57% of Israel's pizzerias are classified by Dun and Bradstreet Israel as high risk, i.e. in danger of closing. It says that about 1,000 pizzerias currently operate in Israel and that they have an aggregate annual turnover of NIS 400 million and employ 6,000-8,000 people.
Large pizza chains, including Pizza Domino Ltd., and the local franchises of Domino's Pizza and Pizza Hut, operate over 200 branches altogether, and 55% of total turnover. 57% of the Israel's pizzerias are in the center of the country, 31% are in the north, and only 12% are in the south.
There are also a number of independent pizzeria chains of 2-6 branches each, which account for 15% of annual turnover altogether. Local pizzerias account for the rest of the market.
Dun and Bradstreet Israel says, "It is actually the popularity of pizza in Israel that is jeopardizing the sector. The fact that opening a pizzeria does not involve a large capital layout renders the sector extremely competitive. Many businesses do not survive for long because of the intense competition."
It costs NIS 100,000-300,000 to open a pizzeria, 40% of which goes toward renovating the premises and the rest for equipment.
At the same time, Israel's frozen pizza market is growing, and reportedly accounts for a third of total pizza sales.
Published by Globes [online], Israel business news - www.globes-online.com - on October 7, 2009
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