Meal prep and delivery services cook up interest

A number of start-ups are aimed at customers who are seeking an alternative to takeout.

Chicago Tribune
December 6, 2014 at 8:00PM
From left, executive chef Max Barajas, owner Jen Moore, and process manager Judy Glass sample various pizzas and dessert pizzas during a food tasting at the Meez Meals headquarters Nov. 13, 2014, in Evanston, Ill. (Armando L. Sanchez/Chicago Tribune/TNS) ORG XMIT: 1160195
From left, chef Max Barajas, owner Jen Moore and process manager Judy Glass sampled items during a tasting at Meez Meals’ office in Evanston, Ill. (The Minnesota Star Tribune)

Start-ups have their eyes on kitchens around the country, aiming to add spice to the often bland routine of making dinner.

Some services offer fully cooked meals. In others, customers receive the ingredients along with a recipe card, chopping, sauteing and aiming to replicate meals like the ones prepared by the celebrity chefs they watch on TV. Some are subscription-based, delivering meals each week, while others allow consumers to buy meals a la carte. Prices vary, often hovering around $10 per serving.

Blue Apron, known as the largest player in the category, started in 2012 and now delivers more than 1 million meals a month, at $9.99 per serving.

Customers "write us love letters … saying things like, 'You've changed my life and you've saved my marriage,' " said founder Matt Salzberg.

With a $50 million round of investments earlier this year, Salzberg said, Blue Apron's unit economics are "really healthy," but it is "spending that money on expanding."

Salzberg envisions Blue Apron, named for the blue aprons chefs wear while learning, becoming the largest name in the country for cooking. In November, Blue Apron said it would launch an online store for cooking gear, on top of its existing delivery system and a line of cookbooks.

More than $545 million has been invested in the U.S. food delivery space since April 2013, according to Rosenheim Advisors, a strategic consulting firm focused on the food-related tech industry.

The target audience for such services includes everyone from individuals and couples looking for an alternative to takeout, to foodie couples with young kids and empty nesters yearning for more interesting meals after years of preparing family-friendly dishes. They compete with grocery stores that have beefed up their prepared food sections with everything from sushi to take-home meal kits that go far beyond a deli counter's traditional fare of fried chicken and macaroni salad.

Grocery operators aren't sitting by, however. The upscale grocer Standard Market, for example, has a "What's for Dinner Tonight?" meal kit for two, with a rotating menu priced under $20 that typically includes a main dish, sides and a dessert, ready to be heated in an oven and served in less than half an hour.

Grocery delivery firm Peapod is also testing the waters. It just partnered with Barilla "to meet the demand for a family-friendly meal kit solution, which did not exist in the marketplace," said Tim Knuettel, Barilla's vice president of sales. The recipes, delivered by Peapod with pre-measured ingredients, cost less than $5 per serving.

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