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This Popular Grocery Giant Is On a Downward Spiral and Losing Customers

Is this the beginning of the end for a company that kicked off a great mission?

Days may be numbered for a grocery delivery service that captured the hearts of millions of shoppers with the idea of eliminating food waste.

According to Business Insider, Imperfect Foods is showing signs of a breakdown. After a round of mass layoffs this year, as well as several changes in leadership which precipitated a shift in the company ethos, several recently departed employees told the publication that the company seems to have lost its way.

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The company is moving away from the waste-reducing mission that made it popular back in its early days. When it was founded in 2015, Imperfect was selling exclusively produce that didn't fit supermarket standards because of minor flaws in appearance, like discoloration or a weird shape. But in 2019, the company set its sights on the mass market and competing with the likes of Trader Joe's, which may be working against it.

To get there, they started selling other things, like pre-packaged items that weren't saved from being dumped into landfills. Former employees say that these regular groceries were often labeled as "surpluss" on the website, as if to justify their inclusion at Imperfect.

And the mission of only sourcing produce that no one else wanted proved to be a difficult one at a larger scale, so the company's offering was increasingly filled out with regular items.

Another problem the insiders pointed out was that about every one in five orders had an issue. Customers would get items that were broken, damaged, or moldy, or they'd simply be missing, one former corporate employee told Business Insider. "We were not able to deliver a really solid mass-market experience," they said.

Like many grocery chains, Imperfect Foods experienced a pandemic boost in sales and raised millions of dollars through series C and D funding in 2020 and 2021. However, as the pandemic began to wane and shoppers returned to stores, the boost the company was betting on had dissipated, according to the report.

We reached out to Imperfect Foods for comment and will update this article with any responses we receive.

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Mura Dominko
Mura is ETNT's Executive Editor, leading the coverage of America's favorite restaurant chains, grocery stores, and viral food moments. Read more about Mura