Dive Brief:

• Albertsons has temporarily pulled Plated meal kits from its Boise, Idaho stores, the company confirmed in an email to Grocery Dive. The retailer will still offer Plated through home delivery in 48 states.
• An Albertsons spokesperson said the company remains committed to growing Plated, and will continue to offer the meal kits in some stores in Northern California and Texas. It is scaling back Plated’s retail footprint in Idaho as it innovates for future expansion of the meal kits with Albertsons.
• "In terms of innovation, it's about exploring the many opportunities within Albertsons Companies to make it easy for customers to create the meal experiences they're looking for," said Liz Marsh, director of public relations for Plated, in an emailed statement. "Currently, dinner is at the core of our offering, so we're looking at everything from snacks and lunches to solutions for special occasions and add-ons such as wine pairings to be available in more ways."

Dive Insight:

It's only been two years since Albertsons acquired Plated for about $200 million, and just last year the company announced it would introduce the meal kits in its stores. The sudden pullback may raise a few questions, although the company has cited innovation as its reason for reducing its footprint. 

One explanation for Albertsons' temporary halt of Plated in Boise could be that the company is planning to use the stores as testing grounds for new innovations. Plated said it wants to expand beyond dinner offerings, which aligns with consumer demands for more choices from its meal kits. Shoppers want shorter meal prep and cooking times, healthier choices, a wide variety of options and limited food waste from their kits.

The meal kit industry has been rocky in recent months. HelloFresh, the biggest meal kit company in the game, announced it plans to break even this year, and all eyes have been on Blue Apron since its stock price hit a historic low of below $1 and its meal kits were pulled from Costco’s shelves. In July, Chef’d abruptly suspended its operations but mounted a comeback in 2019 with True Food Innovations.

While many consumers are eager to try them, a number of meal kit delivery companies have turned to the in-store retail model to boost sales and overcome their struggles.

Traditional retailers are also launching versions of meal kits, including Raley's, Publix and Hy-Vee. Others, including Albertsons with Plated and Kroger with Home Chef, are acquiring meal kit companies. From e-commerce giant Amazon to restaurants such as Chick-fil-A announcing their meal kits, the market is becoming saturated, and companies need to stand out. 

In an interview with CNBC last May, Albertsons revealed that its internal research found that 80% of its customers want meal kits in stores, according to Pat Brown, the chain’s vice president of strategic business initiatives. In-store meal kits provide time-pressed shoppers with convenience, and expanding on its current meal kit solutions could be a way for the retailer to stay up to date on trends as more meal kits hit retailers' shelves.