Business

After buying Plated, Albertsons added the meal kits to stores. What happened to them?

What happened to Albertsons’ Plated meals?

The ready-to-cook meals for two are no longer available in stores.
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The ready-to-cook meals for two are no longer available in stores.

When Albertsons opened its upscale, foodie-focused Broadway Avenue store in Boise last July, shoppers strolling the aisle between the produce section and the burger and pizza counter passed by a long refrigerator case packed with Plated food kits.

That same week, six other Boise stores began selling the kits. Plated provided meat, vegetables, sauces and other ingredients for a dinner for two.

Choices included crunchy chicken Milanese with honey mustard and arugula, roasted chicken au jus with orzo and peas and steak frites with creamy shallot sauce and sautéed spinach. The boxes, which provided servings for two adults, sold for $18.98 each.

Albertsons executives touted Plated’s convenience: Shoppers could pick up a meal kit as a last-minute thought right before dinner and wouldn’t have to subscribe for three to five meals a week as they would when ordering online. And Plated meals could be bought without incurring shipping charges, which added $7.84 to the cost of a two-night plan with two servings each.

But the sizzle has fizzled. At least for now.

The kits weren’t part of the product mix at the Albertsons Market Street store when it opened early last month in Meridian. Plated boxes have disappeared from the Broadway Albertsons and other stores in Boise — and across the nation.

Plated and Albertsons appear to be going back to the drawing board.

“Plated has enjoyed the ability to test and learn on a large scale because of Albertsons Companies’ expansive footprint that covers a wide range of markets and store brands,” Albertsons spokeswoman Chris Wilcox wrote in an email to the Idaho Statesman. “As a result of our testing, we’ll continue to offer Plated in select stores while we temporarily reduce the overall scope of Plated’s retail distribution as we evolve its in-store presence.”

Albertsons struck a celebratory tone when it announced its purchase of New York-based Plated in September 2017. Subscription meal services had popped up around the country, and Albertsons was reported to be the first major grocery company to buy one.

“The punchline for us is that we’re offering another service to our customers that we know they want,” then-CEO Bob Miller told the Statesman at the time.

Albertsons began by stocking Plated kits in 20 Safeway stores in the San Francisco area and 20 Jewel-Osco stores in Chicago. It aimed to expand to as many as 650 stores across various Albertsons Cos. store banners by the end of 2018.

The recent pullback follows the departure of Plated co-founder and former CEO Josh Hix, who stepped down without explanation in January. His cofounder, Nick Taranto, left in October. They cofounded Plated in 2012 and sought investment on TV’s Shark Tank two years later.

A Statesman search of Plated’s store locator found only 19 stores in California’s Bay Area and two Market Street stores in Texas still carrying the kits. They are still available online, however, for delivery to homes in the lower 48 states from five distribution centers across the country.

Plated spokeswoman Liz Marsh said the company plans to eventually expand the availability of Plated kits within Albertsons Cos. stores again.

“We remain committed to growing Plated to serve customers in new and exciting ways,” Marsh wrote in an email.

The meal kit industry, which began in 2012, is booming. The consumer-survey group Nielsen reported that 14.3 million households bought meal kits during the last six months of 2018. That’s 3.8 million more than at the end of 2017.

Meal kits generated $494 million in sales last year in the United States, up 4 percent from the year before. In-store sales totaled $93 million in 2018.

HelloFresh, Sun Basket, Blue Apron, Home Chef and Plated are among the largest of more than 150 companies that sell meal kits nationwide. A year ago, Kroger, the parent of Fred Meyer stores, bought Home Chef.

(While Home Chef meal kits are available at hundreds of Kroger stores nationwide, only one of those stores is in Idaho: a Smith’s Food and Drug in Burley. The kits are sold at Fred Meyer stores in Western Oregon and in Bend, along with Smith’s stores in Utah.)

But meal-kit vendors are struggling amid stiff competition and customer churn, according to Grocery Dive, an industry news site.

Blue Apron sold its food kits in Costco stores last year, but what was described as a pilot program ended later in the year without explanation.

Affluent shoppers make up the largest percentage of meal kit buyers. Twenty-eight percent of in-store kit purchasers earn at least $100,000 a year, Nielsen said. Fifteen percent earn at least $70,000 and 13 percent $50,000 or more.

For online purchasers, it’s even higher: Forty-four percent earn at least $100,000, 19 percent earn at least $70,000 and 13 percent earn $50,000 or more.

Shoppers age 35 to 44 make up the largest group of purchasers, representing 29 percent of online sales and 27 percent of in-store purchases.

A large number of U.S. consumers, 93 million, have not tried a food kit but are interested, according to a report from the NPD group, a market research company based in Port Washington, N.Y.

For now, the Broadway Avenue Albertsons store and the Albertsons Market Street stores are selling store-produced meals with meats and vegetables, such as meatloaf with roasted potatoes and green beans and flank steak with roasted potatoes and beans. They sell for $5.99 each but were on sale this week for $5.

The removal of Plated kits from the Broadway Avenue store was first reported by BoiseDev.com.

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Reporter John Sowell has worked for the Statesman since 2013. He covers business and growth issues. He grew up in Emmett and graduated from the University of Oregon.If you like seeing stories like this, please consider supporting our work with a digital subscription to the Idaho Statesman.
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