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TELE PIZZA LEOPOLDO FERNANDEZ PUJALS: [MADRID, SPAIN]

By Published on .

"Tell the competition Leo's back."The competition probably didn't need a reminder. Although the pronouncement came in November, on the day TelePizza became the first restaurant listing on the Madrid Stock Exchange, the company un der President Leopoldo Fernandez Pujals (who made the remark) has been clobbering competitors in Spain's pizza fast-food market. Pizza Hut, for example, is closing 29 of its Spanish outlets, while Domino's, stuck at 20 outlets, is said to be considering withdrawal from the market. So if Mr. Fernandez, 49, sounds a bit cocky, he has his reasons-especially considering that the Cuban-born founder of TelePizza was ousted from the company in late 1995 by minority shareholders pushing for a sale. But while suitors, including Pizza Hut and Domino's, lined up, Mr. Fernandez rallied the backing of one of Spain's leading banks, Banco Bilbao Vizcaya, and in June returned to the company, which he founded in 1989, to buy out the insurgents. On Mr. Fernandez's homecoming, five new stores were under construction; that number is now over 20. Group sales this year will reach $210 million, up 30% on 1995, when sales jumped 45%. The number of TelePizza outlets will be up 20% by the end of 1996, to 290, of which 40 will be outside Spain (up from 36 in 1995). Growth is especially strong in Portugal, Chile, Poland and Mexico. Three new fast-food chains, which Mr. Fernandez wouldn't comment on except to say that the company is looking at chicken, ribs, sandwiches and Chinese food, are also planned for launch next year, with at least one pilot store set to open by the end of 1996. Some 2 00 outlets for the group-pizza and any new categories-are expected to be added over the next three years. And TelePizza is forecasting higher profit and a 60% market share for this year, while its rivals expect to lose money. Mr. F ernandez characterized his deep involvement in strategy as a "democratic dictatorship." TelePizza invests around 8% of sales annually on marketing, mostly TV, handled by Madrid agency Ruiz Nicoli, and door-to-door couponing.Ads k eep the slogan "The secret's in the dough" in people's minds. Spending in mass media is increasing 50% each year because of more campaigns.The couponing is done in-house because "when you go to war you don't subcontract your army," Mr. Fernandez said. Around 20 million leaflets and coupons are distributed every month nationwide.
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