Will this evolution save the Meal Assembly business?
It was announced in Convenience Store News that Dinner by Design, a meal assembly chain based in Grayslake, Ill., has unveiled a new package of convenience services that the company expects will change the easy meal prep industry.
Specifically, Dinner by Design’s new services include:
- Delivery services that allow people to preorder entrees and side dishes and have them delivered to their company, daycare, school or other organization. Based on a test marketing effort, the company already has more than 300 group delivery clients nationwide. Home delivery will be unveiled and tested in one location in mid-March.
- Pick Up meals for busy people who don’t have delivery service. Take & Bake entrees, desserts and side dishes are premade and can be picked up anytime during expanded business hours. Orders can be placed online, e-mailed, faxed or phoned in.
- Dinner Tonight selections geared for people who need something for dinner without defrosting time. This service helps meet the needs of nearly 37 percent of people who don’t think about dinner until just before preparing it, the company stated.
- Group delivery, Pick Up service and Take & Bake selections are already available and operating successfully at most locations nationwide. Dinner by Design has nearly 60 kitchens open, and agreements for another 40 locations in the U.S. and Canada.
“This is the wave of the future,” president and CEO John Matthews said in a company statement. “This new business model has been very attractive to existing and potential franchise owners alike. We anticipate that the new meal assembly model will mean added growth for Dinner by Design owners and operators.”
It may be a move in the right direction, though I am always concerned when a franchisor introduces a whole new program before the program has received proper testing. I think the move is indicative of the fact that the industry is failing to provide an ROI to franchisees, and is scrambling to come up with a new business model that can deliver profits.
The challenge with this approach is that it may require additional investments by the franchisees to implement. You wonder if that is just like putting more “good money, after bad money”.
Cross Posted at: Let’s Talk Franchising
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There’s nothing new here. Many meal assembly kitchens have been offering these services for years. DbD is just trying to keep their name in the press in a positive fashion at a time when meal assembly kitchens are going out of business everywhere.
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Uh, no too little too late, DbD’s new owners just have more money to throw at marketing.
I also didn’t know that DbD was the be all end all in the Meal Assembly Business.
I think plenty of independent owners have much better success rates & innovative ideas than the franchisors in the industry.
The industry as a whole is on the skids and all the press releases & “new ideas” in the world will not change the fact that there are too many choices that are vying for the piece of the “tummy pie.” It will take a lot more than “come and pick-up a dinner” message.
Folks are still confused and not sold on the MAK business this “announcement” just adds to the confusion of just exactly what a MAK is and does. How does this “new” service make them different from Whole Foods, your local deli or grocery store? The cost to the consumer for this same service is cheaper and more convenient when it is coupled with a trip to the store to buy eggs & milk. Why would anyone want to make an extra stop for dinner that they then have to go home and cook and clean up? As a wise person once pointed out to me “Chinese food take-out containers were genius, you take the food home hot, you eat out of the container and just throw it away when you’re done, no clean-up necessary.”
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Dee Gill writes in the New York Times today that in 2005, meal assembly shops were the hottest trend in small business. But not anymore.
Read the Whole Article: http://www.nytimes.com/2008/02/20/business/businessspecial2/20dinner.html?ex=13
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Jim,
Lets face it, I have lost over $350,000. ok, I will surrvive, however, I want Dream Dinners, Supper Suppers or DbD to STOP selling this failed concept to innocent people. They clearly are selling an emotion, that cost a hell of alot of money.
Please investigate further into this indusrty. Your help & guildance is much appreciated.
Buyers be aware…………….
the sites I visit are mealassemblywatch.com- read the post for misterymiss & tuckerbox they have some great information.
Thank you
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Mike McLean of the Spokane Journal of Business wrote a piece called: Meal-prep chain serves up success, Spokane-based Cena has sold franchise rights for 33 outlets.
It’s an upbeat spin story on the meal-prep chain. Read the whole story: http://www.spokanejournal.com/spokane_id=article&sub=3488
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There are still a lot of franchises that have just recently opened or are on the verge of opening. Many were sold over the past year before the true fallout began.
As with any potential business venture, take a hard - and unemotional - look at the numbers. Not just the numbers that are given to you. Take those with a grain of salt and do your own research. It’s not that hard to see if a place is doing well, sometimes just camping out in the parking lot of existing stores during ‘peak’ times (nights and Saturdays) will give you all the information you need. Be sure to look at stores in saturated markets and at the most mature stores in the system.
If you are even remotely considering this type of business, take a look at mealassemblywatch.com as there are many current and former owners on that board sharing a wealth of experience and information.
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Anyone who writes about Meal Assembly serving up success has not done their homework, send them to those of us who have been duped by this failed franchise concept. There are scores of us who have lost $250,000-$500,000 (including our homes, personal belongings, retirement and college funds) follwoing our dream and the false dreams that have been perpetuated by Franchisors who thought to make a quick buck. Are there success stories in the MAK industry? Yes, but that is the exception not the rule. Franchisors in the MAK industry needs to STOP selling franchises now. Anyone who buys a franchise now or is in the process of buying needs to take a second look and make sure they have the ability to live off of no income for the next 2-5 years and need at least that much in reserve(2-5 years) operating capitol, because they are going to need EVERY penny of it just to survive. This not a business that is a quick money maker and IS NOT for someone who has no culinary experience. You WILL work 60-80 hours a week and do it on a consistent 7 day a week schedule. I encourage everyone who is looking at this concept to do more than talk to the Easy Meal Prep Assoc. or take what your Zor of choice tells you. Please go to http://www.mealassemblywatch.com and read the posts there. Email any of us who have posted their, we will be HAPPY to talk to you about our experience, good or bad.
My opinion? RUN don’t walk away from this failed franchise concept.
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Point by point….
“Delivery services that allow people to preorder entrees and side dishes and have them delivered to their company, daycare, school or other organization. Based on a test marketing effort, the company already has more than 300 group delivery clients nationwide. Home delivery will be unveiled and tested in one location in mid-March.”
My comment, show me some numbers, how can you possibly make up for the time spent marketing to these companies, then creating large batches of meals, and delivering them and still be profitable with this approach? Sorry I don’t see it.
“Pick Up meals for busy people who don’t have delivery service. Take & Bake entrees, desserts and side dishes are premade and can be picked up anytime during expanded business hours. Orders can be placed online, e-mailed, faxed or phoned in.”
My comment, again show me some numbers where this works? Lowering the per ticket revenue, (going from 12 meal average $165-200+ ticket) has NOT helped this industry; it’s one of the major factors contributing to its demise. Not to mention that most large grocery chains already offer these types of services. Meal Assembly kitchens can’t compete in the per item market.
“Dinner Tonight selections geared for people who need something for dinner without defrosting time. This service helps meet the needs of nearly 37 percent of people who don’t think about dinner until just before preparing it, the company stated. “
My comment, this is a market best served by the grocery chains, and restaurants. They have higher volume and it’s easier to add this as an additional revenue stream.
“Group delivery, Pick Up service and Take & Bake selections are already available and operating successfully at most locations nationwide. Dinner by Design has nearly 60 kitchens open, and agreements for another 40 locations in the U.S. and Canada. “
None of the items mentioned in this press release are unique to Dinner by Design, they were not created by Dinner by Design and they don’t in any way help the meal assembly industry. It might sound good on paper, but I really want someone to show that the numbers actually support these ideas.
When are these reporters going to stop quoting the fanciful musings of these so called “industry consultants”? Reporters, do some research! The easy meal prep org makes money off selling “business plans” and getting people to pay to join the association. Doesn’t their record of over stating the market and predicting increased sales lower their credibility?
Anyone that’s actually in the industry has known since early 2006 that the industry is heading down. 2006 was the peak; it’s all down hill from there.
Those of us that actually owned stores and could see how quickly any successful markets were over sold by BOTH franchisors and “independent” consultants selling business plans knew what was coming.
It’s only the franchisors and independent groups selling the idea of the business that have continued to say the market was growing.
At least now they admit that the market is turning, then again they have to or those organizations will look even more detached from reality.
MB
http://www.mealassemblywatch.com/
I also cross posted this same info on http://www.franchisepick.com
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For those who do not understand why consumers may like the concept, let me explain. I’ve used a local Dinner a Fare location a couple times. The benefit to me is the time savings in meal prep (I’m one of the 37% who think about dinner prep about 30 mins before the meail should be served) and the variety. About 3 days a week it’s more convenient to serve one of the pre-made meals than to make something that may be quick but less nutritious. Is it costing me more to do that? Probably, but the time savings and variety is worth it. The store has had a special for a couple months where they will make the meals for me at no additional cost. This is even better as it saves me a Saturday morning. There are several such franchises in my srea, and I hope the one I use survives it.
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A lawsuit has been filed in New York against Dream Dinners by franchisees.
I wish the franchisees a BIG win
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yup, good for the Owners that pulled together- for me, it was too late- I had to close doors, walk away, and in process of filing for bankruptcy.
Just a small plug for joyfilledyou.com After talking with Mindy, you can call her for free, Is a huge encourager for anyone needing that support. She carries a dishpan of my tears around.
Dream Dinners deserves to lose it all. Ego, Greed, Lies & Manipulation is really what this company is made of.
Anyone looking into purchasing a Dream Dinners- RUN!
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Forbes Magazine published an interesting article titled: “Taking On Restaurants And Grocers”, where it discusses the meal assembly business and some of the challenges the business is facing.
Read the article: http://www.forbes.com/entrepreneurs/2008/05/08/franchise-meal-assembly-ent-manage-competition08-cx_ml_0508mealassembly.html
One of the notable comments: “Quick growth does not equal profitability,” says Richard Rosen, a Manhattan-based franchise lawyer who closely follows the meal-assembly industry but does not represent any specific franchise. “This is a fad industry that grew way too fast.”
Jim Coen
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Not only did The Meal Assembly grow too fast, it was an ill-conceived/failed concept from the start, add to that - it lost its relevance for consumers quickly (once the novelty wore off)& once the evolution/adaptation of the “proven” concept/model by Franchisors started happening. Wait-don’t Franchisors keep saying to anyone who will listen there is nothing wrong with the concept it’s the fault of the individual store owners?
That begs the question of “why” the evolution/adaptation of the original concept by Franchisors was needed in the first place.
Consumers have consistently stayed away from Meal Assembly Centers in droves, except for small pockets that are prime for niche market shops.
Meal Assembly Centers ARE NOT recession proof as Stephanie Owner of Dream Dinners says inthe Forbes article. They’re not even a profitable business in a good economy!
With food prices & gas prices at an all time high, wholesale food and packaging prices for the Meal Assembly Center owners have also gone through the roof. Consumers are really watching their pennies closely. On average 19% of their monthly income is now spent on gas to get to and from work.
Meal Assembly Centers have to raise prices to stay in business (not make a profit just to stay in business)…how does that then equate to “saving” consumers money as a new survey put out by a Meal Assembly Assoc. asserts?
The survey says that only 48% of the respondents from 18 volunteer stores across the US & Canada said that a Meal Assembly SAVED them money, while 46% said it HAD NO POSITIVE SAVINGS IMPACT on their grocery bills at all. They responded that their grocery bills remained about the same. (18 stores is a pretty paltry sampling considering that some estimate there are anywhere from 800-1200 stores open in the US).
For Franchisees, raising prices puts them in an even worse postition, at least an independent has some wiggle room before they are forced to raise prices. (the wiggle room is about 6-9%- which would be what franchisees pay out in royalties & advertising funds according to their individual franchise agreement)
Some Meal Assembly Center store owners feel consumers will pay more for the “convenience” of pre-assembled meals from them-and some consumers may, that would have been a perhaps, in a 2007 economy, but not in a 2008 economy-folks are going back to basic eating more meals at home and making them at home with inexpensive pre-packaged alternatives, not buying them from an Meal Assembly Center.
Once consumers realize that the same ingredients that Meals Assembly Centers use, with a mark-up to the consumer of course, are what they the consumer can get at say Costco or their local market for less money, they jump ship.
Also once consumers realize they can make the same meals they get at their local Meal Assembly Centers at home in 15 minutes or less, for less than a cost of an entree available at a Meal Assembly Center, their sales will drop too-and according to some online recipe providers their hits for quick meals has gone up significantly.
ConAgra has seen an increase in it’s frozen entree lines, why? they are quick and inexpensive. Yes, you have to buy sides to complete the frozen meal, but in most cases the same holds true for an entree purchased at a Meal Assembly Center- consumers need figure that in addition to the cost of an entree at a Meal Assembly Center ($25/4-6 servings) you have to increase your purchase price by $6-10 for those sides-now how much money have you saved???(which still have to be prepared at home at a time cost to Mom.)
With frozen, high end and organic entrees available for less money, prepared in less time than what you can get at Meal Assembly Center, why make an extra trip there?
It’s interesting that McDonalds is still posting increases in sales & profits even in a bad economy, why? I think at this point it’s because it still is cheaper and it still is easier to stop at the drive-through with the kids in the back-seat and feed them something you KNOW they will eat…and not whine about when you have spent another 30 minutes preparing it and they end up eating PB&J.
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I enjoyed your Post “onthemove” and know you speak the truth about this concept. I think McDonald’s will always be a big hit with families for the reasons you state and because kids really do seem to prefer the QSF over the home cooked dinners of their Moms or other people’s Moms who prepare healthy meals under franchise arrangements to sell to families.
I think one of the reasons IHOP also has been a very successful franchisor is because it does have a menu and service that caters to families with kids and middle class incomes where the MOM more often than not works a full time job and the youngest kid in the family can get pancakes for dinner and go home happy and not fight the bedtime rules. IHOP doesn’t encroach on its franchisees and maintains its marketshare and will gain marketshare if if can successfully franchise the Applebee’s Concept.
Packaged healthy home-cooked meals sounded like a wonderful concept and was embraced by good people with good intentions but so many have been hurt and destroyed financially by a model of business that “proves” its “proven concept” on the cheap capital and labor of those innocents who really do believe that they are buying a “proven” business of their own.
Carol
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