F&H: In recent years, the meal kit industry has become dynamic and evolving. What do you think is driving the growth of meal kits across the country?
Jamie Shea: Canadians’ increasingly busy lifestyle is what’s driving the industry. We launched meal kits in Canada to give Canadians back their time to focus on what’s important in their everyday life — whether it’s spending time with loved ones or building a career they love. In fact, convenience is a key factor for using meal kits among most subscribers with more than 60 per cent of meal-kit users describing their lives as hectic (NPD 2018 Survey). With more Canadians pursuing full-time jobs, involved in community, sports, and busy social lives, they truly value products that deliver convenience, especially when it’s at an affordable price point. That’s exactly what Chefs Plate does by providing everything you need to cook a great dinner, right to your door. We’ve even lowered our prices to start at $8.99/meal so even more Canadians can enjoy the convenience of meals from Chefs Plate, Canada’s most affordable meal kit.
F&H: What are the most popular meal components being ordered and does this differ across the country by region and/or by gender?
JS: Across the board, our customers tell us that they want to cook delicious meals at home but those meals have to be super easy to prepare and fit into their lifestyle. This has informed advancements in our recipe development and menu planning to ensure our customers love every meal they cook with Chefs Plate. It’s guided us to launch unique meal plans based on customer lifestyles with Classic, Family, Vegetarian, and 15-Minute Options and we have even implemented recipe ratings on our website and app to better inform future menus. Based on these recipe ratings we know for example that our customers love pasta and chicken dishes.
F&H: Is there a certain demographic driving this trend, i.e. Millennials? And is it being purely driven by convenience? See above.
JS: 2018 survey from NPD research group (July 2018) shows that millennials are early adopters of meal kits and they’re becoming increasingly significant in the commercial foodservice space, while we also see that families are a growing demographic. Millennials are a key demographic for Chefs Plate for a few key reasons:
- Studies reinforce that millennials are convenience seeking. Cooking Made Easy for lessis the cornerstone for Chefs Plate and we prioritize simple, easy-to-cook recipes that are convenient for customers to make.
- There were also interesting news stories last year regarding how millennials are killing the canned tuna industry because they don’t own can openers. That underscores their desire for fresh, quality ingredients, which is what Chefs Plate delivers right to customers doorsteps every week.
F&H: Are millennials ordering more vegetarian components? What seems to be the most popular dishes?
JS: Plant-based diets are becoming a major trend in the Canadian food industry at large, but we’ve also seen from our research that the majority of vegetarians are under 35 and our vegetarian menu plan appeals to them because it takes plant-based to the next level. We are establishing a strong customer base with our meatless offerings because the recipes are unique, flavourful and packed with protein.
F&H: What is the typical cost of a meal kit for two people? Is the premise based on a subscription model?
JS: Chefs Plate recipes start at $8.99 a meal. We have prioritized offering affordable pricing relative to other meal kits to make fresh, quality food available to more Canadians and we are able to do so because of our direct relationship with suppliers. We offer new menus to our customers every week and they can either sign up for automatic deliveries or place orders when it suits them best.
F&H: Millennials seem to prefer ordering in as opposed to cooking. Does this impact on the growth of meal kits?
JS: Millennials are increasingly significant to commercial foodservice industry and this is why we are seeing this as a segment of growth. For example, the annual millennial dollar spend on commercial foodservice for Summer 2018 was more than $18 billion — up from more than $13 billion in 2013.
Millennials are visiting and spending more at commercial foodservice, so this is a real opportunity for Chefs Plate, especially with our ease and affordability value propositions relative to the industry. With our meals starting at $8.99, we provide a much more affordable dinner option to millennials than ordering in, while still offering the convenience they are seeking. It’s proven that meal kits are a substitute for restaurant and prepared grocery foods in more than one in two meal occasions.
F&H: Are the sales of meal kits higher in grocery stores or through delivery?
JS: Canadians see huge value in the convenience of receiving a meal kit right to their doors with everything they need to make dinner from the recipe card to the pre-measured ingredients. Our customers tell us that they love having Chefs Plate delivered to their door because it not only saves them time meal prepping, but also allows them to skip the stress of meal planning and grocery shopping.
F&H: What are the challenges of the delivery model and is it sustainable?
JS: We see tremendous potential in the category and have built a business that will continue to grow as we commit ourselves to great customer service and product innovation. We’ve built a rich network of Tier-one suppliers across Canada, invested in state-of-the-art technology and automation, as well as the best culinary talent our country has to offer. The most exciting part is that our direct relationship with suppliers allow us to get food on the table three-to-four-times faster than the traditional grocery supply chain!
F&H: Are meal kits available only for dinner, or for breakfast and/or lunch as well?
JS: We know the Chefs Plate customer is looking for ease and convenience so in addition to our weekly dinner recipes, we added an option that includes Dinner and Lunch in one easy recipe. With a simple tweak, customers can capitalize on their meal-kit prep time and have a great lunch for the next day at a fraction of the price. For example, this week’s menu plan includes Chicken Chili Con Carne for dinner with a slight tweak to prepare a rice bowl for lunch. These are a becoming a hot item on our recipe plans.
F&H: What is the expected growth of the meal-kit market in the next two to three years?
JS: The meal kit Industry in Canada is estimated to reach $300 million this year (NPD Group Survey, July 2018), representing a .5 per cent share of total Commercial Foodservice volume. So, with those kinds of predictions, the sky is the limit in the next couple of years and that’s a big runway for us.
F&H: How do you see this market evolving over the next five years?
JS: Customers are in the driver seat and their demands for convenience, value and recipe innovation will continue to raise the bar in the category. Meal kits, ordering apps and restaurants are all creating a healthy competition that constantly fuel innovation and we’re excited to be at the forefront of inspiring Canadians to cook at home. We’ve already disrupted the grocery category once and continued innovation will be the key for future growth. We are excited for our innovation to focus on delivering ultimate convenience and great meal solutions to customers for years to come.