It will probably not come as a surprise to many that Blaze Pizza’s founders are talking about a possible initial public offering – at least, within two or three years.
Of course, a lot could happen over the months ahead to change that thinking. But, for now, fast-casual pizza is arguably one of the hottest niches in limited service, and Blaze is pushing to the head of the pack in terms of unit count, hoping to end the year with 112 restaurants – though competitor Pieology is not far behind, and plans to hit 180 units open this year.
Certainly showing no lack of chutzpah, Blaze, which was founded in 2012 by Wetzel’s Pretzels co-founder Rick Wetzel and his wife Elise Wetzel, is predicting that it will be the fifth largest pizza chain in the U.S. within five or six years, behind Pizza Hut, Domino’s, Little Caesar’s and Papa John’s.
Blaze has the potential of reaching 2,000 units domestically with another 1,000 possible in international markets, the company said.
Perhaps because an IPO may be on the horizon, Blaze reported financial results for fiscal 2014 and offered its outlook for the year ahead, even though it’s a private company and mostly franchised.
The Pasadena, Calif.-based chain finished fiscal 2014 with 50 units open, including 47 franchised and three company-owned, and expanded its footprint to 15 states.
The average unit volume for the 10 restaurants open a full year as of January was $1.55 million – which Blaze notes is well above competitors in the pizza category.
Blaze’s AUVs are also strong compared with fast-casual competitors outside the space.
Including sales reported by franchisees, the chain ended the year with systemwide sales of $33 million, compared with $6 million in fiscal 2013, when the chain had only 10 units.
Blaze said same-store sales for fiscal 2014 increased nearly 27 percent over the prior year.
This year, Blaze expects the chain to add another 62 restaurants, including two more company owned units, reaching 28 states, and into Canada as the first international market.
If AUVs stay at the $1.55 million mark and the chain reaches the 112-unit goal, Blaze estimates systemwide sales of $173 million for fiscal 2015.
Blaze had 36 franchise partners at the end of 2014, who plan to open a total of 343 restaurants. This year another four to six will be added, the company said, with the pipeline of restaurants growing to 500 over the next few years.
“The global trend behind the booming fast-casual restaurant segment – better quality, customization and premium environment – are also driving Blaze Pizza’s popularity and rapid expansion,” said Jim Mizes, the chain’s president and chief operating officer, in a statement. “Our momentum is fueled by our ambitious goal of bringing Blaze Pizza to every community so that everyone can connect, create and enjoy fast-fire’d artisanal pizza in an experience that’s fundamentally better than traditional fast food.”
If Blaze were a public company, they would probably include in their disclosures that the fast-casual pizza space is increasingly crowded, with serious contenders like MOD Pizza, PizzaRev, Project Pie, Your Pie, Uncle Maddio’s and more. New players continue to get into the game, like the upcoming MidiCi Neapolitan Pizza by the CEO of Menchie’s, another experienced franchise builder.
Blaze contends the fast-casual pizza space, though a very small part of the $38.5 billion pizza industry across the U.S. now, has much white space ahead. Freshly made custom pizzas could potentially reach more than 7,300 locations domestically across all brands, the company said.
Blaze is among the concepts often called the “Chipotle of pizza,” because of the build-your-own meal format. Of course, now Chipotle Mexican Grill is growing its own version of the concept with Pizzeria Locale.
Forget Chipotle, with its measly 1,800 units, Wetzel told Bloomberg. Now Blaze is aiming to become the “Starbucks of pizza,” with more than 12,000 domestic units.