Waitrose Mindful Chef

Source: Waitrose

Consumers often cycle joylessly through the same few meals and feel trapped in the routine. Meal kits help solve this problem

Meal kits are said to be in good growth. Though sales don’t show up in standard industry measures like scanning and Kantar, there is a buzz in the industry, which prompted Waitrose to recently partner with Mindful Chef. But what are these companies, such as Gousto, HelloFresh and Mindful Chef, really trying to do, and what are the implications?

Consumers express frustration with their main meals. They often cycle joylessly through the same few meals, week in, week out, and feel trapped in the routine. The challenge of thinking up a new meal, buying all the right ingredients, then working out how to cook it on a Tuesday night after a busy day, is normally too much. People revert to the same old stuff.

Meal kits help solve this problem. They offer lots of options, the right amount of each ingredient and good instructions. The customer emerges with a different meal and they feel better about themselves, a step closer to the food life they aspire to – home cooked, interesting and wholesome.

Kit companies are onto something, but there may be more to come. In a podcast with The Food People, Gousto founder Timo Boldt was evangelical about the sustainability of its model, and the potential for further personalisation. He sees a big opportunity in meals as personalised nutrition. HelloFresh was equally bullish at a capital markets presentation in December. It pointed to growth beyond the main meal (lunch, breakfast etc), and the opportunity for up-sell (premium ingredients) and cross-sell (grocery or personal care items alongside the core kits offer).

 

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So kit companies are confident. What does it mean for the rest of the industry? The challenge is significant for the established grocery retailers. They have tried and failed with kits before. Perhaps it is something to do with the selling environment – kits seem expensive framed against keenly priced grocery items. And if retailers want to get anywhere near the breadth that kit companies offer, unpalatable wastage levels are likely.

The best response is to find other ways to meet the same basic need – something more interesting and easy to do for dinner. Tesco has had a go recently with its ‘That’s Dinner Sorted’ recipes. But the solution does not always have to be the whole meal – sometimes the protein and a sauce are enough, with the shopper happy to work out the rest.

What about suppliers? The smart ones are watching meal kits carefully, and not just for the volume and growth they may offer. While kit customers add complexity to a supplier, with the volumes on some meals potentially more of a headache than an opportunity, suppliers may feel they need to be involved, if only to better understand what is happening in this area. If you accept that kits are here to stay, then learning as these companies learn could prove to be important.

So another item in a long to-do list for 2022: keep an eye on meal kits. There may be much more growth to come.

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