How To Overcome a Poor Location, Intense Competition & High Prices

When Dom Demarco got off the subway station on a Saturday night fifty years ago, he noticed a ton of people walking in the street. Looking over to the next corner he noticed a modest corner storefront with a for rent sign in the window. He knew that was where Di Fara’s Pizza belonged and he was sure it would be a success. It is! You might be surprised why it is.

I know Dom’s pizza, I went to a high school two blocks from his shop. I could never eat there while I attended a private Jewish high school. I would have been suspended. I didn’t even taste his pizza until well after I graduated. Now I’m among his biggest fans and I want to tell you his story.

Dom has overcome five significant obstacles:

1. He has a small location that barely fits six tables.
2. He is in a high traffic location with seemingly good demographics that aren’t really potential customers.
3. His service is slow by design; it’s artisanal pizza and he makes every pie so there’s hardly ever less than a two-hour wait.
4.His prices are higher than other pizza shops; his slices are $5 a piece.
5. His store is in the most competitive pizza market in country.

Welcome to Di’ Fara’s

Di Fara’s is located in a not-too-hip part of Brooklyn, the predominantly Orthodox Jewish neighborhood of Midwood. As a location it’s less than ideal for a non-kosher restaurant. Nevertheless Di Fara’s pizza is legendary. He frequently tops almost every list in the country for top pizza slice.

Di Fara’s has only six mismatched tables and you’d have a hard time finding any matching chairs among them. For years he has faced closures and warnings for health code violations. While most pizza joints have their ovens set to 500 degrees his are set at 900 degrees and in the summer there’s no central air conditioning. You might not find the yellowish-green walls of his shop very appetizing. Yet this is the pizza restaurant he runs in the most competitive pizza market in the United States, in New York City.

While Pizza Hut (NYSE: YUM) and Domino’s (NYSE:DPZ) might be familiar in the rest of the country this is New York. Their occasional $5 pie specials aren’t so tempting. But if you want Dom’s hand crafted pizza you’ll happily fork over $5 a slice or $28 a pie while Dom’s rusty scissors snip fresh basil on to your pizza.

While he is not setting record sales like Domino’s or Pizza Hut did on SuperBowl Sunday he sells around 100 pies a day. He sells mostly by the slice which gives him $40 a pie. Dom loves what he does and watching him deliberately create every artisanal pie is like watching Leonardo Da Vinci paint the Mona Lisa. People are often offered $100 for a pie they just scored, I’ve seen it happen every time I’ve been there.

How does Dom get people to travel from miles away when most pizzerias survive on a five-minute drive time?

Dom doesn’t try to fool people; that would be hard to do in a market as critical as New York. To create his pies Dom uses the finest ingredients possible.  He loves making pizza and believes that everyone should only work at what they love to do. What makes his spot truly remarkable is that he delivers his pizza as if every bite matters.

Delivering a truly remarkable service or product is the ONLY way to overcome a poor location. Deliver something remarkable in a great location and you will flourish but you’ll have to work much harder to overcome the disadvantages of selecting anything other than the ideal spot.

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P.S. If I made you hungry there’s good news. You can hop on the subway from midtown Manhattan and take the one-hour ride to Di Fara’s on Avenue J the next time you’re in NY City. Or the next time you’re  at Ceasar’s Palace in Las Vegas you can sample some of this country’s best pizza. The Las Vegas Strip is a much better location but the slices aren’t identical to the ones prepared by pizza maestro Dom Demarco.