After 72 years of delivering meals across the country, Yelloh has decided to close its doors for good on November 22. The company, which began as Schwan’s Home Delivery in 1952 and set up shop in Marshall, Minnesota, cites a series of overwhelming business challenges as the reason for its shutdown, as stated in their recent announcement. As of October 3rd, Yelloh has not yet filed for bankruptcy.
Over the years, Yelloh has been known for its frozen food offerings, delivering meals directly to customers’ homes. This service model helped the company grow a dedicated customer base and employ about 1,100 workers across the nation. However, recent economic conditions, shifts in market dynamics, and changes in consumer behaviors have heavily impacted the business. This is not the only industry hit by bankruptcy woes, as the restaurant industry and home improvement businesses struggle to stay afloat amid rising costs.
Economic and Market Forces Lead to Business Closure
The official statement from Yelloh highlighted several key issues that have affected the company’s operation.
“The current Yelloh team has worked hard against external headwinds such as the nationwide staffing challenges and crushing food supply chain disruption caused by the pandemic,” the company noted. These challenges, alongside evolving consumer lifestyles and mounting competitive pressures, have been accumulating over the past two decades, making it increasingly difficult for Yelloh to sustain its business model.
Digital shopping trends have significantly altered the way consumers interact with service providers. Michael Ziebell, a board member at Yelloh, commented on the shift, saying, “Digital shopping has replaced the personal, at-the-door customer interaction that was the hallmark of the company.” This change signifies a fundamental shift away from the traditional business operations that Yelloh was built upon.
The company has expressed a strong commitment to its employees during this transitional period. “Our concern is now for our employees and caring for them as we all come to terms with the fact that this business – that served millions of families and provided a livelihood for thousands over the decades – has regrettably run its life cycle,” said Ziebell.
Community and Employee Reactions to the Closure
Consumers have also reacted to the news of Yelloh’s closure. Jennifer Heille from Esko, MN, expressed her confusion and disappointment, saying, “I really don’t know why they’re closing down. I think that maybe, with different apps out there, the UberEats and all of that, I think that that might be affecting their business. It’s really sad.”
Becca Thompson, a resident of Cloquet, MN, shared her sentiments with WDIO, recalling her personal experience: “When we built this house, they started coming. I always kind of felt bad. So I always ordered. But the guy was so friendly. So I was so sad whenever they stopped coming.”
In a statement to CBS News, it was reported that 176 employees in Minnesota will be affected by the layoffs, though they will be compensated through November 22.
Bernardo Santana, CEO of Yelloh, offered his thanks to those who supported the company throughout its operations: “It’s with heavy hearts that we made the difficult decision to cease operations of Yelloh. We are thankful to our many loyal customers and hard-working employees for everything they have done to support us. I am deeply grateful for our employees’ tireless and bold efforts and our customers’ dedication.”
