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Exclusive: Blue Apron's CEO On Management Turnover, COVID-19 Safety, Standing Out Among Meal Kit Rivals

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Meal kit delivery company Blue Apron Holdings, Inc. (NYSE: APRN) has prioritized food safety for a long time, and it was "fairly easy" to communicate this message to consumers when safety issues came to the forefront during the COVID-19 pandemic, Blue Apron CEO Linda Findley Kozlowski told Benzinga in an interview.

Blue Apron's Management Turnover: Blue Apron's C-suite and board structure has undergone a lot of change in the last few years.

Kozlowski was named CEO just over a year ago. In fact, the entire executive team has been replaced since May 2018, according to Grocery Dive.

The most recent departure was announced Thursday afternoon —two days after Kozlowski's phone interview with Benzinga.

Blue Apron CFO Timothy Bensley said he will leave the company at the end of the year and act as an advisor through the first quarter of 2021.

Blue Apron has focused on bringing talent with particular expertise in e-commerce, digital experiences and managing a customer-centric business, Kozlowski said. 

"The company has been through a lot of transition over the years," she told Benzinga. 

Blue Apron has added executives and board members who can help the company drive digital scale and growth, she said. 

Related Link: Exclusive: The Very Good Food Company's CEO On Plant-Based Growth, Why 2021 Is A 'Huge Scale Up Year'

Why Blue Apron Is Safer Than Grocers: One of the biggest advantages Blue Apron boasts over grocers is that 70% of what it sources comes directly from the producer, and the other 30% is just one stepremoved, the CEO said.

In contrast, she said it can never be known how many people previously touched and handled produce that's sitting in the grocery aisle bin.

Blue Apron has U.S. Food and Drug Administration-regulated facilities along with the Safe Quality Food certification.

Blue Apron sources directly from farms that emphasize animal welfare, so it didn't suffer from any supply chain-related issues from temporary shutdowns at meat processing plants at Tyson Foods, Inc. (NYSE: TSN) and elsewhere, Kozlowski said. 

'Adventurousness' In The Kitchen: Consumers may not be as eager to return to restaurants once it is safe to do so, said Blue Apron's CEO.

Internal feedback and external market research show that people are happy and confident cooking in the kitchen, she said. 

In fact, consumers are showing a high degree of "adventurousness" in the kitchen and are eager to learn new cooking techniques to use with some of the more exotic ingredients Blue Apron offers. 

"We are starting to see more and more interest in special occasions and those sort of things, including our premium offering, which is our higher-end, restaurant-quality recipes that people can cook at home," Kozlowski said. 

Competitive Environment For Blue Apron: The meal kit space is growing with new competitors looking to stand out through unique offerings.

Grocery chain Kroger Co (NYSE: KR) is offering its consumers a free code to access NBC Universal's Peacock Premium streaming service as part of its HomeChef meal kit service, as an example. 

Yet these "mainstream" meal delivery kits aren't exciting and offer "common recipes," Kozlowski said.

Blue Apron helps customers "discover new recipes," she said. 

Blue Apron's WW Partnership: Blue Apron and WW International Inc (NASDAQ: WW) teamed up to create a line of meals that are consistent with WW's — formerly Weight Watchers — program.

WW's core message is that people can eat what they want to so long as it falls within its point system.

Blue Apron is able to leverage its already existing healthy lineup of kits to increase its own exposure to WW members, Kozlowski said. 

A partnership with WW also represents a simple extension of Blue Apron's healthier options, she said.

Customization With Blue Apron: The majority of Americans aren't looking to follow any one particular diet and believe in an overall balanced approach to the food they consume, the meal kit CEO said.

To address this reality, Blue Apron continues to work on a recipe customization option where all consumers are accommodated based on their own unique needs or desires, Kozlowski said. 

"Instead of creating really rigid paths for people — give them a lot more flexibility so that they can meet their own specific needs," she said.

In the area of  plant-based meat alternatives, Blue Apron is seeing heightened interest, the CEO said.
Interestingly, a lot of demand exists for products that are a hybrid meat product mixed with a plant-based or vegan alternative, she said. 

Blue Apron started offering Beyond Meat Inc (NASDAQ: BYND) products in 2019 and continues to do so, as Kozlowski said people are "looking for different dietary options."

A Blue Apron meal kit. Courtesy photo. 

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