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Grocery Stores Jumping Into Meal Kit Market

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Your mission? Make a delicious home-cooked meal for dinner. Here are your options: Walk around your massive local grocery store picking up each ingredient piece by piece, or walk into the store, grab a box full of pre-selected, pre-proportioned ingredients and walk out. Which would you choose? Grocery stores around the country are hoping it’s a variation of the latter, as they gear up to compete with online meal kit services. 

For years, supermarkets have offered their own version of a meal kit in the way of displays that match complimentary items together. You’ve probably purchased one without even knowing it: That display with pasta, bread, marinara sauce, and parmesan cheese? Yup, it’s a meal kit, in a sense.

But the rise of meal kit companies like Blue Apron, Hello Fresh, and others that send fresh, pre-proportioned ingredients to customers’ homes has caused some grocery chains to rethink their in-store meal displays.

“Grocery stores see this as a threat, and they’re going to find ways to fight back,” analyst Mike Vu tells CNBC.

Wading Into Meal Kits

To that end, some chains are already revamping their in-store displays into fresh meal kit-esque exhibits.

Whole Foods, for instance, has created displays that feature a recipe and all the raw ingredients needed to make the meal.

The new meal kit-like option is currently being tested at select stores. A rep for Whole Foods tells CNBC that the company is always looking for new and innovative meal solutions for customers.

Kroger, on the other hand, offers customers the option of picking up an actual meal kit, complete with pre-measured ingredients.

The kits, which cost between $7 and $18 depending on the number of servings, are currently only available in select Cincinnati stores.

The chain notes that while customers still have to come to the store to get their box, they can do so whenever they wish, with no subscription required.

The Pros and Cons

While grocery chains are probably the best-situated of any industry to experiment with meal kits — they have a variety of food at their disposal, after all — there are a few drawbacks.

For instance, customers seem to enjoy the convenience of having meals shipped directly to their home. Additionally, most meal kits come with pre-measured ingredients specific to a recipe, meaning there is less of a chance things will go to waste.

Despite these possible inconveniences, however, CNBC reports that less overhead for grocery chains’ meal kits could be a big draw for potential buyers.

If grocery stores don’t ship kits or package them in boxes and plastic wrap, they’re saving money. This, in turn, could be passed down to customers, who might pay less for their meals.

“The number one reason consumers leave the meal kit industry is price,” Rob Wilson, managing director and partner at L.E.K Consulting, tells CNBC. “Convenience and packaging and other things are up there, but it’s price.”

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