Dive Brief:

• HelloFresh plans to open its largest distribution facility yet — a nearly 440,000 square-foot center in Phoenix, Arizona — in the fourth quarter of 2021, the German meal kit company said in an emailed press release on Thursday.
• The facility, which is in an area with access to major routes and "a strong labor pool," will boost HelloFresh's West Coast presence, the company said.
• The moves come as the German meal kit company tries to retain customers it gained during the pandemic long-term and scale its business globally.

Dive Insight:

The upcoming Arizona facility joins the meal kit firm's list of new warehouses to grow its U.S. base.

Earlier this year, HelloFresh opened a 127,055 square-foot distribution center in New Jersey to produce and distribute its value-oriented EveryPlate brand. The company also recently opened new facilities in Georgia and Texas.

The Arizona location is close to Interstates 8, 10 and 17, allowing quick access to consumers in population centers. It's "an easy commute [for] the thousands of people who live in southwest and west Phoenix," Christine Mackay, director of the Phoenix Community and Economic Development, said in a statement. That enables HelloFresh access to labor at a time when the warehouse employment market is tight.

Expanding supply chain and production facilities also allows HelloFresh to add more meal options, which can retain and attract new customers in the crowded meal kit space. Competitors Blue Apron and Freshly have also recently focused on adding meal variety.

HelloFresh continues to grow in the U.S., where it saw more than half of its active customers and number of orders during its first quarter. The company saw its active U.S. customers grow by 1 million during its latest quarter compared to the previous one, and U.S. sales increased 37% during the same period.

In addition to the new distribution center in Phoenix, HelloFresh also plans to venture into lunch and breakfast.