Dollar_Pizza

The Piecemeal Economics of the Dollar Pizza Slice

How the hell can a business survive by selling a meal for just a buck?

Everything’s getting more expensive these days. But with the cost of living getting sky-high and showing no signs of slowing down, how the hell can you still find pizza for a dollar a slice? How does a business in 2020 even survive that way? Does it mean that every other pizza you’ve ever eaten is a rip-off? Alongside Anthony Falco, an international pizza consultant based in New York City, we sliced up some answers.

What’s the deal with dollar pizza, anyway?

Well, of course, there was once a cheaper time in America when pizza normally cost a buck and nobody thought that was strange. But if we’re talking about modern times? It’s hard to say, though Vancouver, Canada, has the probable distinction of inventing the concept several decades ago. Dollar pizza joints are — or at least once were — everywhere there. A cheese slice would cost you exactly one Canuck buck, and they were available most any hour of the day.

Vancouver was where Falco first encountered dollar pizza, when he lived in Seattle in the early 2000s. “I was like, this is a magic trick, getting a slice of pizza for a dollar,” Falco says. “I’m gonna go around and eat them — one of them has got to be good. I went to every dollar slice pizza in Vancouver — there were a lot — and they were all pretty bad.”

Dollar slice pizza joints started popping up in New York City around the mid-2000s. It started with 99 Cent Fresh Pizza, which opened in 2006, followed most notably by 2 Bros. Pizza in late 2007. There are now many dozens of dollar-slice pizzas available in the city.

Why would anyone try to get by selling pizza for a dollar?

The two bros behind 2 Bros. have said it initially started as a marketing promotion for their new venture. But they had no idea how popular it would be — they had people lining up the morning after they painted the price on their awning and every day thereafter, so they were more or less stuck with the concept. But they discovered that all that volume could actually support the low price point — if they were able to move enough slices.

“[Dollar slices in New York City] really happened with the 2008 financial crisis,” Falco says. “Lots of different businesses would do recession specials. You could get dollar hot dogs, or find recession specials every day for things like a beer and a shot.”

It was in this recession-era milieu that dollar slices found their market and it persists for that very same reason: In the lines of dollar-slice joints stand everybody who wants their lunch to be cheap, fast or both: Wall Street bros are waiting in the same line as homeless people to eat the same food. “These dudes are doing God’s work: It’s amazing,” Falco says. “You see NYPD cops in line. They’re helping the working class of NYC get by.”

What’s actually in a dollar pizza?

It’s impossible to know what every dollar slice pizza joint is putting in their pizza, but Falco worked with the 2 Bros. founders on Upside Pizza, a more upscale pizza slice, so he has a small window into 2 Bros. business. He says (because of course he does) that it’s actually good ingredients! Real mozzarella, tomatoes, the same gas oven and equipment as most other pizza places — at least, all the ones that don’t have a fancy-ass wood-fired Neapolitan pizza oven.

But where high-quality pizza starts to separate is in the dough, Falco says. That’s where the base costs go up: Mozzarella’s mozzarella, tomatoes are tomatoes. “You’re not going to spend a lot on tomatoes and knock someone’s socks off,” he says. But quality dough takes time and labor and more expense in return for superior flavor and texture, whereas cheaper dough is made for speed and consistency — and, it must be said, it also lasts longer.

In a nutshell, fancy pizza uses stone-milled flour with naturally fermented starters that can take days to leaven, whereas cheaper dough uses white flour, and dry and instant yeasts that can be baked the same day.

So how do dollar-slice joints make the numbers work?

It’s not easy. Rent’s going up and minimum wage is (thankfully) increasing, and combined, it makes it a challenge to keep slices at a buck. Again, it’s about volume, because margins are obviously pizza-cutter thin. 2 Bros. says that, before labor — which is significant — it costs about 45 to 50 cents to make a slice. They have tremendous buying power and buy nearly everything direct from manufacturers, cutting out the middleman: They have trailers of cheese, trailers of flour and trailers of canned soda delivered direct. The specials help bring in more money, too, like two slices and a soda for $3 — there’s a decent markup on the canned, bubbly sugar water.

Most of the employee training has to do with speed: Serving the customers as quickly as possible, and being prepared with plenty of pies for the spikes in traffic each day. The bonus for the consumer, Falco says, is that everybody gets a really fresh, hot slice.

The recession is over… ahahahaha, I couldn’t even finish that sentence with a straight face. But really, there’s a whole bunch of rich jerks running around places like NYC these days. How have the non-fancy joints stayed open?

The advent of dollar pizza forced a serious economic reckoning within New York City’s pizza scene, according to Falco, and has continued to leave a mark. Before, when most slices in the city were in the $2.50 to $3 range, it was hard to tell where was good and where was bad. Dollar-slices forced a sort of shakeout of the mediocre pizza joints; nowadays, there’s good pizza, and there’s dollar pizza. “Which is kind of cool, because at this point you know what you’re getting,” Falco says. “There isn’t some dude named Pasquale back there making the pizza, but it’s dollar pizza and you know what to expect.” It also expanded the market for premium pizza, which Falco specializes in. 

Does the existence of dollar pizza prove that every other pizza in the world is a total rip-off?

Well, first off, dollar pizza can be good, but it’s not really ever great. But still, you want to know why $20 gourmet pizza costs so much more? Time, labor, equipment and fresh ingredients.

First off, the nicer oven can cost $25,000 to $50,000 (and may require wood to heat it) compared to a $15,000 standard pizza oven. The flour is stone-milled, not roller milled, which is more expensive considering that very few stone mills are left. And according to Falco, stone milling also makes the dough more nutritious: It includes the bran and the germ of the wheat (where more nutrients lie), and the natural fermentation from the starters unlocks the starch chains more fully, making a better crust.

There’s also different varieties of fresh cheeses, fresh (not frozen) toppings, artisanal pepperoni and sausage, etc., which increases the cost. You could say that a lot more goes into making a gourmet pizza, and the end result is far more complex flavors, a crust with more texture, and more nutrition — all of which customers will pay more for.

Falco used to do pop-ups all over Manhattan on behalf of Roberta’s, with a wood-fired oven, making Neapolitan-style pizzas with premium ingredients for $8 apiece. “Some people would come up saying, ‘What? This is a rip-off — I can get a dollar slice down the street.’ I’m like, ‘Yeah, okay buddy, go ahead. It’s not exactly the same.’”

Are they gonna stick around?

Maybe not. Pizza historian Scott Wiener points out that many 10-year leases that were signed during the recession, when dollar-slice pizza started proliferating, are coming up for renewal now. Dollar slices just aren’t sustainable, and might have to go up to, say, $1.50 sooner or later. Which is still cheap as hell, but it’s a 50 percent increase.

One curious bit of New York economics is known as the Pizza Principle, where the price of a slice of pizza is, historically at least, uncannily equal to subway fare. Dollar pizzas threw that principle way out-of-whack, and so perhaps we’re due for a market correction soon. But not too soon: The current price of subway fare? $2.75 — which can sound astronomical in pizza terms these days.