Blue Apron adding shipping fees to orders starting Aug. 30
By Matt Collins Article may include affiliate links
Meal kit service Blue Apron has announced it’s adding a flat shipping rate to all of its orders starting Aug. 30, 2021.
In an email to customers, the company notes: “This past year, we’ve seen costs steadily increase across food, operations, and shipping and delivery” as a key reason behind the move.
The email used the rather timid subject line “We have pricing updates to share with you.”
Starting at the end of August, the company says all of its shipments will be subject to a flat $9.99 shipping fee. This includes meal kits and wine club deliveries, the company says.
The shipping charge will not increase if customers order more meals or the additional “add ons.”
Previously, Blue Apron offered free shipping as long as customers ordered three meals. For smaller orders, a $7.99 fee applied.
Blue Apron says it’s not changing the per meal serving cost, which starts at $9.99, but is instead using the new shipping fee to offset increased food costs. The new pricing structure means customers will essentially be paying the cost of an extra serving for shipping.
Blue Apron defends the change by noting it has been actively increasing its recipe selection and investing in fulfillment equipment and food safety measures at its distribution centers.
“We know that price is a key consideration in your decision to cook with us — and while we can’t control some external factors, we are always looking for ways to bring you value while enhancing your experience,” the email reads.
It appears this change may have been somewhat of a last minute decision — Blue Apron says it’s still working to update its website to reflect the new total on customers’ meal selection pages as of Aug. 17, 2021, when the email notification went out.
The food industry as a whole, including grocery stores, has seen often steep cost increases as labor shortages and supply chain issues mostly related to the coronavirus pandemic proliferated throughout the globe.
Most meal kit companies also often need to use expedited or overnight shipping due to the perishable nature of shipments, which obviously drives up shipping costs. Meal kits also come with ice packs, which are rather heavy and also can increase shipping expenses.
EveryPlate, which has marketed itself as a lower cost meal kit service, does charge $8.99 shipping on each order but its per meal cost is $4.99.
Blue Apron’s parent company went public in 2017 and once traded at over $140 a share but its stock has dipped since then, registering in at about $4 a share in recent weeks. The company is not profitable and lost an estimated $18.5 million in the quarter ending June 2021, according to stock records.
The meal kit industry as a whole was once a hot spot in the market, with investors clamoring on board. However, the companies face fierce competition, thin margins and often struggle to keep customers around long enough to recoup the cost of acquisition.
Plated, an early darling in the industry that appeared on “Shark Tank,” stopped shipping meal kits in 2019. It had been acquired by grocery chain Albertsons for $300 million in 2017. HelloFresh is owned by a German company and operates in various markets around the globe.
Many meal kit companies are heavily advertised online and in other media, including TV.