Total meal kit sales were estimated at $2.2 billion last year, a tiny fraction of the $1.5 trillion food industry.īlue Apron highlights the size of the U.S.
Meal-kit sales grew three times faster than any other channel for food sales between the first quarter of 2015 and the first quarter of 2017. alone. Even with that wealth of options, less than 10% of American consumers have tried a meal-kit delivery service, according to a survey from Nielsen.īut the meal-kit market is growing quickly. There are now more than 150 meal-kit companies in the U.S. HelloFresh brought the business to the United States in 2012 at the same time Blue Apron launched its meal-kit delivery service. The business model originated in Sweden in 2007 and it quickly gained popularity throughout Europe. Meal kits reduce food waste by 62%, according to a 2016 study from sustainability nonprofit BSR that was commissioned by Blue Apron. That can save money and it's better for the environment because less food goes to waste. They also reduce wasted ingredients, such as when you buy a whole bunch of green onions and only use three of them, or when you buy an expensive jar of spice and only use a teaspoon. They take out the time-consuming elements of shopping for groceries and measuring and preparing ingredients. Let's take a deep dive into the meal-kit market, examining the big competitors, the challenges facing the industry, and whether this recent trend presents a good market for investors. Kroger has been moving aggressively in meal kits, establishing its own brand and recently buying Home Chef, the third-largest meal-kit company in the U.S. Established grocers might present a safer way to invest in the meal-kit market. Meanwhile, other large retailers such as Walmart ( WMT 0.70%) and ( AMZN 0.22%) entered the the meal-kit market on their own in 2017.įor investors looking to buy a pure play in meal kits, the only options right now are Blue Apron or shares of HelloFresh on the Frankfurt Stock Exchange (ticker HFG). Several have been snatched up by large grocers like Kroger ( KR 2.49%) and privately owned Albertsons. In the years since, dozens of competitors have cropped up to deliver preportioned ingredients and recipes for ready-to-cook meals to people's doorsteps. Blue Apron ( APRN 3.02%), Plated, and Germany-based HelloFresh helped establish the U.S.
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