They are popping up one right after the other, but are meal kits really making money?
Chef’d, one of the first meal kit companies on the market, halted production this week, citing problems with funding. More than 350 employees were laid off Monday at distribution warehouses in New York and California.
As of Tuesday, customers could no longer place orders on the meal-kit service’s website, according to media reports.
As one of the leaders in this space, the move came as a surprise by many.
The Los Angeles-based startup began in April 2015. Last summer, Smithfield Foods Inc., made a $25 million investment in the company, offering access to its distribution network and facilities.
The company also worked with Campbell Soup Co. and Hershey’s Co. to offer the meal kits without a subscription. In total, investors raised $35 million in funding in 2017.
In June, Chef’d announced it would sell its meal kits in 30 Duane Reade and Walgreens locations in New York. The company had also made inroads at retailers, with placements in Gelson’s, Costco, Tops Markets, Food Lion, Hy-Vee and a pilot program with Walgreens, reports The Packer.
At the time, Chef’d planned to be in more than 1,000 retail locations by the end of June.
While meal-kit business as a whole is trending, several companies in the space are failing. Pressure after Amazon’s Whole Foods acquisition seems hard to beat.
Related:
Walmart Adds Prepared Meals; Battles Blue Apron
Beef-based Meal Kits Now Available Nationwide
