With Target officially cutting off ties, Hampton Creek has lost its largest retail customer

Mayo mystery.
Mayo mystery.
Image: AP Photo/Jeff Chiu
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The second-largest general goods retailer in America has cut ties with Silicon Valley’s preeminent food startup.

That means Hampton Creek’s Just Mayo vegan mayonnaise products will no longer be on store shelves at Target, concluding a month-long unraveling in the relationship between the two brands.

It’s another piece of undesirable news for Hampton Creek, which has weathered a summer of tumult. In early June, CEO Josh Tetrick fired three lieutenants after he uncovered a plan to orchestrate a coup. Later that month, his executive board walked out on him. And then there were the food-safety issues raised by the falling-out with Target.

So what happened?

According to Bloomberg, executives at Target had decided to yank Hampton Creek products from all Target store shelves after they received allegations of food-safety concerns. The retailer alerted the US Food and Drug Administration, which began monitoring the situation.

Throughout the ordeal, Hampton Creek maintained its products were safe.

As the company awaited the FDA to clear its name, it hired a third-party investigator to try and better understand what sparked the initial concern. According to the company, that investigation uncovered at least one unsigned letter sent to Target that claimed, among other things, that dangerous pathogens such as Listeria and Salmonella were found at one of the facilities where Hampton Creek products are made. (Target has not confirmed whether that letter exists.)

On August 9, responding to our query about the status of the FDA investigation, an agency spokesman said “the FDA has no significant safety concerns with Hampton Creek at this time.”

Hampton Creek shared that news update with several media outlets and waited for Target to restore its products to store shelves. But Target decided to discontinue its relationship with Hampton Creek anyway, according to a statement:

We used the opportunity to review our portfolio, as we regularly do, and decided to reconsider our relationship with Hampton Creek. We are not planning to bring Hampton Creek products back to Target and have openly communicated our decision with the Hampton Creek team.

The retailer wasn’t specific about why. But Hampton Creek filled in the blanks with a statement of its own, saying, “Target informed us that sharing with the public the FDA’s conclusion that our products are safe violated Target’s vendor communication guidelines causing them ‘dismay.’ Target told us that is what drove their decision to end our relationship.”

What it means

Before it decided to take Hampton Creek products off its shelves, Target clocked in as the brand’s largest customer. Target has about 1,800 stores in the US. (Hampton Creek is sold in about 20,000 stores nationwide.)

For the average consumer who buys Hampton Creek, the news isn’t likely going to mean much. Shoppers will still be able to find the product in many Walmart stores, Whole Foods Markets, and other grocery chains. But investors wary of the company’s run of bad news may approach Hampton Creek with even more skepticism now.