A measured approach to meal kits

by Lynn Petrak
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Meal kits
The meal kit market is a $5 billion industry, according to Packaged Facts.
 

KANSAS CITY — Just like meal kits are comprised of a little of this and a little of that, with preparation up to the owner, the success of the meal kit category hinges on the carefully measured, proper combination of ingredients with a careful eye on doing it right.

At the beginning of 2017, subscription meal kits got a lot of buzz. By the end of the year, some of the bloom is off that rose, as delivery companies grapple with subscriber concerns about packaging and contend with value-seeking consumers seeking better deals. As 2018 rolls around, more retailers, including big players like Albertsons, are getting into the meal kit business, leveraging their existing inventory of ingredients, expertise and connection with shoppers to get their piece of the meal kit market.

However the cross-channel category shakes out – with sales at brick and mortar stores, through third-party delivery services, e-commerce on company web sites, carryout from restaurants or, most likely, all of the above – it’s clear that the assembly paradigm is a strong one. The market research firm Packaged Facts pegs the market for meal kits at $5 billion.

Chef'd meal kit
Smithfield Foods and Campbell Soup recently invested in meal kit company Chef'd.
 

Others agree that there is a definite interest in and arguably a need for meal kits in one form or another, due to the preferences and behaviors of today’s shoppers.

“One of the great merchants I know recently said that the grandparents’ generation would make tuna casserole, the parents’ generation would make tuna salad and this generation can barely make a tuna fish sandwich out of a can,” said industry analyst Burt Flickinger, managing partner of Strategic Resource Group.

The dearth of cooking instruction, with an ironic uptick in interest in gourmet foods, is a perfect storm for meal kits, Mr. Flickinger said.

Freshly meal kit
In June, Nestle USA acquired a minority interest in the direct-to-consumer meal delivery company Freshly.
 

Meal kits with animal-based proteins are also appealing to today’s consumers, including younger buyers.

“They love protein, especially high-efficient protein like red meat and poultry,” Mr. Flickinger said, adding that meat and poultry industry campaigns, funded by the respective checkoff and investments, have been impactful in generating interest in using lean proteins in meals that may be easily assembled and prepared.

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