Impossible Foods finds a partner

After months of shortages, Impossible Foods is eaming up with a veteran food production company to increase supplies of its popular plant-based burgers.

The Redwood City startup is working with OSI Group, an original supplier to McDonald’s and one of the world’s largest food producers. OSI, based in Aurora, Ill., will immediately begin production of the Impossible Burger at one of its Midwest plants and expand to other facilities soon.

Impossible Foods has been struggling since April to meet demand from customers, including big chains like White Castle and Burger King. During the past two months, it doubled employment at its 68,000-square-foot Oakland plant to 200 people, and it made a record volume of burgers in June. But that still wasn’t enough.

On Wednesday, the company confirmed that it plans to sell the Impossible Burger at grocery stores beginning in September.

Impossible isn’t the only company having trouble meeting the scorching demand for plant-based meat. U.S. sales of meat alternatives have grown an average of 8% per year for the past five years, according to Nielsen. Meat sales were flat in the same time period.

The successful IPO of Beyond Meat, a Southern California plant-based burger and sausage maker, has further stoked the interest of consumers and investors. Beyond Meat’s share price has leapt nearly 700% since its May debut on the Nasdaq exchange.

Beyond Meat dealt with shortages throughout 2017 and 2018. It responded by increasing capacity at its Missouri production facility, but also by working with other firms. In May, it signed an agreement with Zandbergen World’s Finest Meat to produce Beyond Meat products in the Netherlands.

Rebellyous Foods, a Seattle startup that makes plant-based nuggets, has contracted with meat companies...