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Smithfield Foods took its first steps into the meal kit market this week.

The largest pork packer in the U.S. said Monday that it had invested $25 million into Chef’d, a leading meal kit delivery service, giving Smithfield a seat with the company’s board of directors for future product planning and development. It’s a move that reinforces the trend that traditional meat companies are moving into the growing meal kit business, analysts said.

Kenneth Sullivan, Smithfield president and chief executive officer, said this partnership with Chef’d would catapult the meatpacker into a growing market.

In this strategic partnership “we’re able to expand our e-commerce capabilities and reach consumers looking for high-quality, stress-free meals,” Sullivan said in a release.

The investment is beneficial for both parties. In exchange for Smithfield’s national distribution network, Chef’d is able to offer consumer insights and sales data to the meatpacker’s brand portfolio.

Smithfield also acquired Kansas City Sausage Co. on Monday to bolster its packaged meats business and enhance the company’s integrated supply chain. The acquisition comes after a joint venture with Kansas City Sausage in 2013.

Smithfield’s presence in Arkansas includes a meat- packing facility in Bentonville.

Smithfield’s investments this week are signs the company wants to compete and eventually become more like Tyson Foods, said Mervin Jebaraj, interim director of the Center for Business and Economic Research at the University of Arkansas, Fayetteville.

“I’m sure everyone wants to be the biggest and the best,” Jebaraj said. “To do this each company has to maintain market share of what they have.”

Companies also have to look at what their competitors are doing, he said.

Tyson Foods has invested heavily in its prepared foods sector the past several years. This year the Springdalebased company began rolling out its own meal kits, Tyson Tastemakers, to select Wal-Mart, Target and Kroger locations and for purchases online. This summer Amazon filed a trademark application for its own brand of meal kits. The reported tagline: “We do the prep. You be the chef.”

“The meal-kit delivery service is a growing market, it makes sense for protein players to enter that market and capture some of those shares,” Jebaraj said.

Jayson Lusk, head of the Department of Agricultural Economics at Purdue University, saw this as Smithfield trying to capitalize on an emerging area where there is room for demand growth.

“I don’t see this as Smithfield trying to be like Tyson,” Lusk said in an email.

On his blog in May, Lusk wrote that it wouldn’t be long before traditional companies moved into the meal kit business.

“It appears that time has come,” Lusk said.

Print Headline: Pork firm invests $25M in meal kits

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