How much money to invest in to start a good pizzeria?

[hassansk]

Hi, guys I have decided on setting up a good pizzeria in North Nazimabad (food street), Karachi. My pizzeria will be the take-away, dine-in and delivery type. I have done a lot research but I never get the exact amount of money required to invest. Recently, I made a good list of all equipment required and the amount required to buy all of these equipment is 6 lakhs. I can fund as much as 25 lakh, but I am not sure if they will be enough. I will be renting a 3 marla + place for my restaurant. Does anyone here has experience in the field of restaurants? Can someone tell me if I can start a good pizzeria with just 25 lakh?

[Xulfiqar]

600,000 to buy a kneading unit, pizza oven, large capacity gas plumbing, exhaust systems, commercial refrigerators??? - wow.. honestly it will be more than 600K.

you will also need to get a large capacity gas installation - pizza ovens take a lot of natural gas to run - your average residential/small scale regulator wont flow enough - unless you are baking each pizza for 30 or 40 minutes.

how would I know this - I had a freind who started a pizzeria in Karachi - and even on small scale it was more than 600K at that time. (long ago).

[cooldevil]

open a tandoor style kiln for pizza baking...start from home delivery first. make a small setup initially to see the response

[ali15144]

Search wood oven pizza on net. Try that and capture the market with wood oven pizza.

[Xulfiqar]

Search wood oven pizza on net. Try that and capture the market with wood oven pizza.

sounds very poetic, but people in Pakistan dont know what a real pizza is, they only have one benchmark which is pizza hut and to be quite honest pizza hut makes quite bad pizzas anywhere in the world.

so if you get a quaint shop offering original and true italian style wood fired pizza oven product in Karachi - it wont sell because it lacks panache and style - its just a bhatti/bhaard wala pizza - pizza hut wala nahi hai bhai - bekaar hai.

Your idea sells like hot cake in other places though.

[hassansk]

600,000 to buy a kneading unit, pizza oven, large capacity gas plumbing, exhaust systems, commercial refrigerators??? - wow.. honestly it will be more than 600K.

you will also need to get a large capacity gas installation - pizza ovens take a lot of natural gas to run - your average residential/small scale regulator wont flow enough - unless you are baking each pizza for 30 or 40 minutes.

how would I know this - I had a freind who started a pizzeria in Karachi - and even on small scale it was more than 600K at that time. (long ago).

Okay, I might have underestimated the prices of the equipment. Hey, can you name the pizzeria your friend is running.

[butwhy]

600,000 to buy a kneading unit, pizza oven, large capacity gas plumbing, exhaust systems, commercial refrigerators??? - wow.. honestly it will be more than 600K.

you will also need to get a large capacity gas installation - pizza ovens take a lot of natural gas to run - your average residential/small scale regulator wont flow enough - unless you are baking each pizza for 30 or 40 minutes.

how would I know this - I had a freind who started a pizzeria in Karachi - and even on small scale it was more than 600K at that time. (long ago).

That was baaaaaaack then. Now you don't get gas in the first place. You use "hybrid" type ovens that run on gas and electricity and you keep big gas cylinders for the gas.

Also, you are over estimating the equipment costs. You can get an oven for ~100k. Mixing equipment etc for 50k max in total. Piping/exhaust etc ~20k max. Fittings/furniture for a very small place ~150k. Total will be less than 600k.

And your friend may have overpaid. Cannot rule that out.

[Xulfiqar]

That was baaaaaaack then. Now you don't get gas in the first place. You use "hybrid" type ovens that run on gas and electricity and you keep big gas cylinders for the gas.

Also, you are over estimating the equipment costs. You can get an oven for ~100k. Mixing equipment etc for 50k max in total. Piping/exhaust etc ~20k max. Fittings/furniture for a very small place ~150k. Total will be less than 600k.

And your friend may have overpaid. Cannot rule that out.

pizza ovens always are air assisted, electricity is not used as fuel though, When a gas cooker/oven for home use costs close to 80K (for an acceptable one) - how are you calculating a commercial oven can be had for 100K?

same with a kneading unit, we are talking about a unit that can knead and roll 40 kg dough multiple times a day - not a residential counter top cake mixer that gets used once a month.

How are commercial refrigerators costing less than residential ones?

have a look at this site - Iqbal Engineering Co.
they supply such equipment

[butwhy]

pizza ovens always are air assisted, electricity is not used as fuel though, When a gas cooker/oven for home use costs close to 80K (for an acceptable one) - how are you calculating a commercial oven can be had for 100K?

same with a kneading unit, we are talking about a unit that can knead and roll 40 kg dough multiple times a day - not a residential counter top cake mixer that gets used once a month.

How are commercial refrigerators costing less than residential ones?

have a look at this site - Iqbal Engineering Co.
they supply such equipment

No one uses those special pizza ovens, they're not practical in this market. I know the price because I simply asked a local pizza outlet guy while my pizza was cooking/baking(?) in the back. It had a capacity for ~4 14 inch pizzas at a time, maybe more. To my knowledge, most outlets don't use their own dough, they just get the crust from a supplier in bulk. But even if you want to make your own dough, small industrial mixers are not that expensive. And no one has any specialized industrial refrigerators, people use the regular deep freezer, and they are relatively cheap.

Also, household ovens cost like ~30k for a basic fully functional 4-5 stove plus oven. There is no such thing as "acceptable", for a business you use what ever is most cost effective, not design/colors etc. That's how/why industrial machinery tends to be much much cheaper per unit capacity than household appliances, they focus on function not form.

And at small scale, you don't need 40kg dough multiple times a day. A small outlet (note in OP, he said 3 marla which is 26ft each direction, not much dining in will happen in that area) would easily break even with just 10kg of dough per day. 1 kg of dough makes like ~10-15 6-inch pizzas(fastest selling product initially), probably more. You get maybe rs200 for each after sales tax and that's ~30k/day sales, which would probably make the outlet profitable. And offcourse, pizza is not the only thing, you have important side orders as well like french fries and drinks and other stuff.

[Xulfiqar]

No one uses those special pizza ovens, they're not practical in this market. I know the price because I simply asked a local pizza outlet guy while my pizza was cooking/baking(?) in the back. It had a capacity for ~4 14 inch pizzas at a time, maybe more. To my knowledge, most outlets don't use their own dough, they just get the crust from a supplier in bulk. But even if you want to make your own dough, small industrial mixers are not that expensive. And no one has any specialized industrial refrigerators, people use the regular deep freezer, and they are relatively cheap.

Also, household ovens cost like ~30k for a basic fully functional 4-5 stove plus oven. There is no such thing as "acceptable", for a business you use what ever is most cost effective, not design/colors etc. That's how/why industrial machinery tends to be much much cheaper per unit capacity than household appliances, they focus on function not form.

And at small scale, you don't need 40kg dough multiple times a day. A small outlet (note in OP, he said 3 marla which is 26ft each direction, not much dining in will happen in that area) would easily break even with just 10kg of dough per day. 1 kg of dough makes like ~10-15 6-inch pizzas(fastest selling product initially), probably more. You get maybe rs200 for each after sales tax and that's ~30k/day sales, which would probably make the outlet profitable. And offcourse, pizza is not the main thing, you have important side orders as well like french fries and drinks and other stuff.

how and where are industrial capacity appliances cheaper than residential? lol, fries, chips and drinks are ready packed, you need a deep fryer for the fries though to cook them quick and even, seen those? or are you going to tout - karhai lagao mithai walay ki - sastee hotee hai aur fries tayyar hojatay hain. - btw these items dont yield any good profit, they are add ons.

running a business with a goal to succeed and just winging it for timepass are two different avenues.

ready pizza dough is the most completely useless concept you will come across, you need to control and nurture the yeast so that you can control the taste of the pizza, pizzerias do a lot to maintain this - and it costs money (unlike pizza hut which just bulk packs rubbish and ships it to stores)

coming to ovens - a 30K home oven is comparable to a pizza oven in what sense? - they dont even put out half the heat of a pizza cooker even at maximum capacity.

so you are basically saying that - get a pile of bricks and light a fire on a residential low pressure gas setup to bake your cheap excuse of a pizza, get some old junk deep freezers from the market and use that for storage.. buy everything readymade, slap on and sell pizza.

Does such business have a foreseeable future or is it a 1 year gig for a young person who saw too many cooking shows?

[butwhy]

how and where are industrial capacity appliances cheaper than residential? lol, fries, chips and drinks are ready packed, you need a deep fryer for the fries though to cook them quick and even, seen those? or are you going to tout - karhai lagao mithai walay ki - sastee hotee hai aur fries tayyar hojatay hain. - btw these items dont yield any good profit, they are add ons.

running a business with a goal to succeed and just winging it for timepass are two different avenues.

ready pizza dough is the most completely useless concept you will come across, you need to control and nurture the yeast so that you can control the taste of the pizza, pizzerias do a lot to maintain this - and it costs money (unlike pizza hut which just bulk packs rubbish and ships it to stores)

coming to ovens - a 30K home oven is comparable to a pizza oven in what sense? - they dont even put out half the heat of a pizza cooker even at maximum capacity.

so you are basically saying that - get a pile of bricks and light a fire on a residential low pressure gas setup to bake your cheap excuse of a pizza, get some old junk deep freezers from the market and use that for storage.. buy everything readymade, slap on and sell pizza.

Does such business have a foreseeable future or is it a 1 year gig for a young person who saw too many cooking shows?

I said per unit capacity.
I have used household deep fryers myself. Commercial grade ones cost like 30-40k. Asked from local pizza outlet guy.

These addons actually yield a pretty decent return, especially fries if you don't buy the ready packed ones, but instead cut your own fries. There's atleast a 60-70% gross margin on fries. Potatoes are like rs.10-30/kg for the past several years. Retail for fries translates to like rs.0.5/gram or so. Check OPTP, entire business built on just fries.

I'm talking about the kind of pizza outlets that are everywhere, and are tried and tested concepts in this market. This "me too" business has proven itself in Pakistan. And this is the equipment they use. Maybe it's heart breaking to you because you're a true pizza guy, but that style of pizza is not yet mainstream amongst lower/middle class yet. Here we eat the desi pizza.

I mentioned cost for a commercial oven. You CAN get a commercial oven (of a small capacity, remember 3 marla) for ~100k. Anything bigger, you don't have the space nor the need for in a small outlet.

Yes, that's what I'm saying, except better hygiene and you pass inspection without bribe too. And you can make decent money if you market it right.

Yes, that business has a foreseeable future, see pizzahut's business model.

[Xulfiqar]

I said per unit capacity.
I have used household deep fryers myself. Commercial grade ones cost like 30-40k. Asked from local pizza outlet guy.

These addons actually yield a pretty decent return, especially fries if you don't buy the ready packed ones, but instead cut your own fries. There's atleast a 60-70% gross margin on fries. Potatoes are like rs.10-30/kg for the past several years. Retail for fries translates to like rs.0.5/gram or so. Check OPTP, entire business built on just fries.

I'm talking about the kind of pizza outlets that are everywhere, and are tried and tested concepts in this market. This "me too" business has proven itself in Pakistan. And this is the equipment they use. Maybe it's heart breaking to you because you're a true pizza guy, but that style of pizza is not yet mainstream amongst lower/middle class yet. Here we eat the desi pizza.

I mentioned cost for a commercial oven. You CAN get a commercial oven (of a small capacity, remember 3 marla) for ~100k. Anything bigger, you don't have the space nor the need for in a small outlet.

Yes, that's what I'm saying, except better hygiene and you pass inspection without bribe too. And you can make decent money if you market it right.

Yes, that business has a foreseeable future, see pizzahut's business model.

asking a desi pizza shop owner for pricing/value/use of such equipment is as useful as asking desi A/C taknissan about superheat in your home A/C unit.

Maybe you follow the "chalti ka naam gaadi" type of business model - I dont, because I have seen it fail 100% of the time - and whatever small amount of money you gained from the gig is wasted down when you see it collapse.

Any business/trade is only profitable if you know it inside out and you have the proper tools for it. e.g. a barber can use cloth cutting scissors or hair dressing shears to cut your hair - only one tool gives proper result in a timely manner.

[eagle1234]

Better you do some research before embarking do a swot analysis try out pizzas from different vendors note the taste estimate how much it costs if you want yo succeed you need a unique product or pizza which is a signature of your shop

There is always a demand for food as people go hungry now about you cater for the poorest a 50 rupee pizza like selling a slice of pizza for 50 rupees just my thoughts

Sent from my XT1032 using Tapatalk

[hassansk]

Better you do some research before embarking do a swot analysis try out pizzas from different vendors note the taste estimate how much it costs if you want yo succeed you need a unique product or pizza which is a signature of your shop

There is always a demand for food as people go hungry now about you cater for the poorest a 50 rupee pizza like selling a slice of pizza for 50 rupees just my thoughts

Sent from my XT1032 using Tapatalk

According to my calculations, the ingredient for a 13 inch (with more than enough toppings) alone costs around 300 PKR. So it is impossible to sell a slice of a 13 inch pizza for 50 PKR without losing cash! A slice of 9 inch pizza might be possible to be sold for 50 PKR but won't bring in much revenue and will not suffice the appetite of a customer.

[eagle1234]

How many slices make a 13 inch pizza and multiply by 50 rupees I guess that will cover it

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[hassansk]

How many slices make a 13 inch pizza and multiply by 50 rupees I guess that will cover it

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13 inch pizza makes 8 slices. 8 multiplied by 50 gives 400. The ingredients alone cost around 300 PKR. Adding other costs to the end-product will make the total cost around 550 rupees. Now if I sell a single slice for 50 rupees, I will lose 150 rupees for every 13 inch pizza. So you see 50 rupees per slice can never cover the cost of making a pizza leave alone the profit!