E-commerce Ideas: Customized Frozen Pizza

The U.S. frozen pizza market size was valued at USD 6.62 billion in 2022 and is expected to grow at a CAGR of 6.9% from 2023 to 2030.

Mass Customization is a significant trend in the food industry attributable to busy lifestyles, convenience-oriented consumption patterns, and the increasing popularity of frozen food among consumers. Differentiating through an automated, customisable,  locally sourced frozen pizza production model can provide an ecommerce USP.

By offering high quality, frozen pizzas with customizable toppings, crust types and flavours at a minimum qualifying order-value it is possible to profitably attract Pizza lovers seeking premium, personalized, locally sourced products that minimise waste and energy.

Adopting a localised automated frozen pizza production model can offer several commercial advantages:

1.  There is a growing demand for unique personal preferences in high-quality frozen pizzas that promote sustainability.
2.  Flexible, short-run orders meet customer needs more efficiently.
3.  Cost can be controlled efficiently with flexible, higher volume production volumes [e.g. higher volume orders than fresh delivered Pizza].
4.  Scope for marketing efficiency: targeting higher average order values can meet paid ad cost hurdles without a substantial organic traffic base:

Example Key Performance Indicators:

• • • • $200 average order value ($20 per Pizza)
      • $4.3 CPC
      • 6% Conversion

5.  Automated production meets strict quality control standards for ingredients, production and delivery to ensure customer trust in the brand.
6.  Locally sourced ingredients minimizes food waste for optimal energy consumption and sustainability
7.  Ecommerce for convenience, with potential for omni-channel supermarket/ retail distribution (e.g. self-order via multi-vendor Kiosks)

There are a number of US based competitors in the frozen Pizza segment.

Product research to identify best selling bases and ingredient combinations is necessary. Market participants include:

Table 87
Kitchen 17
Digiorno
Schwans
Sam’s Club 

Typical Investment for USA Production & Fullfillment

• • Production capacity: Up to 30 pizzas per hour, with unique toppings
  • Cost of Automated Pizza Machinery: estimated around $25K-$35K per year
  • Freezing Unit: estimated cost $5,000 to $20,000
  • Software: Food safety management system (FSMS) that can be integrated with ecommerce stores, applications, and native apps.
  • Floorspace requirements: Around 800 – 1,000 square feet. $10K per year

Ideal Geographic Locations in the USA

Central locations in the US with good access to transportation networks are ideal:

1. 1. Indianapolis, Indiana: Indianapolis is a central location with good access to transportation networks. It is home to the Indianapolis International Airport, which is a major hub for FedEx and UPS. The city is also connected to major interstate highways, including I-70, I-65, and I-90.
   2. Columbus, Ohio: Columbus is another central location with good access to transportation networks. It is home to the Port of Columbus, which is a major shipping hub. The city is also connected to major interstate highways, including I-70, I-71, and I-75.
   3. Dallas, Texas: Dallas is a major transportation hub with good access to both air and ground transportation. It is home to Dallas/Fort Worth International Airport, which is the third busiest airport in the United States. The city is also connected to major interstate highways, including I-35, I-45, and I-20.

Overall, setting up a short-run frozen pizza operation in the USA can be a complex and expensive process. However, the potential rewards could be significant for entrepreneurs looking for new business opportunities that meet ESG objectives.