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Dairy farms are a critical piece of the pizza pie, and American farmers are setting an example of how the two industries can work together.
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One day I checked my e-mail and found an e-zine from American Pizza
Marketplace with the headline: Dairy industry works to boost pizza
sales. It seems that the U.S., dairy industry understands that the
average American gets more dairy from cheese than from the bottle. In a
combined effort to increase consumption, officials at Dairy Management
Inc. (DMI) have partnered with U.S. Domino’s stores to roll out a pizza
using 40 per cent more of the melted gold.
“Pizza sales directly affect overall cheese sales, as about 25 per cent
of total cheese is used on pizza and that represents more than 25
billion pounds of annual milk production. DMI’s partnership with
Domino’s and others in the pizza category can help lead to increased
cheese sales on behalf of U.S., dairy producers,” says industry expert
Joe Bavido.
American pizza makers pay approximately half of what Canadians pay for
a pound of cheese. Even with that cost advantage, the U.S., dairy
industry is still working with pizzerias to help grow consumption. The
water must be different here. Last year a few cheese producers worked
with fresh pizza makers to create a cheese with less full-fat milk and
more milk solids, essentially creating more from fewer raw ingredients
in order to provide a lower cost product. Instead of rewarding their
ingenuity, the government slapped the dairy cheese producers with a new
federal regulation limiting their ability to create lower cost cheeses
intended for fresh pizza makers.
We do not get the discounted price that our neighbours get and we
don’t even get the same price as frozen pizza producers. However, we do
get to run higher overheads and collect and remit government taxes
while we pay more for our dairy every year. We get to do all this while
trying to compete with all the frozen pizzas in the grocery store
freezers.
It’s no wonder that fresh pizza makers are aggressively looking at ways to cut high priced dairy from their
menu by using and even sourcing imitation cheeses made from
alternatives like soy and canola. We have been struggling for years to
maintain our profit margins while providing customers with a quality
product for the budget-minded. Frozen pizza prices still beat even the
cheapest fresh pizza. On top of that, the consumer doesn’t pay any
taxes when they buy frozen pizzas because they’re considered groceries.
Adding insult to injury, we are affronted by frozen pizza ad campaigns
claiming superiority to all fresh pizzas.
Several months ago we began an informal survey at Diana’s Gourmet
Pizzeria that posed the question: Does the average Canadian consumer
know the truth behind those big savings on frozen pizzas in the grocery
store or do they assume that fresh pizza makers must be gouging them?
You can probably answer the question without knowing the results of our
impromptu survey. Like it or not, fresh pizza makers have been forced
to compete with the frozen pizza market, if not on quality, most
definitely on price and we are competing with a severe disadvantage.
The cards have been stacked in the frozen pizza makers’ favour.
Unfortunately, the Canadian Dairy Farmers and the Canadian Dairy
Commission don’t seem to realize what their U.S., counterparts know for
a fact: fresh pizza is the key to increasing dairy consumption in every
household across North America.
To the best of my knowledge, the two tiered pricing structure doesn’t
exist in any other dairy market in the world. When I talk with friends
from around the globe they are completely flabbergasted. My good
friends Bruno DiFabio and Tony Gemignani from the World Pizza Champions
Team pay significantly less. DiFabio pays $1.74 U.S., per pound and
Gemignani pays $2.38 U.S., per pound for high quality, full-fat brick
mozzarella compared to our $4.29 per pound. How much more money would
you have left over if you could buy good quality mozzarella at those
prices?
What should we do about this unfairness? Should we all get into the
frozen pizza business? Should we continue to use less dairy and find
palatable substitutions? I’d really like to hear from you about how
you’ve changed your operation or menu in light of the never ending high
priced dairy. Will you raise your prices? If you knew of a palatable
substitution that cost 30 per cent less than your dairy cheese, would
you switch? One thing for certain is that we need to educate the
Canadian consumer about two tiered pricing for dairy cheese. There will
always be a difference in the taste of a frozen pizza versus a fresh
pizza, and many frozen pizza makers use ingredients that few can
pronounce because of the need for shelf stability and to mimic
characteristics of a fresh pizza. Fresh pizza makers will never need
yellow dye 64, or msg, or encapsulated fat flakes in our recipes and
this is a good point, health conscious Canadians need to consider.
Diana Coutu is a two-time Canadian Pizza Magazine chef of the year
champion, internationally recognized gourmet pizzaiolo and co-owner of
Diana’s Gourmet Pizzeria in Winnipeg, Man. In addition to creating
award-winning recipes, Diana is also a consultant to other independent
pizzeria owner/operators in menu development, creating systems to run a
pizzeria on autopilot, along with marketing and positioning to help
operators grow their business effectively and strategically. She is
available for consulting on a limited basis, for more information
contact her at
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