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Fresh Food

Chef’d Implosion Stuns Suppliers, Retailers

Lead strategic investor Smithfield pondering options after partner abruptly collapses
Chef’d

Smithfield Foods, the largest strategic investor in the shut-down meal kit company Chef’d and its partner in a line of retail-ready meal kits now available in hundreds of retail stores, said it is “evaluating options” for its future in the retail meal-kit business.

“Smithfield Foods Inc. learned that as of July 16, 2018, Chef’d has ceased all of its operations," Tim Zimmer, chief marketing officer of the Smithfield, Va.-based pork processor, told WGB. "We are currently evaluating all of our options in the meal-kit space and will determine our next steps in the coming weeks."

As previously reported, Chef’d abruptly ceased operations earlier this week, citing funding and other financial issues and leaving the future of its brand and products in considerable doubt. However, sources told WGB the company could draw interest from a buyer, given what is said to be a profitable retail business supported by an efficient processing facility.

The abrupt shutdown also caught some retailers unaware, including Tops Friendly Markets, which expanded the line to 80 stores in April after a successful debut of Chef’d meal kits late last fall.

“The news came as a surprise to us, as the items have been doing well for us in stores,” Tops spokesperson Kathy Romanowski said. The Williamsville, N.Y.-based retailer did not have information this week about how, if at all, its supplies would be replenished or how the items would be replaced in stores, Romanowski said.

Sources say the meal-kit industry is poised for rapid growth as consumers seek easier-to-prepare meals at home and look to reduce food waste. But multiple players have struggled to make financial sense of the concept, facing high rates of churn among online buyers and expensive fulfillment costs associated with fresh foods.

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