7 Strategies for Owning and Operating a Successful Pet Business
Owning a pet business can be very lucrative. Demand for pets, especially cats and dogs, is expected to rise – driven by single-person households, millennials and the aging population. This opens up a wide range of opportunities for pet entrepreneurs – from owning a pet supply business, dog walking or pet sitting, to veterinary care or insurance. Yet, how can you ensure success in owning and operating your own pet business?
Any new business venture should be a well thought out plan, and not pursued at a whim. There are several factors you should consider in choosing a pet business that’s right for you. No doubt, owning any business will require hard work and commitment, so you should choose any area of the pet industry that you enjoy and in an area that you have some level of knowledge or experience. Yet, not all industries are alike and there are certain nuances to being a successful pet business owner.
1. Pick an Area of the Pet Industry That Appeals to You
Food and pet supplies are the largest revenue drivers of the pet industry. Nearly half the industry’s revenue is generated by big chain pet stores, such as PetSmart and PETCO. However, the pet industry is wide-ranging and many small operators are able to find opportunities in niche markets.
- Retail Food and Supplies. Many small operators are able to find niche markets in local neighborhoods. If you can establish a store that’s not near one of the big chains or offer unique specialty products, you may have a steady stream of customers.
- Manufacturing and Wholesale Distributing. There are a wide range of products manufactured and distributed to pet retail stores. Some newer products include smart pet monitoring devices, toys, games, grooming equipment, as well as a vast array of pet food.
- Grooming and Boarding. There are many aspects to keeping pets safe and well cared for. Grooming is just one important part of pet care. In addition, owners need someone to watch their pets while they are away, which makes a pet sitting business or pet boarding a great idea.
- Animal Health Care. When pets get sick, they need veterinary services. Yet, if you don’t have the background to own a veterinary business, there are many other health related business opportunities, such medical supplies, pharmaceuticals, nutritional supplements and insurance.
- Animal Training. Many dog owners need professional trainers to teach their pet good manners and correct behavioral issues. Professional guide dogs need to be trained to assist the handicapped, as well as pets participating in show competitions.
- Sales. Although it makes up for a smaller percentage of the pet industry, pet stores that sell animals are still available throughout the US. Plus, there are niche markets for exotic reptiles, fish and birds.
2. Target a Strong Market Area Where There’s a Need
Nearly 68 percent of households in the US own pets, and the need for pet services is only expected to grow. While retail chains dominate the industry, high net worth areas are willing to spend more on pet services, such as grooming, dog walking and boarding. They are also more likely to purchase pet insurance, training and other specialty services.
- Professionals and families are big spenders. Consumers between the ages of 45 to 64, those who are established in their careers, make up 48% of the market, while consumers age 35-44, who typically have children make up an additional 17.6% of the market.
- Apartment dwellers spend less. On the flip side, younger adults and retirees who live in apartments and have limited income spent less on pet products. Consider targeting customers in residential locations made up of working professionals, homeowners and families.
- Millennials pet owners are growing. As more Baby Boomers and Gen Xers advance in age, more millennials will own pets. Millennials, who often delaying child-bearing, are pampering their pets, often bringing them to work and spoiling them with premium pet products.
- Densely populated high income areas have higher market concentration. Not surprisingly, the majority of pet stores are located in densely populated areas of the U.S. California has the highest number of pet stores, followed by Florida, New York and then Texas.
3. Offer a Wide Scope of Products and Services
Providing a better selection of products and services will attract a larger and more diverse customer base. Your business may fluctuate and it’s always wise to draw in new customers.
- Offer more of what’s popular. If there’s a greater demand for high-end, grain-free dog and cat food in your market, offer a wide selection at different price points. If there’s a demand in your area for dog sweaters and clothing, offer a wide variety of styles and sizes.
- Dogs rule. Nearly half (48%) of all pet-owning households own dogs, followed closely by cats (38%), then freshwater fish (10%), followed by birds, reptiles, horses and saltwater fish. Consider offering products and services according to pet owners needs.
- Visit the competition. Sometimes the best way to gauge what’s popular and discover the hottest products is to visit a nearby pet store or popular website. Digital pet monitors that customers can operate from their smart phone are growing in popularity.
4. Invest in Marketing and Promotions
While big box retail chains account for nearly half the revenue, according to the American Pet Products Association, most pet owners spend equal amounts of time visiting independent stores and big box super stores.
- Make Your Product Visually Appealing. The pet industry is competitive and it’s important to promote products with eye-catching promotions and strong visuals. Pet photos and videos can be extremely engaging and attract a large audience, especially on social media.
- Offer special promotions and free samples. Pet foods and other products are ever changing and improving. Consumers are interested in foods that offer quality ingredients. Offering free samples or setting up a special display or kiosk is a great way to attract attention.
5. Hire Quality Employees
Before hiring someone with general retail or customer service experience, consider the knowledge and experience your business will require. Many services that involve working with animals require a certain level of skill and expertise.
- Experience Matters to Customers. When it comes to pet products and services, consumers can be very discerning. They want to know their pet is in good hands. Their pet may have specific dietary or behavioral issues that require a certain level of skill.
- Safety and Security. Many dog walkers are expected to be bonded and insured, as well as qualified to handle different types of dogs. Animal boarding facilities should take precautionary health and safety measures regarding a pet’s health, vaccinations or behavior issues.
6. Practice Effective Quality Control
Compared to human-consumed products, pet products are not necessarily subject to the same quality guidelines. Unfortunately, some pet products reach store shelves that are unsafe.
- Ensure quality standards. Each specific animal and breed may require different standards of quality and operators should be up to date on these requirements. All pet products should be inspected and tested before being sold to customers.
- Stay up to-date on recalls. Pet business owners should stay up to date on any product recalls and pull products immediately. Such items would include pet food, toys, treats, nutritional supplements, medications or other items.
7. Consider Buying an Existing Business
Consider purchasing an existing pet business that has a proven track record, including an established customer base, brand recognition and existing cash flow. Know how to spot a good business and determine if it’s a good fit. Searching for a business is easy with BizBuySell.
Advantages to Purchasing an Existing Pet Business
- The customer base is already established for you.
- It’s easier to purchase supplies with established vendors.
- The store location may ideal and need fewer alterations.
- The business may already be profitable compared to starting from scratch.
What to Look For When Buying an Existing Pet Business
- Look at the business’s revenue, sales and financial history.
- Find out what’s their biggest business challenge.
- Find out who are their major competitors.
- Ask why the seller wishes to sell.
- Consider getting professional advice on purchasing.
The Search Starts With an Idea
There are many opportunities available for owning a pet business – from well-established businesses to well-known franchises. The key to success is studying the industry and following your passion and having a well-though-out plan. With a positive forecast for this growing industry, the future is bright for new business owners.
Sources:
Springer, Julie. “2017-2018 APPA National Pet Owners Survey.” American Pet Products Association, Inc. https://www.americanpetproducts.org. Accessed October 2018.
“Pet Stores in the U.S.”, IBISWorld Industry Report 45391, IBISWorld, July 2018 https://www.ibisworld.com. Accessed October 2018.