Meal Kits Migrate into Grocery Stores
As online subscription model falters, meal kit companies are looking to retail distribution and sales for help.
May 06, 2019
WASHINGTON, D.C. – If you haven’t seen meal kits in your local grocery store yet, you might soon. Meal kits, which started as a direct-to-consumer subscription service, are making a massive shift to grocery stores, says CO, a publication of the U.S. Chamber of Commerce.
The niche industry has been struggling online, especially as millennials don’t want to be “boxed” into a subscription or commitment. But in the grocery store, sales are rising: A March 2019 Nielsen report found that grocery stores and other retail outlets rang up $93 million in meal kit sales in 2018, and 2.2 million new U.S. households purchased meal kits in 2018, up 51% from 2017.
“One big thing retail grocery has going for it is real estate,” said Shelley Balanko, senior vice president at The Hartman Group. “It’s so convenient for consumers to pick up a meal kit along with everything else they need at the store …There’s no waiting for delivery, no having to subscribe to a service.”
These companies are responding to a generational trend. In its “Foodways of the Younger Generations” study, The Hartman Group found that 71% of millennials would prefer a home-cooked meal over any other option. Not to mention, convenience and ease is everything these days.
Kroger and Albertsons have already acquired subscription meal kit companies with Home Chef and Plated respectively. Walgreens is even offering Hello Fresh meal kits in select locations.
