Pizza is one of America’s most popular meal options. When that pizza is frozen, not only is it a convenient meal, but also an inexpensive one that will satisfy a variety of palates. Consumer demand for diversity in ingredients, crust types and quality cheese might have been what prompted the introduction of 84 new varieties of frozen pizza products just in 2010, according to the third edition of Frozen Foods in the United States.
For 30 years, the Ramsay family of Maple Lake, Minn., has been manufacturing and distributing frozen pizza under a variety of brands: Bernatello’s, the brand that built the company; Bellatoria, the company’s ultra-thin premium pizza with high-end Hormel meats and grilled vegetables; Roma, its value line; Green Mill pizza, which it manufactures and distributes through a licensing agreement; and its most recent acquisition, the Orv’s brand.
The company’s main distribution area is what Vice President Dave Ramsay calls “the pizza belt of America.” This region encompasses Minnesota, the Dakotas, Wisconsin, Illinois, Iowa and the upper peninsula of Michigan. Bernatello’s exports to Canada, too. At a national level, the Ramsays distribute a selection of their Bellatoria brand at Costco stores and Sam’s Clubs.
Rising Crust
Bernatello’s has expanded through the years with the acquisition of competitors. This has impacted not only the company’s size, but its operations, as well. In 2000, with the purchase of Roma Pizza, Bernatello’s replaced the warehouse distribution system it had used since its founding in 1982 with direct store delivery. “Roma, at that time, had 13 route-direct store deliveries,” Ramsay explains. “We did a comparison of the warehouse distribution versus the direct store delivery, and made a decision to go exclusively with direct delivery.”
Every time Bernatello’s purchases a company, it expands its family of products and adopts new manufacturing facilities and crust-baking methods. “We have an excellent Bellatoria garlic cheese bread that came to us from the Roma acquisition,” Ramsay says. “It’s not your typical frozen bread; it’s covered with cheese and heavy on garlic butter. It is a product that does very well.”
Bernatello’s most recent acquisition was in February with the purchase of Five Star Foods, the manufacturer of Orv’s pizza in Kaukauna, Wis. “The reason for this acquisition is that they were strong where we were weaker, like in the Wisconsin market,” Ramsay explains. “And we are strong in the Minnesota market, where they were weaker, so we have a solid presence in both states now.”
The Orv’s brand also expands the Bernatello’s product assortment with the addition of two higher-end products, the premium brand Borbellos and a rising-crust pizza. “We had never had a product in the rising dough category, so it expanded our product lineup in that segment,” Ramsay says.
The Five Star Foods acquisition included a bakery with a process of manufacturing crust that was new to Bernatello’s.
Stiff Competition
The company has seen consistent, 14 percent profit increases for the past five years. “Unfortunately, our product historically prospers in negative economic times,” Ramsay explains. “When things are going well, people eat T-bone steaks and porterhouses, but when things are tougher, they eat sirloin and chuck roast.”
But even during and following a recession, Bernatello’s still has had to face fierce competition. “We are always in competition with other companies, not only in the grocery store arena, but also with the national chains of pizzerias, like Pizza Hut or Domino’s,” he says. “They have been very aggressive in the last 15 to 24 months with deep discounts to recover marketshare.”
Going forward, Bernatello’s will consolidate its brands to remain competitive. “We will go forward with some of our existing brands,” Ramsay says. “We just launched a new brand called Brew Pub, and it’s a monster of a pizza. It is a 12-inch pizza, heavily topped with over half-a-pound of cheese on it, plus toppings.”
Bernatello’s also is counting on benefitting from the collective expertise of the former Five Star Foods owners. “The four owners of Five Star are a great asset,” Ramsay notes. “They did a great job building the Orv’s brand in a very difficult marketplace and they have over 150 year of experience collectively.”