Whole Foods Preps To Enter Meal Kits

Austin, Texas based Whole Foods Market is set to test an entry in the much buzzed about $1.5 billion meal kit category. They will join numerous small and large competitors including Blue Apron, HelloFresh, and Amazon.

Whole Foods, discussed its plans on a July 27th conference call with investors, offer few details and did not reveal how the service would be branded – private brand?

“It’s part of what we’re looking at with what we call our ‘meal solution spectrum,’ which we’re really excited about because it’s going to address all aspects in which we want to bring food to our customers,” said Ken Meyer, executive vice-president of operations, “We obviously study and see all the trends out there around how that’s changing, and we know that we have a long history of leading in the food culinary side. We’re going to continue that with what we’re doing around looking at the option of meal solutions and the ways in which we want to do that. We’re not going to announce anything today, but we will say that we’re committed to this category. And we think we have a good strategy for it. It will be revealed.”

Leading the effort is Tien Ho, a veteran of the restaurant and hospitality industry, who recently was hired in the newly created role of global vice-president of culinary and hospitality at Whole Foods.

“For the first time in the history of the company (we) have a world-class person from the restaurant hospitality business reporting directly to David (Lannon, executive vice-president of operations) and Ken that’s crafted this roadmap for this group,” said Walter Robb, co-chief executive officer. “We’re going to have a lot to say about this area.”

“There’s a lot more competitors in the marketplace,” said John Mackey, co-CEO “There’s a lot of new formats in the marketplace from home meal replacement through meal kits, fast casual restaurant growth, more entrants in the natural and organic food space, the mainstreaming of natural and organic, which has been well reported. These are all factors. Whole Foods Market being the leader having very high sales per square foot, we probably feel the brunt of it as there’s a bit of a regression to the mean. As we lose customers from a convenience standpoint.

“People don’t drive as far as they used to drive because … there’s good enough alternatives in many cases close by to them. So, people may not be driving as frequently as far as they used to because they can stop by a Kroger or an H-E-B or a Wegman’s to get products that they used to only be able to get at Whole Foods. Now, there’s some overlap in our product base from other competitors. I think there’s no sense in denying it. Competition is bigger, and we’re responding to it as we think in an intelligent measured way, and we still remain very bullish about our future prospects.”

It’s unclear when the meal-kit offering will begin, but the space is rapidly evolving and a delay could prove fatal in evolving category.

Previous articleSears Goes Back-To-School Season With New Private Brand
Next articleSainsbury’s Expands Private Brand in China
Christopher Durham is the president of My Private Brand and the co-founder of The Vertex Awards. He is a strategist, author, consultant and retailer who built brands at Delhaize-owned Food Lion, and lead strategy and brand development for Lowe’s Home Improvement. He has consulted with retailers around the world on their private brand portfolios including: Family Dollar, Petco, Staples, Office Depot, Best Buy, Metro (Canada), TLW (Taiwan) and Hola (Taiwan). Durham has published five definitive books on private brands, including his first book, Fifty2: The My Private Brand Project. In 2017, he will debut his newest book, Vanguard: Vintage Originals, a visual tour of innovation and disruption in private brand going back to the mid-1800’s. Dynamic in his presentation while down to earth and frank in his opinions, he has presented at numerous conferences, including FUSE, The Dieline Conference, Packaging that Sells, Omnishopper and PLMA’a annual trade show in Chicago. Durham lives in Charlotte, NC with his wife, Laraine, and two daughters, Olivia and Sarah.