Kroger rolling out meal kits in region

Kroger is getting into the meal-kit business in a big way, rolling out the cookat-home option in 200 of its stores by the end of the week.

The news, however, is serving as a big lump of coal in the stockings of online meal-kit operators such as Blue Apron.

The Cincinnati-based grocer has stores from coast to coast. If the new meal kits, which were tested in Cincinnati earlier this year, expand across its system, the Blue Aprons in the marketplace could be in trouble. That’s because of the very reason that meal kits exist: convenience.

“It is clear that there is a great advantage for retailers to offer these products,” said Howard Waxman, an independent market researcher and food writer. “They will, in the long run, come out ahead of the delivery-service companies,” noting that grocers have both size and frequent consumer visits on their side.

Kroger is expanding the meal kits, called Prep+Pared, in several markets, including Columbus and Indianapolis,

but not in every store. Central Ohio is to have about 20 stores carrying the kits by Dec. 15. Stores in Lewis Center, Dublin, Lancaster and Mount Vernon started stocking the kits Wednesday.

Meal kits have exploded from $1.5 billion in sales in the U.S. in 2016 to an estimated $4.6 billion this year, according to an analysis by Packaged Facts, a food-marketing research firm. Sales could top $11 billion within five years.

Those are heady numbers, and almost all of that is outside the $800 billion grocery sector, which has been slow to respond to the growing popularity of meal kits.

Blue Apron, the biggest of

the kit businesses, delivers meals to customers’ homes. The company went public in June, garnering a market value north of $1 billion, but its stock has stumbled since.

There are dozens of other meal-kit delivery services. Columbus even has a few of its own, including Fare and Square, which opened last year.

Kroger is going to eat into that business, if only because people who buy meal kits still shop at grocery stores, Waxman said.

Grocery kits also are likely to undercut the delivery meal kits on price. Kroger’s kits, available in the deli department, cost $14 for two servings, and the food can be ready in about 20 minutes. Blue Apron’s meals start at around $9 per serving.

Kroger is offering seven

meals at launch: pork chili verde, shrimp scampi, carne asada steak, bacon and honey mustard chicken, mushroom stroganoff, chicken enchiladas rojas, and spicy lemongrass pork. The meals will change throughout the year and feature seasonal produce and flavors.

Grocers also have gotten much more savvy about making the shopping experience more convenient. Giant Eagle’s Curbside service has proved popular, as has Kroger’s ClickList. Ordering online or via mobile phone has become easier, and nearly every grocery store is at least testing delivery services.

Consumers also are changing their food-buying habits, which has fueled the mealkit segment and many of the changes at grocers and restaurants, according to the

NPD Group, a market-information company.

As the baby boomers have aged, they are eating out less, according to NPD. They also cook less, turning more to prepared foods and easyto-make meals. Millennials, who now outnumber baby boomers, also are shaping the food landscape through their demand for delivery services, kits and experiences instead of just meals.

Millennials also seem to be inheriting fewer cooking skills than prior generations acquired, Waxman said.

“As long as people are stressed for time and there is a breakdown of passing along cooking skills,” Waxman said, “meal kits will serve a good function.”