I would hate to be a franchisor in the meal assembly business right now. They have been getting hammered in the press almost weekly across the United States.
Here are articles JUST IN THE PAST WEEK!
- Losing Their Appetite, The Columbus Dispatch (I am quoted in the article)
- Investor Sues Failed Suzanne Somers’ Meal Prep Business, Lexington Hearld Leader
The only bright spot is that pre-assembled carry-out meals seems to be working, which ironically is opposite of the initial premise of the business. Can this pre-assembled model save the industry? Probably not, because most people know that business model simply as a “carry-out restaurant”.
The meal assembly business concept sounds enticing – a fun business with an obvious benefit where professional women socialize as they prepare healthy meals for their households, leaving the mess behind. If you were thinking of getting into this business and asked your friends their opinion, most would say “Yeah, that sounds like a cool business. I’d use it!” But, your friends would be leading you estray. Unfortunately, “good ideas” alone won’t make you money or ensure a sustainable business.
The primary problem with this industry is getting customers in the door and keeping customers coming regularly (like most businesses). Franchisees had everything going against them and stood little chance of succeeding –
- higher rents in high-trafficed streets,
- no initial brand recognition,
- requires change in customer habits,
- requires times and hours on the customers part,
- most need to be educated on the concept and its benefits
- easy concept for franchisors to develop and launch, so competitors came fast
- customers’ brand loyalty is negligible
- most ingredients more expensive “all natural” and “organic”; higher rate of perishables
I hope this industry can work things out, primarily because it does offer a convenient service that can help families be healthy. And healthy, less stressed families are generally happy families.
If I was CEO of one of these companies, I would scale back and only roll out cities with a minimal number of units to leverage advertising. I would hire great PR and advertising firms to get attention and help develop partnerships. I would focus on margins and only offer lower-cost meals that met a certain profit margin.