Blue Apron’s cash burning and customer hemorrhaging is prompting it to shift strategy.
It will now offer meals kits in grocery stores.
Still, Blue Apron may suffer at the hands of its innate cost disadvantage.
Blue Apron‘s (NYSE:APRN) business model of shipping meal kits to customers’ homes isn’t working. The company is hemorrhaging customers and burning cash, even as it spends a double-digit percentage of revenue on marketing.
The reason for Blue Apron’s problems boils down to price. At $10 per person per meal, the company’s semi-prepped boxes of ingredients cost as much as a meal at a fast-casual restaurant. Aggressive promotions, like offering big discounts on the first box, are getting customers in the door. But those customers, eventually realizing the stratospheric costs, don’t stick around for very long.See the rest of the story at Business Insider
NOW WATCH: Harvard professor Steven Pinker explains the disturbing truth behind Trump’s 2 favorite phrases
15 signs you’re about to get a job offerThis inexpensive TV antenna gets you the most mileage for the moneyJeff Bezos is throwing a monkey wrench into Warren Buffet’s investment strategy
SEE ALSO: Bank stocks surge after the Federal Reserve raises rates