Coles ramps up prepared meals with Youfoodz deal

Sue Mitchell

Jun 22, 2020

AFR

Coles is preparing for a post-pandemic pick-up in demand for convenience foods and prepared meals by entering into a long term supply deal with family-owned food company Youfoodz.

Coles is expanding its range of prepared meals, stocking Youfoodz in about 820 supermarkets. 

After testing Youfoodz prepared meals in 20 and then 100 stores over the last year, Coles has started stocking a range of about 14 Youfoodz meals such as Thai red chicken curry, Korean BBQ beef and slow-cooked lamb shanks in 820 Coles supermarkets and some Coles Express sites.

It’s a major coup for the company, which is controlled by the Giles family and had annual sales of $200 million last year. It employs about 1000 staff at three food and beverage facilities in Brisbane.

Youfoodz has a thriving home delivery business with a database of almost 1 million customers and also sells prepared meals in about 3000 stores including IGA, BP, Ampol and Nightowl. The deal with Coles will boost the number of stores selling Youfoodz products to almost 4000 and lift Youfoodz volumes by about 45,000 meals a week.

“Our aspiration is to make Youfoodz food as accessible as we possibly can,” said founder and chief executive Lance Giles.

“With [820] stores we’re really confident this will see a really strong uplift in revenue across our entire network,” he said.

Youfoodz’ home delivery sales have risen about 30 per cent during the pandemic, peaking during the panic hoarding phase in March, and the company augmented its prepared meal orders with boxes of fruit and vegetables and grocery staples.

However, demand for convenience foods in supermarkets has been flat during the pandemic, as people working from home have more time to prepare meals from scratch, while sales in petrol and convenience stores have fallen because there are fewer people on the road.

Demand is expected to ramp up when people start returning to their normal routines.

Coles and Woolworths have been expanding their range of prepared meals to cater to time-poor customers seeking nutritionally balanced heat-and-eat meals.

“Since COVID-19 we have seen a growing demand for Australian restaurant-quality food that won’t break the bank and provides healthier alternatives to fast food,” a Coles spokeswoman said.

“Our customers have told us they’re looking for quick and easy meals for lunch and dinner that are made from quality ingredients.

“Our research also found that one in three customers don’t have the time to cook from scratch and 52 per cent are not interested in cooking more at home, with chopping and cutting regarded as their biggest pain points with meal prep.

“To cater to this increasing demand for restaurant-quality meals at home, we have transformed our ‘Food to Go’ department and launched our biggest ever range of homestyle convenience meals to make life easier for customers.”

As well as its partnership with Youfoodz, Coles has added more than 100 ready to heat-and-eat meals and side dishes under a new brand, Coles Kitchen.

Coles Kitchen meals are made by ready-made chilled food producer Jewel Fine Foods, which was acquired by Coles in March.