Blue Apron revealed yesterday that it’s selling its meal kits in select Costco stores at 30 percent off the normal price.
As of last Saturday (April 28), kits for both beef stir-fry and chicken tacos became available in 17 stores around San Francisco and the Pacific Northwest, and the company is discussing potentially expanding to more stores in the future.
The kits also go for 30 percent less in Costco than they would be available for as part of a subscription service: $24.99, which is about $6.25 per serving, as opposed to the normal $8.75. The Costco kits are also geared towards families and take less time to prepare.
“We’re certainly thinking about different lifestyles, specifically for Costco,” Tim Smith, Blue Apron SVP and manager of consumer products told Business Insider. “I think on the average they will have a few less ingredients” than the subscription boxes, which are “a little bit more complex and really kind of push consumers to learn.”
Blue Apron was one of the first companies to make meal kits a widespread trend in the U.S. The move to Costco is reportedly an attempt to “fight rising competition and woo back customers after operational challenges.”
Said challenges include a 20 percent net revenue decrease from the first quarter a year earlier, laying off 6 percent (about 300 people) of its employees, dwindling shares, and lackluster performance post its IPO.
Meanwhile, a move to the grocery store won’t so much put Blue Apron ahead of the competition as it will let the company keep its head above water, so to speak. Chef’d was the first meal kit company to hit Costco and is currently in over 100 Costco clubs in the Pacific Northwest, San Diego, the Northeast, and Texas, and will launch its kits in Los Angeles stores on May 15. Plated has already moved onto Albertsons shelves, and Walmart sells its own meal kits in stores, too. Even Weight Watchers is onboard with the in-store meal kit.
That’s not to say Blue Apron can’t make an impact once its kits are on store shelves. The company saw its first quarter of growth at the end of March, and shares rose 9.5 percent on Thursday, to $2.30. So it’s not all doom and gloom in terms of company outlook. And while anything’s possible, don’t expect Blue Apron to speed ahead of competitors just because it’s in the brick and mortar. The company may have turned a corner, but the question remains, did it turn in time?
Leave a Reply