Is The US Still Hungry For Meal Delivery Services?

Home delivery of freshly prepared meals, meal kits and provisions took off in 2015, with dozens of new ventures kicking into gear, each with its own spin on convenient, healthful food. Get ready for a shakeout in 2016: Too many concepts supported by too little market research have been funded with too much money. It’s a scramble already.

Good Eggs, a farm-to-home grocery-delivery service with $50 million in venture funding, laid off 140 of its 300 employees at the end of the summer, shuttering its service in Los Angeles, New York and New Orleans to focus on San Francisco, where it launched in 2011. Customized food delivery “is really challenging to do right,” says a Good Eggs rep. “We scaled up too quickly, before we were a proven success.”

Still, the opportunity with local food-delivery services is real, say analysts, who believe Americans want healthful, convenient options for dinner. The sector could generate U.S. sales of $3 billion to $5 billion by 2020, according to Bob Goldin, executive vice president of Technomic, a food-industry research firm. “There is room for enterprises that deliver unique values to people.”

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