REDWOOD CITY, Calif.—Makers of meat alternatives are going to war on price, with Impossible Foods slashing its wholesale costs by 15% ahead of big food companies entering the market with their own plant-based patties, the Wall Street Journal reports.
Cargill Inc., Nestlé SA, Smithfield Foods Inc. and Sysco Corp. have all announced plans for their own meatless patties, some at lower price points than Impossible or Beyond Meat—startups that launched the plant-based patty trend. U.S. retail stores sold more than $1 billion in plant-based meats for the 12 months that ended January 25, according to Nielsen. That number is 14% higher than the previous 52 weeks.
Restaurants are scrambling to add meatless “burgers” to their menus, including KFC, Burger King, White Castle and Starbucks. “We’re getting hit up by everybody,” asking us to switch, said Paul Griffin, head of culinary research for BurgerFi International LLC, which has offered a Beyond Meat patty for three years.
But the process to create a meat-like texture and flavor out of non-meat products is expensive. “A lot of people won’t try it unless it’s cost competitive,” said Dennis Woodside, president of Impossible, which is why the company is lowering its wholesale costs. Beyond Meat has no plans to reduce the cost of its meatless burgers, according to CEO Ethan Brown.
At Burger King, the Impossible Whopper costs about a buck more than the Whopper. “Some of the feedback we got back from guests is they felt it was too expensive,” said Jose Cil, CEO of parent company Restaurant Brands. The chain added the Impossible Whopper to its promotional menu, but that hasn’t boosted sales enough for some Burger King franchisees.