Little Caesars Pizza, the U.S. pizza chain, is planning to re-enter the Peruvian market come the first quarter of 2018. It will compete with other pizza chains using its global pricing strategy (50% lower), drive-through service and “Hot-N-Ready” service.
The franchise had formerly operated in Peru, though closed its doors in the first half of 2011 when it closed the premises in the United States that had remotely administered the Peruvian branches.
The reinstatement of Little Caesars Pizza in Peru will be handled by Nexo Franchise Group, a franchise managing group from Mexico. According to Fernando Lópex de Castilla, managing partner of the Nexo Franchise Group, his company will help to implement the infrastructure of the expansion of Little Caesars into the Peruvian market.
López de Castilla indicated that Little Caesars’ flagship location will likely be a door-to-door and drive-through service in Miraflores, San Borja or San Miguel, though in the next five years the brand plans to open 20 stores. He added that the installation of each premise will require between four and six months preparation, depending on the layout and location.
In order to compete with the already established pizza chains, Little Caesars will seek to break into the Peruvian market using its global strategy that has been based on its price (50% lower), drive-through service and “Hot-N-Ready” service. They will also look to enter small and scalable formats, including locations in food courts, in order to increase sales volume.
In Peru, the business category of pizza moves approximately US$500 million annually, making it the third most important category after pollo a la brasa (grilled chicken) and chifa. Across the country there are about 9,000 pizzerias, 250 of which belong to the eight major brands that compete in the Peruvian market. Moreover, it is estimated that Peruvians eat pizza five times a month, with their preferred varieties being pepperoni and Hawaiian.