Social distancing spices up demand for meal kits
A surge in food deliveries during the coronavirus pandemic has reinvigorated the at-home meal kit industry.
Why it matters: Some meal-kit services needed this turnaround. Blue Apron's stock rested at $2 as of March 13 — the same day President Trump declared COVID-19 a national emergency. The company's stock then roared to a high of $16 per share the following week.
- Blue Apron has subsequently hired a wave of temporary staff for its fulfillment centers and limited its menu to expedite deliveries, CNBC reports.
HelloFresh, a Berlin-based meal delivery company, has seen its stock more than double since the U.S. was largely locked down. Its total sales exceeded $450 million in the first quarter.
- The at-home kits have served as an alternative to dining out and in-store grocery shopping.
But, but, but: The spike in demand for food delivery has also brought new competitors to the market. On-demand meal kits have served as a way for dine-in operations to salvage lagging sales with social distancing mandates in place.
- Shake Shack began offering at-home burger sets with eight servings.
- Panera Bread added at-home salad and sandwich kits to its menu.
- Chick-fil-A started offering home chicken dinners with ingredients pre-measured and pre-cooked.
What to watch: The country's gradual reopening has consumers returning to their conventional habits. But momentum and consumer buy-in may give meal-kit services a longer shelf life.
- A potential second wave of COVID-19 continues to overshadow America's ability to return to pre-pandemic living.