How To Start A Meal Prep Business?
Subscription-based meal kit services have experienced significant growth. In the United States, 17% of adults aged 25-44 use Meal kit delivery services. This opens a lucrative business opportunity for all those with an entrepreneurial mindset.
Here are numbers for those interested in the fresh-food meal kits delivery business.
- The Market Analysis Report predicts that the global meal kit delivery services market will grow at a CAGR (compound annual growth rate) of 17.4% between 2022 and 2030, expanding from its 2021 valuation of USD 15.21 billion.
- Meal kit delivery services generated 63.2% of their total revenue from online sales in 2021. The offline platform is forecasted to experience a CAGR of 17.8 percent growth in the meal kit delivery services market from 2022 to 2030.
People prefer home-cooked meals but need more time to shop for fresh ingredients. In this case, hiring a service that sends groceries and meal plans is more convenient for them.
Let Your Meal Prep Business Meet Its True Potential
What is a Meal Kit Delivery Service?
Companies now provide subscription services for meal kit delivery, sending customers a small box containing partially cooked food, pre-prepped ingredients, and pre-portioned ingredients labeled with a recipe card. You can acquire raw materials, such as fruit and vegetable pieces, to cook a hot meal.
Ordering meal kits from a meal prep business online is the way to go if you want to save time in the kitchen and still eat healthy, delicious, and hot food. Young consumers who work away from home often choose meal kit delivery to enjoy the convenience and quality of home-cooked meals. Instead of going to the supermarket, they order meal kits online from a food prep service.
How Does the Meal Prep Business Model Work?
Meal kit delivery services typically use subscription models. They deliver meal kits and recipe cards to the door regularly in exchange for a weekly, monthly, or annual subscription fee. The customer will decide whether or not to purchase the meal, its quantity and size, but the shopkeeper will set the weekly menu.
For example, consider HelloFresh's business model.
HelloFresh charges a $7.49 shipping fee for meal kit delivery. You can purchase a year of five weekly recipes for two people for $89.90.
They entice potential new buyers by providing discounts. The HelloFresh website offers a $22.01 discount to first-time visitors. After applying the discount, delivering five meals per week for two people will cost $67.89.
HelloFresh offers four types of weekly menus:
- Meal and Veggies
- Veggies
- Family and Friends
- Low Calories Menus
The company switches up the meals on the menu weekly to keep customers returning. They will send you new meals every week so the customer always has something new to look forward to.
The best part is that users can cancel your weekly subscription to skip a week of deliveries without any penalty.
Keeping this in mind, let's analyze some steps to launch your meal-kit delivery business.
Why Are Meal Prep Delivery Apps Popular?
Consumers believe self-cooking is healthier than ordering fully prepared meals from restaurants, which may contain unhealthy oil, adulterated ingredients, or unsafe substances. People see meal prep kits as a convenient and healthy alternative to traditional grocery shopping.
This section will examine the most important factors that contributed to the popularity of meal prep delivery apps.
Alternative for Grocery Shopping: Busy people like students and working adults who don't have time to go grocery shopping find meal-prep delivery services convenient. On the other hand, meal kit delivery apps deliver ingredients to the doorstep.
Time-Saving: Meal prep deliveries plan and pack ingredients in advance, allowing users to spend less time in the kitchen and cleaning up.
Easy to Clean: Some kits peel and chop vegetables beforehand, which clears up counter space. Users can recycle or throw away delivery packaging boxes after use, saving time and effort in dishwashing.
Reduction in Food Waste: The meal-prep industry wastes less food than the restaurant and catering sectors.
Gourmet Food: Exotic foods can be difficult and expensive, even in some major cities. When preparing unusual cuisines, people prefer cooking for themselves rather than ordering in. Delivering gourmet food to people's homes using this method is cost-effective.
Benefits of Meal Kit Delivery Business
A meal prep company offers many advantages. Below, we describe some advantages of starting a meal prep delivery business.
Marketers can effectively target a narrow audience by using meal kits. For instance, if your business sells nutritious food, you could offer something special to your target market.
Successfully marketing and delivering your meal kit products can add up to time and money saved from not having to cook every day or week.
Prepackaged containers will package most of your ingredients, making them ready to consume straight from the box and saving you time and money on preparation.
Meal kit companies offer consumers convenient, pre-portioned kits of their favorite foods, allowing them to eat healthily without feeling deprived.
Major Online Meal-Kit Service Providers
- Hello Fresh: Hello Fresh delivers to the United States, Canada, Australia, the United Kingdom, and France. It is a European company.
- Blue Apron: Blue Apron rapidly expanded across the United States as a meal-kit delivery service headquartered in New York City.
- Plated: Plated, another New York City startup, gains popularity due to its flexible meal orders.
- Forage: Forage operates a food delivery service in only two states: California and Nevada.
- Peach Dish: Peach Dish focuses on serving customers in the South but offers nationwide delivery, taking its cues from the cuisines of the American South.
- Hello Chef: Hello Chef, a meal-kit delivery service based in Dubai, is growing in the city.
- Sun Basket: Sun Basket, a major player in the local market on the west coast of the United States, is headquartered in San Francisco.
Revenue Model: Money for Convenience
The meal prep service costs customers more than if they prepare meals and shop for groceries independently. Meal kit delivery services charge customers for convenience and impart culinary know-how while generating income.
In addition to the primary revenue channel, the following gateways can supplement the cost of the meal kit:
Hosting banner ads: Sign up for a banner hosting service like Google AdSense.
Affiliate marketing: You promote the products of other companies in the food industry on your website through affiliate marketing.
Franchise fee: The platform can charge chefs a franchise fee as its popularity increases for featuring their dishes on the menu.
Selling cookware & merchandise: Selling branded cooking utensils, tools, recipe books, and other merchandise is a mindful and profitable method.
be your own boss and Start A Meal Prep Business Now!
Different Approaches to Building a Meal Prep Delivery App
Learning how to start a meal prep business can be a lot of work, but it can also be a very rewarding experience.Three ways exist to create an app for delivering pre-prepared meals. All three will require consulting with software engineers. Below, we rank methods in terms of money and time spent from least to most efficient.
1. Scratch Development
Software developers use agile or waterfall methodology to develop the meal prep delivery app according to the submitted Software Requirement Specification (SRS) document. Business owners can also hire software developers to aid them in preparing the SRS. The high price and extended development time required for the final product are the main drawbacks of this method.
2. SaaS Solutions
Customize a SaaS solution, which is a pre-built eCommerce platform, to get your meal-prep delivery app up and running. The solution provider may bill them monthly, quarterly, or semiannually depending on the chosen service plan for using their cloud server. The unlimited recurring costs of SaaS solutions make them extremely expensive in the long run, a major drawback. The high transaction fees, low number of transactions allowed, and low number of users allowed in the base package will eventually prompt businesses to switch to a different platform.
3. Readymade Meal Prep Delivery Solutions
Introducing your app for delivering prepared meals through this method is the most cost- and time-effective. Implementing a ready-made solution is simple, and you can pay the price in installments. Many ready-made solutions offer the feature of self-hosting, which allows companies to work with any hosting service provider they like. Entrepreneurs can also host the platform on their servers.
How To Develop a Meal Kit Delivery App Like HelloFresh?
Developing a business model for your food prep services involves the following steps, but the general framework for creating a business model remains the same across industries.
Initial market research: Knowing the market and its operations is part of it. Your industry rivals will become clearer to you.
Selection of Target Market: Once you grasp the market knowledge, you should focus on the specific demographic you intend to serve. You need to decide whether to cater to the same consumers your rivals already serve or reach an entirely new demographic.
The USP Factor: Make a Unique Selling Point (USP) as the next step. Your company's primary selling point will be what sets you apart from the competition.
Approaching an app development company: Contact a reputable app development firm to create a business app. Proceed with extreme caution because target customers will like your business based on the quality of your application. You'll need to sift through the many app development firms in the market to find a good fit for your business.
launch a successful meal prep business and join the ranks of thriving entrepreneurs!
Must-Have Features of a Meal Prep Business App
Here we have listed must-have features of the Meal Prep delivery app.
Backend Management
Order Management: To monitor all incoming orders and delivered orders. The owner can cancel, modify, and update orders and receive and send push notification updates.
Catalog Management: The business owner can add, edit or modify meal listings through the catalog management features in their control.
Analytics: Business owners can utilize analytics options such as weekly, monthly, and quarterly sales analytics, website traffic, clicks, bounce rate, etc., to review sales performance, measure marketing efforts, and develop data-driven strategies to increase sales, enhance customer retention, and achieve other goals.
Multi-User Content Management System (CMS): Mid to big-size businesses require a multi-user content management system (CMS) that allows them to create multiple sub-admin accounts. This is particularly important so the owner can employ a dedicated team of system administrators.
Front-End Management
Meal Categories & Menus: Businesses should display all meal plan options, like Vegan, anti-allergy, gluten-free, and lactose-free meal plans.
The menu option allows customers to peruse the meals for the week quickly.
Cooking Manuals or Videos: The app must provide cooking instructions or a video. Customers must receive recipes or how-to videos from meal preparation services to aid in cooking.
Meal Customizer: Any meal delivery app must have the function to personalize meals. Customers commonly request minor modifications such as additional ingredients, cutlery, and condiments when they order a meal package.
Multiple Payment Gateways: Multiple payment gateway integrations to your meal kit delivery app demonstrate a secure and forward-thinking nature. You can work with more partners in the future if you have access to more payment processors, and each partner can use whichever payment processor they prefer.
Customer Assistance
FAQs: FAQs section aims to answer the most common questions and clear up any confusion visitors may have.
Chat Messenger: A customer may still have questions about placing an order, even after reading the Frequently Asked Questions section. In these situations, having a chat customer service rep available to answer questions, place orders, and issue refunds is invaluable.
Review and Ratings: Encouraging sellers to use the marketplace platform and helping customers make informed decisions about what to eat can be achieved through the ability to rate and upload reviews.
Vendor Profiles: Visiting the vendor's profile, which acts as a virtual storefront, allows customers to find hygiene ratings, food images, reviews, and ratings, as well as the best meals offered by the vendor.
Conclusion
By using the data above to build a solid reputation for their brand, new entrants can get a leg up on the competition and begin making sales. Startups can achieve rapid expansion by confidently launching their meal prep delivery app based on facts and thorough investigation.
FAQs
Is starting a meal-prep business worthwhile?
Meal-kit delivery services around the world are worth more than $10 billion. Consequently, companies offering meal kits are expected to experience a growth in market share. Your company has a chance to succeed financially as a result.
What kind of customer typically uses meal kit services?
Young consumers, such as those in higher education or the workforce, primarily use the meal prep market.
