| Villa Enterprises |
| Hospitality | |
| Friday, 01 June 2007 | |
![]() From a tiny New York pizzeria to a 300-location international chain, this restaurant company hasn’t lost its old-world charm, says Biagio Scotto. When Michele Scotto came to the US from Naples in the early ’60s, he had little more than a few authentic Italian recipes, a knack in the kitchen, and an old-world sense of hospitality. In 1964, he opened up a hole-in-the-wall pizzeria next to the Ed Sullivan Theater in New York City where he made dishes from scratch and won the hearts—and stomachs—of customers. Over the years, the company grew slowly, but in the 1990s, Michele’s sons Biagio and Anthony joined the family business and initiated an aggressive yet calculated growth strategy that brought the company to 100 locations within a few years. Since then, it has tripled in size. Today, Villa Enterprises has more than 300 locations representing five brand concepts throughout the US, the UK, Italy, the Czech Republic, Jordan, Kuwait, and most recently, Mexico. No matter how large the company grows and changes, a few things will remain the same: quality meals made with fresh ingredients, superior customer service, and old-world charm. “We are constantly adapting our old-world values to today’s marketplace, mainly in the way we communicate with our customers,” said Biagio Scotto, president of the Morristown, NJ-based company.
![]() Biagio and Anthony Scotto
Although each restaurant makes recipes from scratch every day, the company has recently redesigned some of its Villa locations to showcase this process. “We can claim to use fresh ingredients, but seeing is believing, and our customers can see the dough being kneaded and the sauces boiling,” Biagio said. Despite the aggressive growth over the past decade, Villa Enterprises has an amazing $150 million in revenue and almost zero debt (it took on minimal debt during the acquisition). “It’s just good sense mixed with a little discipline.” Biagio explained that 20 years ago, Villa Enterprises hesitated to open a new store for lack of sufficient funds, but today, the issue isn’t money. The company only opens enough stores as it can operate with the utmost quality. “As a customer, if you have one bad experience in a store that has been open for five years, you might blame it on chance if the rest of your experiences have been positive. But at a brand new store, you might not be so forgiving, which is why it is so important to have the right staffing and infrastructure available for every new location. To do that, we carefully control our growth by not jumping on every opportunity that comes our way.” To grow to it current 300 locations, Villa Enterprises’ restaurants are 50% company owned and 50% franchise owned. Biagio would like to see that ratio shift to 40% and 60%, respectively, but it is this delicate balance that makes for successful growth. He explained that the company dove into the franchise business with the purchase of Everything Yogurt Brands, as many of its locations were operated by local businesspeople. Biagio explained that corporate enjoys getting its hands dirty, and with 40-plus years of experience, it can make decisions more quickly than a franchisee. “My family grew up on a farm in Italy, so it’s second nature to do everything from getting the ovens going in the morning to mopping the floors at night,” he said, adding that he likes the idea of teaching new franchisees through example. “We need to make sure we are successful before we can tell our franchisees how to succeed.” But in some cases, Biagio has put the mop down and accepted the benefits of franchising. For starters, it allows the company to enter retail situations it was not able to previously. For instance, the company operates several restaurants in airports and universities, but airport locations often require retail operators to qualify as a disadvantaged business enterprise (DBE), which Villa Enterprises is not. By teaming up with a DBE as a franchisor, both the franchisee and Villa can take advantage of those situations. Villa Enterprises has its foot in the door of certain international markets thanks to franchising. At this time, it is only expanding the Villa Fresh Italian Kitchen chain by partnering with strong franchise operators overseas. Villa Enterprises is also gearing up to expand its corporate-run stores in those areas by establishing an international team working out of an office in Paris. “We’re having great success. In fact, our sales have grown consistently in Italy, and as far as I’m concerned, if we can sell pizza in Italy, we can sell it anywhere,” Biagio laughed. |
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