If it's been a while since you've set foot in a shopping mall food court, it's probably
been a long time since you've eaten at a Sbarro.
What happened to this once-ubiquitous pizza chain?
These are the reasons Sbarros are slowly vanishing nationwide.
The biggest problem Sbarro faces is the changing way in which Americans are doing their shopping.
"Changing consumer tastes are taking a toll on the food court at your local mall."
Sbarro's strategy was intrinsically tied to its shopping mall locations.
But with malls in serious decline across the country, suddenly Sbarro no longer has a captive
audience to sell to.
And when people do go to the mall, there are far more options than there used to be, with
healthy options, locally sourced food, and even craft beer.
Sbarro might be there, somewhere between the Sweetgreen and the Bareburger, but the competition
is a lot stronger than it used to be.
"Sbarro restaurant, or as some of you may know us, that place in the mall food court
that always has the shortest line."
In the 1990s, one of the things that gave Sbarro cachet was the exclusivity of its product.
If you wanted to get down on some greasy pizza, you had to find a pizza place.
"It's like right here is my favorite New York pizza joint, and I'm going to go get me a
New York slice!"
Not any more, though.
Pizza is now available seemingly everywhere, from the frozen food aisle in your grocery
store to the snack bar at your gas station.
And with pizza chains on every street corner, you can even have hot, fresh pizza delivered
to your doorstep simply by picking up your smartphone.
Plus, those other chains have a lot more options than Sbarro does.
Joints like Domino's and Pizza Hut allow patrons to try all sorts of inventive toppings, new
sauces, and offbeat crust choices.
Sbarro just hasn't kept up with the times.
And it's not just their food that's outdated, it's their entire business model.
Sbarro has always sold itself as being ready whenever you are, but that means their food
isn't made to order, it's made in advance, often well in advance.
They are basically trading convenience for quality, and according to restaurant consultant
Michael Whiteman, that just doesn't fly with consumers anymore.
"Sbarro has been stuck with an outdated business model.
Its biggest shortcoming is that it sells food that has been sitting out for a while, and
more people want food made to order."
To their credit, the chain is trying to catch up, as Sbarro has finally begun experimenting
with locations outside of malls that actually offer delivery.
But according to Sbarro chief marketing officer Annie Pritz, it's been a steep learning curve.
"It's a very challenging business.
We had never done delivery or carryout before.
And there's a lot of nuances.
You have to master online ordering.
You have to master customization.
You have to master new products.
And you have to make sure, ultimately, that you are not sacrificing the quality of your
product when you're making those deliveries that are 20 miles or 20 minutes from your
store."
The bottom line for Sbarro, though, is… well, the bottom line.
In 2011, Sbarro declared bankruptcy.
Then they declared bankruptcy again just three years later.
"Sbarro the pizza chain is also filing for chapter 11 for the second time in three years,
closing 155 of 400 company owned stores."
Comedians like Conan O'Brien also had a field day mocking the chain for serving fake Italian
food to "fake Italians."
"a'Sbarro's is going a'bankrupt?
Mama mia, what am I gonna do?
I need'a my meatball!"
Though they eventually emerged from the second bankruptcy in 2014 with a new business plan,
they still carried roughly $165 million in liabilities.
And even the smallest increase in costs can have major ramifications.
In 2014, the cost of mozzarella cheese suddenly spiked by 16 percent, with cheddar cheese
rising by about 25 percent overall.
Given the amount of cheese a pizza chain the size of Sbarro goes through, those types of
unexpected price hikes can be difficult to weather, especially for a chain in the process
of rebuilding itself from scratch.
After emerging from bankruptcy protection in 2014, Sbarro was determined to address
their issues.
Besides experimenting with freestanding restaurant locations, they also went through a branding
overhaul, and begin introducing artisanal ingredients and wood fired ovens.
So far, Sbarro's modernization efforts haven't really paid off.
The company's burgeoning social media presence has only racked up around 300 thousand followers
on Facebook, compared to over 30 million for Pizza Hut and over 20 million for Domino's.
We know what you're thinking: social media?
So what?
"What the f--- does that have to do with pizza?"
"I don't know."
But the lack of engagement online from consumers has also showed at the cash register: In 2016,
the chain still saw a 10.6 percent decline in sales over the previous year, and in 2017
it fell 5.5 percent.
Finally, the biggest issue facing Sbarro is the simple fact that people don't like their
food.
In 2014, a Consumer Reports survey of over 30 thousand customers ranked Sbarro as the
worst fast food chain in America.
No wonder the chain is disappearing.
"Sbarro's pizza.
Started from the bottom, and now still very much at the bottom."