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TRANSCRIPT | The secret sauce of a pizza chain

Keith Heim:  So, I mean, we service everybody. You know, Domino's, Little Caesars, Hungry Howie's, Marco's, Papas – Papa Romano's, Papa John's. Uh, everybody, we do them all.

April Baer: This is Keith Heim. He's been running his company Big Guy Service and Repair for about 12 years. Keith's expertise is pretty critical to the pizzerias he services. He does repairs on perhaps the single most critical tool in any pizza shop. Laura, do you want to guess what that is?

Laura Weber-Davis: Is it the, uh, the dough mixer? The cash register!

April Baer:Good call. And points for creativity. But no, he fixes the ovens.

Laura Weber-Davis: Oh, of course, the oven!

Keith Heim: So I'm gonna go turn this on. You'll hear there's kind of, like, a bit of noise to it.

Laura Weber-Davis:So you're saying that he can't fix flavor? Sadly, no.

April Baer: But he has everything to do with how your pizza turns out.

Keith Heim: Well that's not good. The allen set screw in there is stripped.

April Baer: The conveyor oven may not be the sexiest tech in a modern commercial kitchen, but you can't have a big pizza business without an oven that can be standardized across hundreds, even thousands of pizza shops all over the world. In this case, the conveyor oven.

Laura Weber-Davis: Ah, yes. And one of our pizza kings is believed to have invented this kitchen marvel.

Keith Heim: As far as. . . No, I don't – I don't believe that he invented the conveyor oven.

April Baer: Wait, what? All right, we'll get to the bottom of that later. But the fact is that the conveyor oven is one of many innovations that helped Michigan's Pizza Kings deliver better, hotter, faster pizza to the people, and elevate their product to a global stage. From Michigan Radio, I'm April Baer.

Laura Weber-Davis:  And I'm Laura Weber Davis. This is Dough Dynasty.

April Baer: On this episode, early pizza industry innovations.

Laura Weber-Davis: We're going to talk about three major contributions from our Michigan "dough dynasties" that made the pizza industry what it is today. There were more than three, but these were some of the biggest ones. But to get there, we have to talk about their businesses as they were being built. So, let's go back to the 1960s, an era of postwar pizza proliferation. By 1965, both Domino's and Little Caesars have opened their doors and are expanding.

Denise Ilitch: Their first customer came in and ordered a chicken basket and dad said,"Oh, you're our first chicken customer, so this is complimentary!"

April Baer: Denise Ilitch, daughter of Little Caesars founders Mike and Marian Ilitch. The family still owns the company. Denise is talking about the early days of the very first shop in 1959, in Garden City.

Denise Ilitch: And then a second customer came in, they ordered a fish basket. And he did the same thing, and he said, "You're our first fish customer! It's for free!" And then a third customer came in. They ordered a pizza, and dad was about to say. … My mother was at the register. She always works the register, so she wasn't in the back. And so he had said, "Oh my god, you're my, you know, the first pizza customer! It's. … " And she cut them off and she said, "That'll be $2.65."

Laura Weber-Davis: Denise says this story shows the kind of partnership that her parents had from the beginning: Mike Ilitch was the idea guy, and Marian was the financial wizard.

April Baer: The Ilitches first to expand their business in Metro Detroit, and then in the city of Detroit proper. Focusing on densely populated residential areas of working families, they carve out a niche for themselves, offering fast takeout pizza and 15-minute service.

Laura Weber-Davis: Meanwhile, Domino's founder Tom Monaghan opens a few pizza shops in Washtenaw County. In his mind, it's the perfect place to focus on a different niche: delivery in a target-rich environment. University of Michigan and Eastern Michigan University are both in Washtenaw County, just a couple of miles apart.

Carol Hestosky: What becomes Domino's offers quick and easy delivery. That's a real boon for families as well as college students, because you could feed a hungry crowd for not a lot of money.

April Baer: Carol Helstosky is the author of “Pizza: A Global History.”

Carol Hestosky: They knew, right, students didn't have a lot of money and wanted quick, cheap food. And if you think about it, that goes back to the origins of pizza in Naples as being quick, cheap, filling food. You know, food for the poor, food for the workers.

Laura Weber-Davis: So he's got three Domino's storefronts offering speedy delivery. And then he puts three dots on his Domino's logo, and he's off to the races. It's a brewing contest of expanding pizza companies in a small geographic area. Which brings us to the first major innovation that really allows these small but growing businesses to take off: the pizza supply chain.

April Baer:  As each business continued to grow, the brand and the product had to stay consistent across locations. Every chain has strategies for doing this. Mike Ilitch's strategy was to take control of the supply chain.

Denise Ilitch: When it first started was with mushrooms. So the mushrooms came canned from China.

April Baer: That's how Denise remembers it.

Denise Ilitch: And Dad did not want that. But no one was doing fresh mushrooms, because that was a lot more expensive. And so what he decided to do as a young entrepreneur is start a mushroom farm. And it was on Telegraph Road in Southfield, but it was like an office building. But they started growing mushrooms because he wanted fresh mushrooms.

Laura Weber-Davis: And it was literally just called Little Caesars Mushroom Farm.

Denise Ilitch: And that was sort of the beginning. And then after that, he started to want to control more of the product on the pizza, and making sure that the sauce was done right, and the toppings were done right. And so we formed a supply company called Blue Line Foods.

April Baer: Blue Line Foodservice Distribution is still around, still in Michigan, based in Farmington, and still owned by Ilitch Holdings. They supply food and packaging to companies all around the world, Little Caesars being just one of them.

Denise Ilitch: What is proprietary about Little Caesars is the spice blend. And so my grandfather and my uncle, there is a spice room in the warehouse where all they do is blend spices, and my grandfather did that till the day he died.

Laura Weber-Davis: Meanwhile, over at Domino's, Tom Monaghan took that supply chain strategy just one step further.

Steve Green: What they did early on was they created a commissary system.

Jenny Fouracre: The supply chain centers are amazing.

Stuart deGeus: Domino's has central commissaries that make the dough and truck them, as you see on the highway.

Tom Monaghan: Our upstairs were our offices, and the downstairs in the basement were our commissary. Had about $130 to $140 thousand.

Laura Weber-Davis:  The central commissary. In the early days, this looked like a central location for Domino's that would do all of the food prep, and then send it out to a handful of stores.

April Baer: So commissary, like, as in military style?

Laura Weber-Davis: Yeah. Both he and Mike Ilitch spent some time in the armed services, but Monahan says he took the idea from actually another restaurateur. And this is totally an aside, but a nugget that Michiganders might appreciate. That restaurateur was Bill Knapp's.

April Baer: No, wait a minute. Bill Knapp's like the restaurant,Bill Knapp's, with the chocolate cakes and stuff.

Laura Weber-Davis: Yep, the very same. And for folks who haven't seen it, it's kind of like fancy Red Lobster or Olive Garden, except just, like, stick-to-your-gut American cooking. Here's Tom Monaghan himself talking about the commissary. This was part of a speech that he gave at a Rotary Club meeting back in 1979.

Tom Monaghan: We have three parts to our business. We have the pizza business, we have the franchise business, and we have – we have a commissary, which sold all the food to our franchises. And that's one of the secrets to our stores doing well, I believe.

April Baer:  Stop for a minute when you need to, okay?

Jenny Fouracre: All right.

April Baer: Jenny, hi!

Jenny Fouracre: Hi, thank you for coming to the World Resource Center! So we are in the lobby of the World Resource Center, and there is a class in the center of our building at our Domino's Pizza store. Every corporate employee.

Laura Weber-Davis: All right, so this is Jenny Fouracre, and she is the current senior director of communications at Domino's.

Jenny Fouracre: If I'm ordering pizza without my family, I will order a Pacific Veggie, and if I'm ordering with my kids, we order ham and bacon.

Laura Weber-Davis: We paid her a visit at headquarters in Ann Arbor. Jenny tours us around the office, which has some very sleek, modern furniture.

April Baer: This place is so, like futuristic. There's a bunch of artifacts, but it's also like. … That is the slickest, like, living room set I've ever seen.

Jenny Fouracre: Well, we've got a lot of history, but we're also, you know, we're a brand on the cutting edge. And so I think this space really reflects that.

Laura Weber-Davis: On the second floor, there's a huge glass wall that overlooks a kitchen – an actual functioning Domino's kitchen, just like you might see in a store. Franchisees from all over the country come here to train. On the wall behind us, there's a TV screen playing a promotional video.

Jenny Fouracre: That's our supply chain center, that video.

Laura Weber-Davis: In other words, the central commissary.

Jenny Fouracre: You go to the supply chain centers, and they're amazing. So how it works is the supply chain center driver comes into the store after the store has closed or before it opens, takes out all of the old inventory, refreshes with new inventory, locks up the store and leaves, so that when the manager comes in, they're stocked and ready to go.

Laura Weber-Davis: Oh, it's done for them?

Jenny Fouracre: It's done for them.

April Baer: For real?

Jenny Fouracre: Yeah, that's been since the founding. And the reason is – is so that managers can just focus on managing a store, and supply chain will worry about making sure they have food. Also, our supply chain centers manufacture fresh dough. So they bring in the fresh dough, they bring in the toppings, they bring in the boxes, anything you need. That's like, that's a picture. You just saw a video of someone doing that. They come off the truck and they supplied. . . They stock the store for the manager.

Laura Weber-Davis:  I just want to know how I can get this at my house. Please come and fill my fridge.

Dave Brandon: And it – it's not as easy as people might think. My name is Dave Brandon. I'm executive chairman of Domino's Pizza, and my favorite pizza is whatever is selling the most at the moment.

April Baer: Always the salesman. He also served as the company's CEO from 1999 to 2010.

Dave Brandon: The ability to manufacture that dough ball, keep it in our in our dough-making operations in our coolers for the right period of time, get it on a cold food truck that keeps it refrigerated, get it in a cooler in the store, and then use it during its most optimal window is not an easy thing to do, and we've systematized that.

April Baer: There are plenty of pizza chains that don't go this route. Maybe each franchisee is responsible for gathering their own inventory, or maybe they all get the ingredients delivered, but they make their dough fresh in store, like Little Caesars does.

April Baer: So why does Domino's go through all the trouble of developing a commissary?

Dave Brandon: Tom Monaghan was just obsessive about figuring out ways to create an operational format in the store that took out time and motion, and get that product out the door quickly so that it could be safely delivered. And at some point, Tom realized that he had something that could become very large. And as these concepts grow and spread geographically, and you get more franchisees in the mix, you can imagine a world where they read that mushrooms are on sale at Kroger, so they run down because they can save a few bucks buying their mushrooms from Kroger, or they find a cheaper cheese, or. … Pretty soon you start to lose what is truly the definition of a brand, and that is the promise of consistency. So I think the genesis of the whole supply chain was really a function of quality control and consistency

April Baer: We should clarify, Domino's was not the very first company ever to utilize a system like this. But assuming Domino's really has been using the system since its founding, it's likely that it was the first big pizza chain to use a commissary.

Dave Brandon: I don't know that we would take credit for being the first to think of that, but perhaps we're one of the first to really embrace it and continue it over a long period of time.

Laura Weber-Davis: After the break, we'll look at another innovation that changed the industry. One that Mike Ilitch is often credited for inventing. But we're not so sure. More in a bit.

April Baer:This is Dough Dynasty. I'm April Baer. 

Laura Weber-Davis:  And I'm Laura Weber-Davis. All right, so you're a pizza person. You've received your dough, and your sauce, and your cheese, your toppings, all perfectly sliced from the central commissary. What does one do with such ingredients?

April Baer: You bake them!

Laura Weber-Davis: Right! Which brings us to our second pizza innovation from these pizza kings: the oven.

April Baer: And not just any oven.

Keith Heim: It's forced air. It's not like your oven at home. Your oven at home doesn't. … I mean, they're very noisy, and there's openings on both sides, and the heat's just pouring out constantly.

Laura Weber-Davis: This is Keith Heim, and he is the oven repair master that we were shadowing at the top of the show.

Keith Heim: I love my pie deep dish style, more or less, like the Detroit style. Pepperoni, mushroom, bacon.

April Baer: Keith is living the dream. The guy literally hops around the state all day repairing pizza ovens, so he knows all the ins and outs and evolutions of this piece of technology. Obviously, pizza ovens far predate the rise of pizza chains, but there is a type of pizza oven that was designed specifically for the fast-paced operations of these businesses.

Keith Heim: So it's just like this big metal belt. It's like a conveyor belt.

April Baer: He's talking about the conveyor oven.

Keith Heim: It just goes one direction, and most pizzas are cooked between five minutes to 13 minutes. It depends on the style, how deep it is, blah, blah, blah. And then we won't even get in Chicago. That's a whole different ball game. You set them on there, and then it runs through and the bakes, it comes out the other side, pull it off with whatever device you're using, it depends on the style of if it's in the pan or on screen or whatever, and then you throw it in the box, you cut it up, send it on its way.

April Baer: Bob's your uncle.

Keith Heim: Exactly. The whole point is, uh, keep it simple, and production.

Laura Weber-Davis: And for Little Caesar's, speed was crucial. Here's Denise Ilitch.

Denise Ilitch: We were a carryout and are a carryout concept, and so we promised 15-minute service from the time you ordered your pizza to the time you picked it up.

April Baer: Some people, like maybe on the internet, say that Mike Ilitch actually invented the conveyor oven to speed up this process. And so we actually asked Denise about this claim.

Denise Ilitch: Well, it certainly. … He certainly was a pioneer in creating a conveyor oven. And the reason that it was so critical for us is that we were serving two pieces for the price of one. So we had additional pizzas to move through the store quickly and be able to service our customers.

April Baer: So you see, even Denice will state that her dad was a pioneer, but not the originator. Mike Ilitch actually does have two U.S. patents to his name. Both are for different models of a carryout food tray.

Laura Weber-Davis: And then there's the patents that Little Caesars Enterprises is assigned. There's a Little Caesars-themed jungle gym, patented.

April Baer: They totally have to bring that back.

Laura Weber-Davis: They do not, because pizza grease and jungle gyms don't go together. Other patents that Little Caesars held were a pizza-breadstick combo product, and a method for preparing pizza.

April Baer: But no sign of a pizza oven.

Laura Weber-Davis: Right. We found an anecdote of another Michigander who claims that his pizza shop, a shop called Pizzuti's in Westland, that he started using a conveyor oven in 1976, which was one year before Mike Ilitch probably started using it. But, you know, all of this, it's just really hard to document.

April Baer: Mike Ilitch may not have invented the conveyor oven, but he helped to usher it into wider circulation and used it to expand his business with ease. The conveyor oven quickly became a staple in the late 70s to early 80s, and it changed the game.

Keith Heim:  Very much so.

April Baer: Here's Keith Heim again, talking to us after his oven repair job.

Keith Heim: Very much so. I mean, it's so less labor intensive. You don't stand there and hover the oven. I mean, I did the same thing when I was 14. I had to. … That's what I made. I made pizzas in the hot room and in the hot oven, and constantly spinning them and maintaining them. If you walk away – ope! That's burnt!

April Baer: Now that our pizza is hot out of the oven, it's time to get the product to the people.

Laura Weber-Davis: And this is where we have one more Michigan pizza industry innovation. And this is one that we all take for granted. Like, "Yeah, of course!" But it actually wasn't always this way. And it's the box. The pizza box.

April Baer: Why are boxes such a big deal in the industry?

Jenny Fouracre: Oh my gosh! Because that's how you, like, show up at the customer's door! You have to care about the box. It's important!

April Baer: That's Jenn Fouracre at Domino's HQ.

Laura Weber-Davis: Is the corrugated box embraced at Domino's as something that Domino's really pioneered or championed from the beginning?

Jenny Fouracre: Oh, we know that we did. I mean, I think that's part of the core of our history is that, you know, Mr. Monaghan, when, you know, he was thinking very. … He's very focused on operations and everything that went into making the best store and the best pizza experience. That was something that, you know. … Those boxes were something that he focused on and worked on with our box manufacturer.

Scott Weiner: Tom said, "Efficiency. It's all about that. It has to stack neatly in the store. It has to look good, and it has to hold onto the heat of the pizza." 

April Baer: Scott Wiener of Scott's Pizza Tours in New York City. He says Tom Monaghan insisted on using a corrugated cardboard box for Domino's pizzas instead of the paperboard boxes that, like, you'd get at a bakery.

Scott Weiner: And I interviewed Tom Monaghan for when I put out my book about pizza boxes, and I'll never forget that conversation. The best thing that ever happened was at the very end of it. And I said, "Well, you know, you've had such an impact on pizza boxes, because Tom Monaghan and Domino's really brought about the ubiquity of the corrugated pizza box." And I said, "Oh, you're this pioneer, you really brought this whole thing." And I said, you know, "Is there anything else that you want us that you want to add to the story?" And he says, "I just never thought a pizza box was very important, and I'm shocked to hear anybody is writing a book about it." And I was like, "Wait. But what do you mean? In your book, you write about how you went to Triad, this paper company, and you begged them to design this box, and you engineered a way out of the problems that they were having with it." It was like the one element of the puzzle that he didn't remember every detail with when they talked him on the phone.

Laura Weber-Davis: Who wouldn't want to write a biography about the pizza box? A page turner, if you ask me. The corrugated boxes played a role in a whole system of efficiency within Domino's. It's important!

Scott Weiner: He wasn't so concerned about the pizza itself. He was more concerned about how it got to the customer, which is why Domino's became famous as a delivery brand, and the 30 minutes or less became the big deal for Domino's. They weren't the first to deliver a pizza, not by far. But they revolutionized the way that delivery works. And they're still doing that.

Laura Weber-Davis: Well, you can see where this is going. With the right factors and processes in place, the right attention to efficiency, it was possible for each of these pizza brands to expand beyond the basic concept for their stores. So with these innovations and efficiencies, both Domino's and Little Caesars really start picking up steam in an American economy that's embracing the franchisee model for fast and cheap food. Here's Denise Ilitch.

Denise Ilitch: Dad said that he was flying on an airplane, and he was sitting next to an oilman from Texas, and they struck up a conversation, and he started talking about royalties, and how lucrative and profitable royalties are in the oil business. And that really piqued his interest in franchising.

Laura Weber-Davis: And this is the thing that's starting to happen in American food all over the place. Americans are getting interested in fast food, and with consistent taste over multiple storefronts, and the business opportunities therein are abundant.

April Baer: Throughout the 1950s, other chains had set a precedent of affordability, convenience, and consistency. McDonald's led the pack.

McDonald's Ad: Ronald, hey Ronald! Here I am, kids! Hey, isn't watching TV fun? Especially when you've got delicious McDonald's hamburgers. 

April Baer: And others started following suit. You've got your KFC.

McDonald's Ad: Kentucky Fried Chicken made from the Colonel's secret recipe of 11 herbs and spices.

April Baer: You've got your Taco Bell.

McDonald's Ad: Taco Bell, the best Mexican food in town. Is that the bell? Sí.

April Baer: All offering convenience to American families.

Laura Weber-Davis: And it was a convenient business model, too. Denise says Little Caesars began franchise expansion along the I-75 corridor from Michigan to Florida.

April Baer: From there, they expanded to the coasts.

Denise Ilitch: I, you know, started there when I was 14. And as my career grew, the company grew. I went from, like, a pizza person, to a receptionist, to a secretary, to a law clerk. I kind of just moved up. And it was at that time when we went national with national television, and I was responsible for all of our commercials. It was at that moment that I realized that we were not a local mom and pop chain or a regional pizza chain, but we were a national chain.

Laura Weber-Davis: And the same thing is happening with rapid growth at Domino's. They expand quickly with franchisees in the Midwest and in the East Coast, focusing on areas with college campuses, and then military bases.

Carol Hestosky: They're not only saturating American markets, but Domino's is expanding outward.

April Baer: Carol Helstosky, author of “Pizza: A Global History.”

Carol Hestosky: They're also trying to cater to what they understand are local tastes. And when Domino's, for example, expands into the northeast, they understand that people there like thin crust pizza, or crust that's thinner. So they offer that in addition to their standard pizza. And that kind of becomes the Domino's model, where, if they're moving into an area, they'll stand back and observe and say, okay, what are local ingredients that people might like?

April Baer: It's a phenomenon that scholars call "glocalization" as opposed to globalization.

Carol Hestosky: Domino's goes from having, I think, a couple hundred right restaurants in the end of the 70s. It decides in '83 to go international, expanding into, first, Canada. And now, of course, it's global. But by 1989, Domino's has thousands of restaurants.

April Baer: So let me get this straight. Once the pizza franchise model is proved successful, the dominoes start falling, so to speak.

Laura Weber-Davis: Ugh, no.

April Baer: But it's true! Pizza Hut has been banging away out of its headquarters in Wichita, Kansas.

Laura Weber-Davis: At the same time, Michigan's Hungry Howie's opens in Taylor, Michigan.

April Baer: Jet's Pizza, which might be the regional chain most widely recognized as serving Detroit style, pops up in Sterling Heights.

Laura Weber-Davis: And in 1984, not to be lost in the sauce, Papa Johns joins the chain pizza industry.

April Baer: It didn't take long for all these brands to get up in each other's business. In our next episode, we'll talk about what the most successful players started doing with their pizza power.

Stephen Henderson: It'd be really hard to imagine, Detroit, downtown Detroit, today if you didn't have the Ilitch family.

April Baer: That's next time on Dough Dynasty.

April Baer: You've been listening to Dough Dynasty, a limited-run podcast series from Michigan Radio. I'm April Baer, thin crust, mushroom, and pepperoni.

Laura Weber-Davis: I'm Laura Weber-Davis. Pineapple Detroit-style deep dish, thank you very much. If you like what you've heard, share the pod with a friend. People who pod together, and pizza together, stay together.

April Baer: There is much more than the pod. Sign up for our newsletter to get exclusive pizza-related content and more fun stuff at MichiganRadio.org/pizza. Today's episode was produced by Ronia Cabansag, pepperoni and hot honey devotee.

Laura Weber-Davis: What? That's amazing. Other producers on the podcast are Mercedes Mejia, April Van Buren, and OG pizza delivery guy Mike Blank. Rachel Ishikawa is the podcast editor.

April Baer: Our web team is Jodi Westwick and Paulette Parker, with help from Emma Winowiecki. Special thanks to pizza consigliere Holly Eaton, Zoe Clark, and Rebecca Williams, and to Tesla Kresch, Olivia Mouradian, and Cate Weiser. Thanks also to John Correll for telling us about Pizzuti's, and to the Bentley Historical Library for archival audio.

Laura Weber-Davis: And thank you to Steve Green, publisher of PMQ Pizza Magazine, for giving us some big-picture perspective on Michigan's pizza story. We really appreciate all of his industry wisdom.

April Baer: Our theme music is from Personal and The Pizzas. Additional music from Audio Network and Blue Dot Sessions.

Laura Weber-Davis: Till next time, pass the red pepper flakes, and for heaven's sakes, tip your driver.

April Baer: I mean, at least 20%, right?

Laura Weber-Davis:Yes, at least. Bye!