GERMANY – HelloFresh, a German multinational meal kit company, is planning to enter Japan and Italy by the end of the year, as it looks to tap into robust demand across regions.
The Berlin-based company, which delivers pre-portioned meal ingredients with recipes to subscribers, said it planned to bulk up its warehouse network, while exploring the idea of bringing its brands, such as U.S. specialist diet meal kit brand Green Chef, to Germany and other international markets.
HelloFresh, which like its U.S.-based peer Blue Apron and takeaway food groups Delivery Hero and Just Eat Takeaway rode an e-commerce boom brought on by COVID-19 lockdowns, is still seeing strong demand in many countries even as restrictions ease.
The meal-kit firm’s quarterly orders rose 71.2% to 30.98 million, compared with a year earlier, as active customers in its core U.S. market nearly doubled.
The quarterly performance gave HelloFresh confidence that it was on track to deliver 900 million meals in 2021, compared with over 600 million in 2020.
The company backed its preliminary figures and its 2021 outlook for revenue and core profit, which it outlined during its latest earnings call.
When asked if he was worried about increasing competition in the food delivery sector, Chief Executive Dominik Richter said he thought many different food businesses would be able to co-exist, while taking away market share from supermarkets.
In July HelloFresh entered Norway, while it launched HelloFresh Market in the United States, adding ready-to-heat meals and grocery items to its offering.
Delivery Hero heats up competition in Germany
Meanwhile, Delivery Hero is planning to roll out its food and grocery delivery services in more German cities this autumn, heating up competition in the home market it quit three years ago to focus on Asia.
The group founded a decade ago now spans around 50 countries but exited its home city of Berlin in 2018 when CEO Niklas Ostberg sold its German operations to Just Eat Takeaway for US$1.1 billion.
Ostberg announced a Berlin relaunch in May and, with its food delivery and quick commerce markets now up and running in four districts of the capital. The company now plans to launch operations in Frankfurt, Hamburg and Munich will follow this autumn.
“The pace of our expansion will definitely accelerate,” Artur Schreiber, Delivery Hero’s head of German operations, told Reuters in an interview.
Delivery Hero however faces intense competition from a crop of newer, well-funded startups running networks of ‘dark stores’ that can dispatch groceries ordered on a smartphone app to the doorstep within minutes.
Analysts predict a shakeout once the pace of growth slows and Delivery Hero, a constituent of Germany’s DAX blue-chip share index, has built equity stakes in a number of its peers in a move that could herald industry consolidation.
For instance, the company has recently acquired a 5.09% stake in British-based online food delivery company Deliveroo.
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