Catch the Meal-Kit Craze

Is there an opportunity for c-stores with ready-made meal kits?
Blue Apron

Blue Apron ships 5 million meals per month.

Ready-to-cook meal kits are all about convenience. At least that’s what Erik Thoresen, principal with Chicago-based Technomic, thought.

But it turns out there’s more to it than that.

According to Technomic’s research, convenience is just one of the reasons behind the growing trend. Health and, interestingly, entertainment value were attractive features that showed up signi­ficantly in consumer surveys.

The trend consists primarily of subscription services in which consumers receive via mail a week’s worth of recipes and ingredients to prepare and enjoy at home. Headliner Blue Apron went from shipping 500,000 to 5 million meals a month in less than two years.

“Preparing a meal is engaging,” Thoresen says. “Consumers view it as an enjoyable experience they can share with their family members.” And shoppers are now more comfortable with the online subscription model than they had been, lowering the barrier of entry.

3 billlion-5 billion

Forecasted growth of the meal-kit market in the next 10 years

Source: Technomic

Although there’s been a lot of experimentation in the meal-kit space in grocery stores—Whole Foods and Peapod among them—Thoresen doesn’t believe there are any major c-stores participating in the market, even indirectly. But it’s not for lack of opportunity, he says.

The benefit to c-stores, Thoresen believes, is location. With some consumers preferring to pick up their meal kits rather than have them delivered, partnerships with meal-kit companies could designate c-stores as pick-up points, with potential upsales on items such as beer and wine. Some kit companies include suggested pairings with their recipes already.

San Francisco-based Handpicked is developing a platform that would allow customers to shop for meal kits online, which retailers then pack for them to pick up. On-demand meal kits, ready for spontaneous purchase, are also a growing opportunity, says Thoresen. Both of these represent potential entry points for c-stores.

As urban professionals dominate the meal-kit market, urban c-stores are particularly well positioned for entry into this space. But Thoresen is con­fident that the meal-kit customer base will expand and diversify and, with it, the possibilities.