YRI Guidance on Pizza Hut Dough Commissary
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YRI Guidance on Pizza Hut Dough Commissary. August 1, 2012. YRI Commissary Classification System. Financial Model - Market Inputs. Need Accurate Data: Average Annual Store Sales. Pies per order ratio SSSG and Transaction Growth are averages for all stores

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YRI Guidance on Pizza Hut Dough Commissary

August 1, 2012


YRI Commissary Classification System


Financial Model - Market Inputs

  • Need Accurate Data:

    • Average Annual Store Sales.

    • Pies per order ratio

    • SSSG and Transaction Growth are averages for all stores

    • # Stores is the final number after 10 years

  • PHD vs PBP mix

  • Size mix – important to determine dough weight.

  • Store Count Forecast

    • Based on a 10 year build

    • Start with Existing number of Stores

    • Contract Par Baked Pan


Financial Model - CAPeX

  • Commissary CAPeX:

    • Design & Construction; Architectures

    • Building Equipment; i.e. HVAC, Proofing Room, & Refrigeration.

    • Dough Making Equipment; Mixer, Divider / Rounder, Sheeter, Oven, MD, etc.

    • Taxes; Duties will vary by country

  • Rent; Assumes facility is leased for 10 yr. Duration. The rate per m2 will be one of the site location criteria.

  • Store CAPeX avoidance for new builds only.

  • New Store rent and depreciation also predicated on smaller footprint which was assumed to be up to 20%.


Financial Model – CF Summary


Outputs estimate of space required

C2 – 20 Stores

Capacity Calculator – Space Requirements

2,830 Trays Required

189 Dollies Required

90 Dolly Positions in Cooler

Enter Estimated

Transactions & Product Mix

20 Stores

900 Transactions/wk/store

1.5 Pies Per Transaction

5 days Operating per Week

20% Family Pan

80% Medium Traditional

Engineered Solution

C2 – 1 Shift

Approx. 4,950 Sq. Ft.


Outputs estimate of space required

C2 – 60 Stores

Capacity Calculator – Space Requirements

8,500 Trays Required

566 Dollies Required

270 Dolly Positions in Cooler

Enter Estimated

Transactions & Product Mix

60 Stores

900 Transactions/wk/store

1.5 Pies Per Transaction

5 days Operating per Week

20% Family Pan

80% Medium Traditional

Engineered Solution

C2 – 2 Shifts

Approx. 6,900 Sq. Ft.


Outputs estimate of space required

C2 – 100 Stores

Capacity Calculator – Space Requirements

14,150 Trays Required

950 Dollies Required

450 Dolly Positions in Cooler

Enter Estimated

Transactions & Product Mix

100 Stores

900 Transactions/wk/store

1.5 Pies Per Transaction

5 days Operating per Week

20% Family Pan

80% Medium Traditional

Engineered Solution

C2 – 3 Shifts

Approx. 8,200 Sq. Ft.


C2 Future Expansion: 20 Stores - 1 Shift

175 sq ft Ingredient Storage Usage

Processing

Estimated

7,820 sq ft of Total Space

Proofing & Retarding

435 sq ft

Cooler Usage

Packaging

Tray/Pan Washing

Par-Baking


C2 Future Expansion: 60 Stores – 2 Shifts

336 sq ft Ingredient Storage Usage

Processing

Estimated

7,820 sq ft of Total Space

Proofing & Retarding

1,100 sq ft Cooler Usage

Packaging

Tray/Pan Washing

Par-Baking


C2 Future Expansion: 100 Stores – 3 Shifts

500 sq ft Ingredient Storage Usage

Processing

Estimated

7,820 sq. ft of total space

Proofing & Retarding

1,700 sq. ft Cooler Capacity

Packaging

Tray/Pan Washing

Par-Baking


Appendix

Appendix


Pizza Hut Commissaries and PHD Stores

32 COMMISSARIES (21 -C1, 11-C2&C4) **

2012

500 STORES SUPPORTED

2011

27 COMMISSARIES

338 STORES SUPPORTED*

15 COMMISSARIES

2010

195 STORES SUPPORTED

6 COMMISSARIES

2009

163 STORES SUPPORTED

2008

# of Commissaries

3 COMMISSARIES

71 STORES SUPPORTED

# of PHD’s

2007

1 COMMISSARY

21 STORES SUPPORTED

450

50

100

250

300

150

200

350

400

* Data as of October 2011

** Includes 2012 forecast


Commissary Roles and Responsibilities of Dallas vs Field

Dallas

BMU/FBU

Field all initial Franchise commissary requests

Resource to:

Define 10 year Growth Potential

Cascade & review Financial Model

Approve Site Selection

Approve Construction of facility conforming with latest manual

Start-up Support

Make each facility ready for CCA & STAR audit

Understanding Contractual Agreements

  • Define & Develop :

    • QA/Sanitation Policies (CCA)

    • Training Materials (Business Model)

    • Facility/Ops processes & systems

    • Commissary Contract

  • Approve:

    • Critical equipment specs

    • Layout & Workflows

  • Review Committee process for exceptions to recommended layout and business model.

  • Central Repository for all necessary information (Website)


Commissary 3-Step Process


Financial Model – Store Level P&L


Financial Model – Commissary Ingredient Costs

  • Dough Ingredient Expense based on 100kg batch:

    • Flour; will vary by market

    • Instant Dry Yeast available locally.

    • Oil per spec.

    • Lesaffre improver

  • Assumes 3 sizes for both PBP and PHD.

  • Store CAPeX avoidance for new builds only.

  • Smaller batches will have proportionate ingredient amounts associated.


Financial Model – Commissary Wages

  • This sheet shows one of three 8hr shifts:

    • Can also be two 10hr shifts with 4hrs Cleaning & PM.

    • Assumes 9 team members. One of whom will be Shift Lead

    • Hourly wage will vary. Supervisor 1.5X team member

  • General Manager/QA Manager & Admin as full time employees.

  • This team member modeling based on 15% PBP. Please refer to Labor Table.


Financial Model – Market Inputs

  • Fridge Truck:

    • $100,000 CAPeX

    • $10,000/yr Depreciation.

    • Labor expense of $10,000/yr could vary greatly.

    • R&M costs assumed to be outsourced but could be internalized with Maintenance Manager

    • Insurance $7,500 is just for internal investment.

  • Gas Expense assumes daily delivery 6 days per week at average of 500 miles per day driven.

  • Outsource Logistics of additional 50% contingency assumed for modelling.


Key Cash Flow Drivers


Fresh Commissary: Equipment


Fresh Commissary: Assumptions


Fresh Commissary: Capital Estimates


Fresh Commissary: Capability Comparison


Process Flow - Typical

Load Hopper

Verify Weight

Traditional

Warm Bowl

Add Ingredients

Place in Tray and

Spray with Oil

Mix

Divide & Round

Place in Pan and

Spray edges with Oil

Place on Cooling Tray

Proof & Retard

Par-Baked

Pan

Temper 30min

Bake 3 minutes

Package in Bags

Let Dough Rest

minimum of 3 minutes

Store & Ship

Add Perforated Pan

Sheeting


Real Opportunities for Innovation

vs.

  • Water Metering – Automate temperature controlled water delivery to remove manual measurement with flow meter, load cells, etc.

  • Sheeting Throughput – Increase capacity of sheeters to reduce manpower, floor space, and bottlenecking.

  • Pan Oiling – Automate pan oiling with wiper or spray arm to remove manual pumping and pan rotation for coverage.

  • Pan Denesting/Stacking –Automate processes of staging pan, adding lid, stacking and racking pans for Proofing.

  • Proofing and Retarding – Spiral accumulation and singulation to/through Retarding. Consistent timing for continuous Proofing/Retarding process.

  • Right Size Oven - Maximize throughput to match continuous dough ball/pan speed. Eliminate Retarding time by oven outrunning production and going directly from Proofing to Oven.


Process Flow

C1 – Option 1

C2 – Manual

C3 – Automatic

(See Appendix)

(See Appendix)

(See Appendix)

C1 – Option 2

C2 – Automatic

(See Appendix)

(See Appendix)


C1 Equipment Optimization

5 Day

Store

Shelf Life

Traditional:

C1 – Option 1Sized for 5 Stores8 hours of production

20min Max

Cold Proof

48hrs

  • (1) Hobart HL662 Mixer

  • 10kg Batches

  • Pan Family Pies 37

  • Traditional 10” 64

  • 48 kg/hr

Par-Baked

Pan:

3-10min

Rest

Proof

1hr

Retard

1 to 2hrs

Tempering

30min

Store

1 Day

4 Day

Store

Shelf Life

  • (1) Doyon DFP18 Sheeter

  • 3-10 min Rest

  • Batch processed within 10 minutes

  • 8pcs/min per machine

  • 200 kg/hr

  • (1) Middleby Marshall

  • PS555 Oven

  • 2.5 to 3 minute bake time

  • Batch processed within 20 minutes

  • Pies per/hr per Oven:

    • Family 131

  • 55 kg/hr

  • Manual Dividing/Rounding

  • Batch must be Divided/Rounded

  • within 20 minutes

  • 6 pcs/min per employee

  • One employee

  • 90 to 150 kg/hr

Note: Equipment specification for example only.


C1 Equipment Optimization

5 Day

Store

Shelf Life

Traditional:

C1 – Option 2Sized for 5 Stores5 hours of production

20min Max

Cold Proof

48hrs

  • (1) Thunderbird ASP-200 Mixer

  • 80kg Batches

  • Pan Family 188

  • Traditional 10”517

  • 380 kg/hr

Par-Baked

Pan:

3-10min

Rest

Proof

1hr

Retard

1 to 2hrs

Tempering

30min

Store

1 Day

4 Day

Store

Shelf Life

  • (1) AM S302 Divider/Rounder

  • Batch must be Divided/Rounded

  • within 20 minutes

  • 30pcs/min per machine capacity

  • 440 to 765 kg/hr

  • (2) Doyon DFP18 Sheeters

  • 3-10 min Rest

  • Batch processed within 30 minutes

  • 8pcs/min per machine

  • 408 kg/hr

  • (1) Middleby Marshall

  • PS555 Oven

  • 2.5 to 3 minute bake time

  • Batch processed within 60 minutes

  • Pies per/hr per Oven:

    • Family 131

  • 55 kg/hr

Note: Equipment specification for example only.


C2 Equipment Optimization - Manual

5 Day

Store

Shelf Life

Traditional:

C2 Sized for Up to 100 StoresUp to 24-hour Production

20min Max

Cold Proof

48hrs

Par-Baked

Pan:

3-10min

Rest

Proof

1hr

Retard

1 to 2hrs

Tempering

30min

Store

1 Day

4 Day

Store

Shelf Life

  • (1) Thunderbird ASP-200 Mixer

  • 90kg Batches

  • Pan Family 335

  • Traditional 10”582

  • 142 to 427 kg/hr

  • (1) Automated Scale

  • Check weight of every dough ball

  • 30pcs/min per machine

  • 440 to 765 kg/hr

  • (1) AM S300 Divider/Rounder

  • Batch must be Divided/Rounded

  • within 20 minutes

  • 30pcs/min per machine capacity

  • 440 to 765 kg/hr

  • (2) Doyon DFP18 Sheeters

  • 3-10 min Rest

  • Batch processed within 30 minutes

  • 8pcs/min per machine

  • 408 kg/hr

  • (3) Middleby Marshall

  • PS555 Ovens

  • 2.5 to 3 minute bake time

  • Batch processed within 20 minutes

  • Pies per/hr per Oven:

    • Family 131

  • 167 kg/hr

Note: Equipment specification for example only.


C2 Equipment Optimization - Automatic

5 Day

Store

Shelf Life

Traditional:

C2 Sized for Up to 100 StoresUp to 24-hour Production

20min Max

Cold Proof

48hrs

Metal

Detection

Par-Baked

Pan:

3min

Rest

Store

1 Day

4 Day

Store

Shelf Life

Tempering

30min

  • (1) Horizontal Mixer

  • 100kg Batches

  • Pan Family 372

  • Traditional 10”647

  • 475 kg/hr

Proof

1hr

  • (1) Automated Scale

  • Check weight of every dough ball

  • 33pcs/min per machine minimum

  • 440 to 765 kg/hr

Metal

Detection

  • (1) Divider/Rounder

  • Batch must be Divided/Rounded

  • within 20 minutes

  • 33pcs/min per machine minimum

  • 485 to 841 kg/hr

  • (2) Sheeters

  • 3min Rest (conveyor)

  • Continuous processing

  • 17pcs/min per machine minimum

  • 867 kg/hr

  • Continuous Proofer & Conveyor Oven

  • 2.5 to 3 minute bake time

  • Batch processed within 20 minutes

  • Pies per/hr: Family 1,116

  • 475 kg/hr

Note: Equipment specification for example only.


C3 Equipment Optimization

5 Day

Store

Shelf Life

Traditional:

C3 Sized for 100+ Stores24-hour Production

20min Max

Cold Proof

24hrs

Metal Detection

Par-Baked

Pan:

3min

Rest

Tempering

30min

Store

1 Day

4 Day

Store

Shelf Life

Proof

1hr

Metal Detection

  • Continuous Proofer & Conveyor Oven

  • 2.5 to 3 minute bake time

  • Batch processed within 20 minutes

  • Pies per/hr: Family 5,592

  • 2,400 kg/hr

  • (2) Horizontal Mixers

  • 250 kg Batches

  • Pan Family 932

  • Traditional 10”1617

  • 2,400 kg/hr

  • (2) Divider/Rounders

  • Batch must be Divided/Rounded

  • within 20 minutes

  • 100 pcs/min per machine capacity

  • 2,940 to 5,100 kg/hr

  • (2) Automated Scales

  • Check weight of every dough ball

  • 100pcs/min per machine

  • 2,940 to 5,100 kg/hr

  • (2) Sheeters

  • 3min Rest (conveyor)

  • Continuous processing

  • 100pcs/min per machine minimum

  • 5,100 kg/hr

Note: Equipment specification for example only.


Conceptual Commissary Layouts

C1 – Option 1

C2 – 20 Stores

C2 – Automatic

C3 – Automatic

(See Appendix)

(See Appendix)

(See Appendix)

(See Appendix)

C1 – Option 2

C2 – 60 Stores

(See Appendix)

(See Appendix)

C2 – 100 Stores

(See Appendix)


C1 Layout – Option 1

Utilize Store Oven during Off Hours

Additional

515 sq. ft. built out from typical store

C1 – Option 1

(1) Hobart 60Qt Mixer

Manual Dividing/Rounding

(1) Sheeter

(1) Oven (Store Oven, Off Hours)

(4) Estimated Employees

Additional

116 sq. ft. of Cooler Space


C1 Layout – Option 2

Utilize Store Oven during Off Hours

Additional

830 sq. ft built out from typical store

C1 – Option 2

(1) Thunderbird 200kg Mixer

(1) AM Divider/Rounder

(2) Sheeters

(1) Oven (Store Oven, Off Hours)

(3) Estimated Employees

Additional

142 sq. ft of Cooler Space (Storage & Retarding)


C2 Layout

C2 – 20 Stores

(1) Thunderbird 200kg Mixer

(1) AM Divider/Rounder

(2) Sheeters

(3) Ovens

(11) Estimated Employees

Estimated

4,875 sq. ft. of Total Space

Processing

Proofing & Retarding

435 sq. ft. Cooler Capacity

Packaging

Par-Baking

Tray/Pan Washing


C2 Layout

C2 – 60 Stores

(1) Thunderbird 200kg Mixer

(1) AM Divider/Rounder

(2) Sheeters

(3) Ovens

(26) Estimated Employees

Processing

Estimated

6,665 sq. ft of total space

Proofing & Retarding

1,100 sq. ft Cooler Capacity

Packaging

Tray/Pan Washing

Par-Baking


C2 Layout

C2 – 100 Stores

(1) Thunderbird 200kg Mixer

(1) AM Divider/Rounder

(2) Sheeters

(3) Ovens

(39) Estimated Employees

Processing

Estimated

7,820 sq. ft of total space

Proofing & Retarding

1,700 sq. ft Cooler Capacity

Packaging

Tray/Pan Washing

Par-Baking


C2 Automatic Layout

C2 – 100 Stores

(1) 200kg Horizontal Mixer

(1) Divider/Rounder

(2) Sheeters

(1) Continuous Proofer/Oven

(6) Estimated Employees

Bulk Ingredients

Estimated

16,500 sq. ft of total space

Processing

Tray Packing & Metal Detection

1,700 sq. ft Cooler Capacity

Proofing

Tray/Pan Washing

Par-Baking

Packaging & Metal Detection


C3 Layout

Proofing

Par-Baking

Sheeting

Cooling

Processing

Packaging

Bulk Ingredients

5,615 sq. ft Cooler Capacity

Tray/Pan Washing

Estimated

56,700 sq. ft of total space

C3 – 100+ Stores

(2) Horizontal Mixers

(2) Divider/Rounders

(2) Sheeters

(1) Continuous Proofer/Oven

(12) Estimated Employees


C1 Production Time Study

C1 – Option 1

(1) Hobart 60Qt Mixer

Manual Dividing/Rounding

(1) Sheeter

(1) Oven(Store Oven, Off Hours)

Traditional

1 Shift

Up to 5 Stores

22 Batches/Day

4 Employees

Par-Bake

1hr

2hrs

3hrs

4hrs

5hrs

6hrs

7hrs

8hrs

9hrs

10hrs

C1 – Option 2

(1) Thunderbird 200kg Mixer

(1) AM Divider/Rounder

(2) Sheeters

(1) Oven (Store Oven, Off Hours)

Traditional

1 Shift

Up to 5 Stores

3 Batches/Day

3 Employees

Par-Bake

1hr

2hrs

3hrs

4hrs

5hrs

6hrs

7hrs

8hrs

9hrs

10hrs


C2 Manual Production Time Study

1 Shift

Up to 20 Stores

10 Batches/Day

11 Employees

C2 – Option 1

(1) Thunderbird 200kg Mixer

(1) AM Divider/Rounder

(1) Automated Scale

(2) Sheeters

(3) Ovens

2 Shifts

Up to 60 Stores

28 Batches/Day

26 Employees

1hr

2hrs

3hrs

4hrs

5hrs

6hrs

7hrs

8hrs

9hrs

10hrs

3 Shifts

Up to 100 Stores

46 Batches/Day

39 Employees

1hr

2hrs

3hrs

4hrs

5hrs

6hrs

7hrs

8hrs

9hrs

10hrs

11hrs

12hrs

13hrs

14hrs

15hrs

Traditional

Par-Bake

1hr

2hrs

3hrs

4hrs

5hrs

6hrs

7hrs

8hrs

9hrs

10hrs

11hrs

12hrs

13hrs

14hrs

15hrs

16hrs

17hrs

18hrs

19hrs

20hrs

21hrs

22hrs

23hrs

24hrs


C2 Manual Production Labor Optimization

Traditional

Par-Bake

2 Shifts

Up to 100 Stores

42 Batches/Day

30 Employees

1hr

2hrs

3hrs

4hrs

5hrs

6hrs

7hrs

8hrs

9hrs

10hrs

11hrs

12hrs

13hrs

14hrs

15hrs

C2 – Optimization

(1) Thunderbird 200kg Mixer

(1) Divider/Rounder

(1) Automated Scales

(2) Sheeters

(9) Ovens

Optimize Oven Size


C2 Automatic Production Time Study

2 Shifts

Up to 100 Stores

42 Batches/Day

6 Employees

Traditional

Par-Bake

1hr

2hrs

3hrs

4hrs

5hrs

6hrs

7hrs

8hrs

9hrs

10hrs

11hrs

12hrs

13hrs

14hrs

15hrs

16hrs

C2 – Automatic

(1) 200kg Horizontal Mixer

(1) Divider/Rounder

(2) Automated Scales

(2) Sheeters

(1) Continuous Proofer/Oven

(1) Spiral Cooler

(1) Automated Bagger/Tray Packer

(1) Automated Dough Ball Tray Packer


C3 Production Time Study

1 Shift

285 Stores

47 Batches/Day

12 Employees

Traditional

Par-Bake

1hr

2hrs

3hrs

4hrs

5hrs

6hrs

7hrs

8hrs

9hrs

10hrs

11hrs

12hrs

C3 – 100+ Stores

(2) Horizontal 400kg Mixers

(2) Divider/Rounders

(2) Automated Scales/Metal Detectors

(2) Sheeters

(1) Continuous Proofer/Oven

(1) Spiral Cooler

(1) Automated Bagger/Tray Packer

(1) Automated Dough Ball Tray Packer


Commissary Cost Comparison


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