ALEXANDRIA, Va. – A new story in Forbes magazine is sounding the death knell for meal kits, those boxes of prepackaged ingredients that allow consumers to whip up dinner in, supposedly, record time.
Research firm Packaged Facts reports that the U.S. meal kit market tallied sales of $2.6 billion in 2017 and will hit an estimated $3.1 billion in sales this year. The firm estimates that the meal-kit market will grow by double-digits over the next several years only to decline to low single-digit growth by 2023.
"The meal kit market is highly dynamic and prone to fluctuations, with the top meal kit providers falling in and out of favor since their introduction in the past few years," said David Sprinkle, research director for Packaged Facts.
Meanwhile, Amazon is investing heavily in its grocery strategy, which is driven by Whole Foods, AmazonFresh, AmazonGo and Prime. Amazon has expanded the availability of meal kits sold under different brands across its grocery chain but has made no effort to become a leader in meal kits. HelloFresh remains the nation’s meal-kit mogul with about 33% of U.S. market share.
Packaged Facts also noted that as more grocery stores offer meal kits as a product instead of as a service, the market will stabilize and become like other convenience grocery items that sell for a premium, such as precut, ready-to-eat fresh produce.
Only 9% of consumers have purchased a meal kit, according to Nielsen, the consumer research organization, noting that’s a low number in an industry with sales in excess of $641 billion last year.
Meal kits are more time consuming than they appear, and the taste of the meals can vary greatly. Some observers believe that aside from a small percentage of consumers that truly enjoy cooking, many have grown tired of mixing and cooking ingredients. The next version of the meal kit will require no preparation and little to no cooking. Just heat and eat.