Pizza Hut: From a secret lab comes a cheesy idea

Yahoo Finance

For around 16 months, Chef Wiley Bates III has done his work in a closely monitored, difficult-to-access test kitchen in Plano, Texas, one where research is conducted, where ideas are abandoned or advanced, and where product development is handled with care.

He's gone from culinary school to high-end restaurants and hotels to this place, where he was found after a nationwide search that eliminated his competitors and left him alone, as the executive chef of Pizza Hut.

It is near this kitchen, located within an attractive building in a suburban office park, that he and a set of his colleagues are seated around the newest product from the pizza seller, the Crazy Cheesy Crust pizza.

The name is a fair one, though perhaps only by seeing it in person can one truly appreciate it. This particular item relies on the hand-tossed crust, but it comes with an immediately noticeable difference -- rather than the slices ending in that familiar arc of baked dough, each piece of the Crazy Cheesy Crust has appended to it two edible pockets filled with melted cheese.

"You notice how the dough actually nestles around," Chef Bates says. "The hand-tossed [crust] lends itself to absorbing some of those wonderful flavors, while again maintaining the integrity of the cheese."

His description of the pizza's characteristics and how it came to exist can perhaps be summed up by one short statement he adds: "Consumers always want more cheese."

Almost there

The Crazy Cheesy Crust pizza goes on sale Wednesday in all stores across the U.S., carrying a price of $12.99 for a one-topping version. According to the 2011 annual report for Yum! Brands (YUM), the owner of Pizza Hut, Taco Bell and KFC, the pizza chain had some 7,600 stores in the nation that year. Another 764 were in China, and 5,383 more were located in other countries. The vast majority of these are owned by franchisees, whose sales made up about $5.1 billion of Pizza Hut's $5.5 billion in revenue for the year.

Yum, citing data from NPD Group/CREST, says Pizza Hut accounts for about 15% of the American pizza restaurant segment. That would be in line with an article from PMQ Pizza Magazine, which published findings totaling the size of the domestic pizza market at $36.8 billion. Other large players include Domino's (DPZ) and Papa John's (PZZA), though independent mom-and-pop stores taken as a whole represent a huge component of the pizza universe.

As for the the Crazy Cheesy Crust itself, the pizza will have 16 U-shaped pockets housing a five-cheese mix of Asiago, Romano, Fontina, Provolone and mozzarella. Pizza Hut customers "love cheese, and we want to give them not just cheese, but we want to give them the highest quality we can and the most flavor we can," says Dominique Vitry, director of menu innovation.

Remember, we're not discussing steamed broccoli here. It's pizza. Asked whether the melted-cheese cups should be eaten before or after the slice, it is explained that either, or both, are allowed.

"It's kind of a dual experience," says Sarah Beddoe, senior manager of brand marketing. "You get a little bit of your [appetizer], or you get to enjoy it all, or that's your last bite. It's a nice way to end your slice of pizza."

Higher learning

As would be expected, the knowledge of tomato, cheese and dough pies is deep here. At headquarters, you will learn that pan pizzas are the most popular crust type for Pizza Hut, that the best-selling toppings are pepperoni, sausage and mushrooms, and that franchisees have some latitude with ingredients that might be popular in a particular market. The restaurant, now in almost 100 countries, got its start in 1958 in Wichita, Kan.

In the corporate cafeteria, Pizza Hut employees can eat the company's products. This isn't mandated, but it's one of the choices, along with an array of other items, including a salad bar.

What is required, however, is attendance at Pizza Hut Academy. All employees, regardless of their job function, must participate. Located in the building that Pizza Hut shares with Yum! Brands International in Plano, the academy is made to look like a restaurant, with booths, signs and decorations.

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Pizza Hut Academy: Credit Pizza Hut

Here, every worker learns every task performed in the stores, from making the pizzas and wings to cleaning to taking phone orders. Presumably, Crazy Cheesy Crust will be a future course.

Trial and error

For the new pizza, a variety of crusts and cheese blends were considered before settling on the final outcome. "It's always for me -- and when I challenge the chefs that help me -- staying grounded in consumer insights, staying grounded on what they want," Chef Bates says.

As the first to hold the executive chef position at Pizza Hut, Chef Bates came here by way of a far-flung search, though as fate would have it, he was already in the Dallas-Fort Worth area when he got the job.

"Coincidentally, he just happened to be here," says Sharon Webster Tolin, senior director of menu innovation. "But I've got to tell you, we looked nationally. When Chef Wiley came in, we felt like, immediately, this is the guy."

He seems glad to be doing it so far.

"Fine dining or otherwise, the application is still the same," he says. "I am still trying to make that customer excited and happy."

It's hard to go wrong with melted cheese.

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