In the early weeks and months of the pandemic, the quick-serve pizza giants shared a common tailwind. Their roots in delivery and digital ordering gave them a significant head-start on the field. There was a less definable, more nebulous trend at work as well—the notion consumers flocked to comfort food when routines fell apart. And one place that took them to was pizza. Guests knew how to order it, where to do so, and what to expect from the experience.

Two-plus years later, it appears the category’s largest chains are sharing a boat again. Only now it’s a driver shortage breaching topics that once felt off the table, such as Domino’s rethinking its combative stance on third-party delivery.

Beyond broadening reach via aggregator networks, pizza chains are focusing on back-end fixes to ease the burden. Papa Johns is working to make recruiting more efficient, streamline payroll, and enable drivers to be more productive so they can take additional deliveries and spend less time in stores. It also unveiled “PapaCall” last August where the company brought artificial intelligence into its call center. Pizza Hut said it’s placing more emphasis on call centers as well. In early Q2, the chain completed the integration of delivery as a service into its point-of-sale. It’s layering in delivery as a service—over the next two to three quarters—which essentially means having sales flow through the website and apps, but then fulfillment, alongside working with aggregators.

Domino’s, too, expects between 2,500–3,000 stores to use call centers in some capacity before year’s end.

All will lean further into carryout: Domino’s saw carryout comps rose 11.3 percent, year-over-year in Q1.

And the impact of the driver shortage has been easy to spot. In Q1, Domino’s said, because of staffing challenges, store hours were reduced, phones weren’t answered, and online orders were restricted. In all, the number of combined lost operating hours equated to the entire U.S. system being closed for six days. Domino’s same-store sales declined 3.5 percent in the period. Notably, delivery comps declined 10.7 percent.

Pizza Hut’s same-store sales dropped 6 percent to start the year. CFO Chris Turner told investors at the time one franchisee who tapped third-party ran about 4 points ahead of the system.

Papa Johns stayed in the green at 1.9 percent against a prior-year lap of 26.2 percent. This credited to a few factors, but markedly to a premium product strategy and the company’s history with aggregator-aided delivery—something it began three years ago and spent roughly nine months building out integration to connect its POS to third-party ordering systems.

Without debate, though, pizza chains will continue innovating around delivery setbacks. Automation and AI to ease tasks in favor of others. Less phones ringing and more pizza getting made. But the tech will stretch to a point. Like labor inside quick-serves of every segment, figuring what employees want and making jobs easier has become as critical as paying them more.

BTIG analyst Peter Saleh, in an effort to better understand the driver shortage for pizza brands, surveyed 5,000 individuals across the U.S. to identify nearly 300 delivery drivers who have been active (last 30 days) on ride-share platforms like Uber and Lyft. The aim being to ask what it’s going to take to attract them back to restaurants.

Saleh said his original thesis was an increase in mobility, personal and corporate travel post-Omicron, has pulled drivers away from food delivery to more lucrative ride-share jobs. “While we continue to believe that our thesis has merit,” he said, “we found that drivers are still seeking more flexibility with respect to the days and hours they work and that rising gas prices are keeping some drivers from choosing food delivery.”

In a lot of ways, the findings weren’t all that different than demands made by a broader workforce pool about a year ago.

As the chart below shows, competition on the road isn’t letting up. Restaurants witnessed this pre-COVID and it’s returned in force, especially on Friday and Saturday nights (when pizza operators have the highest order volume). Amid the pandemic, pizza chains saw sales patterns shift, with weekday business rising above historic lines. This was particularly true at lunch due to remote work and less rigid schedules. Weekend sales, however, slowed a bit as consumers rerouted purchases to accommodate reduced mobility and work from home.

Saleh said following Omicron in January/February, people began to walk purchasing habits back to traditional weekend dinner and late-night, which accentuated the driver shortage given this is also peak time for ride-share and food delivery in general—a category that ballooned over the crisis stretch (it’s more than tripled globally since 2017). Statista believes online food delivery revenue will hit $24 billion by 2023.

“We believe this normalization is a leading cause of the driver shortage; consumer mobility has surged during the evenings and weekends, and consumer purchasing habits have migrated back to that time as well,” Saleh said.

Additionally, he added, subscription services such as DoorDash’s “Dashpass,” where consumers pay $9.99 per month for free delivery on orders above the minimum bucket size, are helping keep third-party drivers busy. At the same time, the offering generated loyalty among the aggregator’s customer base.

Saleh said the strategy is differentiated versus what’s being offered through first-party delivery by larger pizza chains and independents. It reduces the delivery cost for the heavy quick-service users that generally account for the bulk of sales.

Saleh noted the top 5 percent of guests typically mix 30 percent of the revenue, and the top 20 percent of consumers generate about 60 percent of the sales.

So larger chains operating a self-delivery model, he suggested, will need to either supplement with third-party aggregators, implement a subscription service, change their model to offer more flexible work schedules and/or raise fuel reimbursements if they’re going to compete more effectively for drivers.

What to offer

In Saleh’s study, flexibility, with respect to days/hours worked, ranked highest among drivers when choosing a platform to work for. Forty-four percent indicted greater flexibility was a determining factor, outpacing all-in pay, which was second (40 percent of drivers). Based on third-party studies and analysis done by Jack Fuller, Saleh shared, UberEats delivery drivers earn about $15 per hour, roughly $5 less than their ride-share counterparts. Simply, food delivery on the top-line is less attractive than ride-share, and even less so, Saleh said, for brands that require more rigid schedules.

The figures were more pronounced among younger drivers in the 18–24 cohort. There, 56 percent listed flexibility as their top priority. “… this suggests that restaurant concepts with their own delivery network will either have to supplement with aggregator partnerships or change their driver business model to resemble the flexibility of ride-share platforms,” Saleh said. “In our view, this would result in significantly more drivers per location, working fewer hours per day.”

With older workers, the survey returned they would rather just deliver food than work inside the restaurant folding boxes, answering phones, or doing other tasks. Forty-four percent of drivers aged 50–64 said the No. 1 reason they picked ride-share over food delivery was because they didn’t want to clock time inside restaurants. Saleh believes this is an opportunity for chains like Papa Johns and Domino’s to offer positions to drivers strictly to deliver food without the hassle of having to support the crew, too.

The survey’s last point looked at rising fuel prices. Nearly 40 percent (39) of respondents said gas prices were keeping them from taking on food delivery jobs. About a third of ride-share drivers noted they used to deliver food, but have since shifted to just transporting people.

Saleh said alternatives with higher hourly pay, more flexible scheduling, and rising prices at the pump are all limiting the availability of drivers for self-delivery concepts like the pizza sector’s “Big 3.”

Given the undercurrent of lasting changes tied to COVID, it’s unlikely brands can simply wait it out, either. “Restaurants dependent on self-delivery will need to institute more flexible schedules, raise the hourly pay and/or implement a fuel surcharge to become more competitive in this scarce market for drivers