retail news in context, analysis with attitude

The Wall Street Journal writes that just a few years after a few small disruptive companies introduced the meal kit business, generating hundreds of millions in investment dollars, investors “are losing their appetite for meal kits … many are questioning the viability of meal-kit startups given logistical hurdles, the high cost of attracting and retaining customers and the arrival of often bigger rivals.”

The Journal reports that “an estimated 70% of customers of Blue Apron Holdings Inc., the largest such provider, stop regularly buying its meals six months after signing up, while more than 80% of HelloFresh users weren’t active, according to Daniel McCarthy, an Emory University professor who researches meal kits and other subscription services.”

Such a shakeout, the story says, “was perhaps inevitable, say investors and analysts. In roughly the last five years, 150 new meal-kit companies were founded, some of which catered to increasingly narrow niches, such as Southern-cooking enthusiasts.”
KC's View:
There were just too many meal kit startups to survive, so this isn’t really a surprise. It should be a wake-up call to traditional retailers, which always had all the resources to create the meal kit business on their own, but didn’t see the opportunity. How many other disruptive ideas can be found within the walls of existing stores, just waiting to be exploited by someone with a little imagination?