Looking at the net changes in its restaurant tally, Little Caesars lost a combined 81 locations between the beginning of 2019 and the end of 2021, according to the chain's 2022 Franchise Disclosure Document. And all of the negative growth was seen in franchised units (as opposed to company-owned). At the beginning of 2019, there were 3,700 franchised units. At the end of 2021, there were 3,601. Moreover, back in 2019, the company hemorrhaged a dozen locations throughout the U.S.

Fortunately for both Little Caesars and its up-and-coming New York City franchisees, Ahmed and Desai, the prospects may be far better for the chain's Big Apple locations. For starters, the NYC market managed to lose only a single location during 2021, the last year for which such information was available.

As of the end of 2021, there were 68 Little Caesars locations in New York State. Of these, 11 are in New York City, with eight in the Bronx, and three in Manhattan. If all goes according to plan, that number should be up to 12 by the end of 2023 and 21 by 2026.

While we're on the topic of the importance of food delivery in New York City, here's how delivery apps like Grubhub stand to gain if NYC relaxes Its delivery fee cap.