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Munchery Shuts Down Operations in LA, New York and Seattle
- Eridrus 9y agoThat sucks, I liked Munchery quite a bit. Their ready to heat meals were pretty tasty, especially for something you could just pull out of the fridge and have ready in 15 minutes.
- adamredwoods 9y agoWe liked it, too, especially because we're working parents. Their delivery was excellent, timely, and let you know if they were late.
- jonathanjaeger 9y agoI'm not surprised -- I bet more will fall. Blue Apron dominates the ad space (I struggle to understand how the unit economics work out with their podcast ad spend..), but I'm a fan of their service and started it a few weeks back. I know not all meal kit services or pre-prepared services are identical in structure, but just acquiring customers that can be very fickle must be insanely difficult with a low margin business like food delivery.
- berberous 9y agoThey also give out huge coupons to acquire new users. I think they gave me a free box ($60 value?) to try it, which I did, and cancelled after a few of them. Then they keep trying to win me back with $20-40 coupons. I bet I could keep trying it, cancelling, and having them entice me back with new coupons forever.
- asdsa5325 9y agoBlue Apron is burning money like crazy, investors are just propping it up.
- paulcole 9y agoDown 75% in less than year. Looks like time is running short.
- twblalock 9y agoPlus they have no moat. If Amazon decided to compete in that space, they could have a service up and running in less than a year that would destroy Blue Apron and similar companies.
- hayksaakian 9y agoAmazon is already running a restaurant food delivery pilot in Seattle, and they already have amazon fresh plus whole foods in stock. All the "hard" infrastructure is in place, the last thing left for amazon is to create the app/website and market it.
- SeeDave 9y agoAmazon already offers subscription-less premium mealkits via a partnership with Martha Stewart/Marley Spoon [1] and more affordable options via their Tyson Tastemakers partnership [2]. [1] https://www.amazon.com/b?ie=UTF8&node=14828691011 https://www.amazon.com/b?ie=UTF8&node=14828691011 [2] https://www.amazon.com/b?ie=UTF8&node=16207550011 https://www.amazon.com/b?ie=UTF8&node=16207550011
- elgenie 9y agoIt might be more like a couple months. Amazon is a logistics company that nails delivery in volumes Blue Apron cannot even fathom and Whole Foods adds pipelines for ingredient acquisition and physical locations in exactly the places where Blue Apron clients live.
- SteveJS 9y agoI really like sun basket, and it seems to me it’s solving a simpler logistics problem with a higher value proposition then munchery. Logistically it’s not on demand, but rather delivery with reasonable advanced notice. For me the value proposition is very high quality meals and a forcing function to do something mindful in making them ... typically my wife and I make them together. This is helped tremendously by the fact I work from home. I do hope the market is there to keep sun basket going.
- abritinthebay 9y agoGobble is hands down the best in the space afaik. Way better than Blue Apron (and faster too) tho Sun Basket is pretty solid. Blue Apron is not bad tho
- aaronbrethorst 9y ago"That's right, Jon. They're shortrib burgers with a hoppy cheddar sauce on a pretzel bun." What I will miss most about Blue Apron after they go out of business are their Pod Save America ads.
- jppope 9y agoMunchery was not a good company. Check out Sunbasket and green chef if you were using Munchery. (just a fan... no affiliation)
- seattle_spring 9y agoCan you explain why Munchery is "a bad company," And why those other 2 are better?
- wolco 9y agoFrom my translation they make a food product the parent doesn't like as much as the food products and/or service at the other two companies. Does that make them a bad company? Depends if you believe the products are a/the represention of the company. For some that and ads are the only window into the company.
- jppope 9y agoHere's some stuff from a google search to substantiate claims on my preferred food services: [Buzzfeed](https://www.buzzfeed.com/hannahloewentheil/meal-kit-subcription-boxes-review https://www.buzzfeed.com/hannahloewentheil/meal-kit-subcript...) [pcmag.com](https://www.pcmag.com/roundup/353192/the-best-meal-kit-delivery-services https://www.pcmag.com/roundup/353192/the-best-meal-kit-deliv...) [reviewed.com](http://cooking.reviewed.com/best-right-now/the-best-meal-kit-delivery-services http://cooking.reviewed.com/best-right-now/the-best-meal-kit...) [time.com](http://time.com/money/4856342/best-meal-kits-value/ http://time.com/money/4856342/best-meal-kits-value/) Regarding opinions about Muchery... it's an opinion.
- ransom1538 9y agoYou make food (a competitive, capital intensive, low margin endeavor - all with rotting inventory) then you deliver it (a man hour intensive, operational & insurance nightmare). AND after you do all this, the person looks at their meal and shrugs their shoulders wondering if it was worth the $10. I am not saying Munchery was bad it was just swimming upstream.
- FullyFunctional 9y agoYMMV, but my family relies heavily on Munchery and it's one of those "Silicon Valley" inventions that has made our life better. Generally the food is good and healthy and avoids a lot of waste (time and material). It's all about logistics and I hope they come through the difficult time.
- deleted 9y ago[deleted]
- x0x0 9y agoMunchery cost a lot more than $10. Even 24 months ago when we started buying from them, it was a $10-ish monthly subscription and two meals turned into about $30 delivered. Now it's closer to $40. We've ordered (I just checked!) 170 times. Pretty much twice a week since mid 2016. They deliver pretty good, pretty healthy food that is worlds better than anything frozen that is ready to eat with 5-ish minutes of effort. It's awesome for two working adults.
- ggg9990 9y agoThis entire space will eventually be dominated by Costco for pickup and Amazon for delivered.
- jdavis703 9y agoWhy do you think Costco won't start doing deliveries? Amazon can target urban, suburban and rural customers. Costco -- with their current model -- only really gets suburban customers.
- ggg9990 9y agoI think Amazon’s investment in delivery infrastructure will eventually outcompete everyone.
- mindfulplay 9y agoCostco already does amazing delivery. Their app and website sucks majorly but the delivery is above and beyond Amazon.
- astura 9y agoCostco needs to expand if they want to dominate anything, I've lived in the different cities and haven't had a Costco within 100 miles in all three.
- ggg9990 9y agoFor sure - it's just that they do have a great presence in this category already. Ready-to-cook meals that are in an aluminum tray and only need to be shoved in the oven for 20 minutes.
- listenallyall 9y agoThe article mentions "on-demand food delivery" at least twice. What other kind of food delivery is there? Is there a startup that will bring you food while you're asleep, or after you just finished eating?
- mynameisvlad 9y agoScheduled food delivery, at a specific time weekly, usually you get multiple days' worth of food at a time.
- vermontdevil 9y agoKroger is offering these meal kits now. The bonus is no subscription. You go to the nearest one and buy what you like. I’m sure other large grocery chains are doing the same thing.
- busterarm 9y agoPublix is as well. My 75 year old mother saw them in the store by mere chance and now she's a steady customer.
- toomuchtodo 9y agoPublix is a Floridian treasure.
- josephpmay 9y agoPublix is a national treasure only available in Florida (and a few other states) :)
- busterarm 9y agoSouth Carolina! :D
- fluxic 9y agoA great in-depth look at the shaky unit economics of the food delivery business model: The Food Delivery Death Star https://medium.com/@review/the-food-delivery-death-star-85f9a121313 https://medium.com/@review/the-food-delivery-death-star-85f9...
- crsv 9y agoTheir CEO did an interesting interview a while back on This Week In Startups. As I recall he seemed to reflect this serene confidence in their ability to scale and had a keen eye for the unit economics... but that being said the service just didn't make a lot of sense. I feel like the target demographic is what actually didn't scale, and the brute force of the sanity check of people getting ready made food delivered for 12-15 bucks a meal was something that didn't resonate outside an minority of the upper middle class.
- x0x0 9y agoMunchery costs a $10-ish monthly subscription and then 2 meals costs you about $35-$38 delivered. We're nothing like upper middle class, and we eat munchery twice a week. It's only a bit more expensive than pizza around here, and way way better. And much healthier.
- ulfw 9y agoSad to say but that is what happens when you’re in the Silicon Valley bubble solving nothing but SF/SV problems. It would be great if more startups start across the US and the globe trying to solve problem the majority of people face rather than a small group of locals.
- mindfulplay 9y agoAmazing concept: where you allow the general public to benefit from investor money. Let's enjoy these dirt cheap services while they burn through investor money. It certainly won't last long. But it's great while it lasts. I enjoy my share of door dash delivery that's funded by some nice investors. /s I almost certainly won't use it when they start charging any sort of real money. Now scale this thinking to millions of people and you have a nice little disaster.
- rkho 9y agoI went to make an order from a restaurant that was about a ten minute drive from my house. On a $45 cart, I was hit with: ~$8 "service fee" $8 "delivery fee" And a variable tip percentage that defaulted to ~$9 Add tax to the matter and this "$45" order quickly ballooned into almost $75. I don't mind tipping -- I've come to accept that American society refuses to let that one go -- but at these rates I decided to just place the order myself on the phone with the place, drive over, pick it up, and tip the restaurant directly.
- timcederman 9y agoAnd there's often also the hidden upcharge on menu prices.
- rkho 9y agoExactly. Some services will add a variable percentage increase to all menu prices. It also turns out the quoted cart that Doordash gave me was $10 below actual cost at the restaurant, and from past experiences on other platforms I'm under the impression that Doordash would not have been willing to eat the miscalculation either.
- tzs 9y agoPizza delivery seems to be doing fine, and has been doing fine for a long time, from the largest cities all the way down to small towns. What is it about the pizza business that lets it thrive with delivery, while so many of these food delivery startups struggle?
- fluxic 9y ago-pizza keeps well in a car (fries/buns get soggy) -pizza is still good when it's merely warm (whereas pasta/chicken aren't) -pizza doesn't come in individual servings (you don't order $2.50 slices. pizza delivery has effective $10+ order minimums) -margins on pizza are huge (it's literally just a cheese sandwich. the cost of a large domino's pizza is <$2.50 iirc; margins on fancier food are not as high)
- mayniac 9y agoWhat I've heard from friends who've worked in pizza delivery places, as well as making it from scratch myself on occasion, the margins are insanely high. Which makes sense considering it was originally a peasant food. Pizza dough is just flour. yeast and water. All of which cost pennies. Sauce is slightly more expensive, but you can make something which tastes pretty close to fresh with some canned tomatoes and spices which also cost pennies. Cheese is cheap, there's no need to use fresh expensive mozzarella when you're blasting it in the oven anyway, the low quality pre-grated stuff will turn out pretty good too. Toppings are usually fairly low quality, which again doesn't really matter when they're scattered on a pizza. When I make it at home it usually costs me about £3, and that's indulging myself with better quality ingredients like fresh mozzarella and tomatoes. Delivery places can get it down to £1, including toppings, and sell it on for £10. The staff are all on minimum wage, you don't need much space if you don't have seating, and at least where I live in London 9/10 delivery drivers use mopeds which are cheap to run. Compare that to Munchery, where looking at the site they're offering fresh vegetables and cuts of meat for probably similar prices to pizza and you can see where the problem lies. That and being based in SF I have no doubt they've gone full Silicon Valley with their offices (communal spaces, very high sq/ft per employee, high wages etc) and it becomes clear why their business model is probably not sustainable.
- azinman2 9y agoSeems like Silicon Valley is learning that “restaurants” are hard, and thinking of things in terms of “software” and “optimization” doesn’t allow VC money to magically solve the fundamental problems. All are struggling except postmates which doesn’t carry any of the real burden themselves. They just need to make logistics and delivery cheap enough, often enough.
- moonka 9y agoI used to use it quite a bit when they launched in Seattle, but we stopped as the menu started to feel very repetitive, and with the price increases we could order form a variety of other places for the same price. Oddly enough, there is a farewell item available for delivery Monday for $100. Wonder if it's an actual item.