Everything You Wanted To Know About... The Pet Business

If you are thinking about buying a franchise in the pet business, your timing could not be better. The pet industry is in a growth trend that has yet to see its upper limit.

Industry experts estimate that pet ownership in Canada is approaching 70 per cent of households. Recent research by the American Pet Products Manufacturers Association found that, while other market sectors have shrunk over the past decade, pet spending in the US has doubled from $17 billion in 1994 to a projected $34.3 billion in 2004.

"Those sorts of numbers mean that the pet industry is 60 per cent larger than the toy industry and 33 per cent larger than the candy industry in the US. Our research shows Canadians spend even more per capita on their pets," says Tom Copeland, Ontario master franchisee for the Quebec-based Multi Menu - Pet Food and Accessories.

North Americans' love affair with pets is confirmed by a recent survey of pet owners by the American Animal Hospital Association. The survey showed that 90 per cent of pet owners would not consider dating someone who was not fond of pets. Eighy-three per cent refer to themselves as their pet's mom or dad. Fifty-nine per cent celebrate their pet's birthday and 44 per cent would spend $3,000 or more to save their pet's life. Consumer's devotion to their pets has created a range of new market trends.

"Twenty years ago, the most expensive dog bed was priced at around $50. Now, you can find beds upwards of $300. There is an incredible range of products coming into the market: Gucci collars for $1,500, doggie t-shirts for $50, automated litter box cleaners, designer fountains for cats to drink from. You wouldn't have seen a market for any of those products a generation ago," says Mark Reynolds, president of Ruffin's Pets.

What's driving this explosive growth in the pet business? Franchisors universally point to the influence of the trend-setting baby bomer generation.

While the baby boomer generation is the single biggest demographic trend, there are other trends adding fuel to industry growth "The baby boomers are increasingly becoming 'empty-nesters' as their kids leave home. Also, as the boomers start to retire, they have more time on their hands. They are looking to fill that dual void with some sort of companionship. That group has a higher level of disposable income and they are starting to spend it on things they love," says Jeff Cooke, president of Bark Busters Canada.

While they baby bommer generation is the single biggest demographic trend, there are other trends adding fuel to industry growth.

"We are seeing more and more young families with young children who have a 'keeping up with the Joneses' view of pets. With so many other families in Canada acquiring pets, they feel they need to get one so their kids aren't left out," says Jim Walker, president of the Global Pet Foods and Ryan's Pet Foods franchises.

"The trend is also supported by advances in veterinary medicine. With pets living longer, there are obviously going to be more pets around," Walker adds.

With explosive growth comes competition. Already, the pet market in most major centers is dominated by big box stores like Petcetera and PETsMART, as well as the pet departments of major chains like Wal-Mart. As with any franchise opportunity, potential franchisees need to do their homework to find a market niche for their area. Fortunately, the franchise pet industry offers an attractive range of options, including large-capital stores and small home-based sales and services businesses. According to Reynolds, Ruffin's Pets has the edge on expertise. "Because of the big-box store, the old mom-and-pop independent pet stores are a dying breed. Our answer to the big box competition has been to focus on training. We have one of the most extensive training courses in the industry, covering all aspects of animal husbandry. We consider this a knowledge intensive business and that's how we've chosen to compete, rather than on price," says Reynolds.

A retail background helps, but we can train people to do that. What we cannot train is a love of animals. That is an absolute must. You don't have to be a vet, a breeder or a groomer, but you do have to be passionate about the well-being of animals.

Global Pet Foods and Ryan's Pet Foods stand out on the quality of food.

"We like to call ourselves 'a health food store for your pet.' Since pet owners regard their pets as full family members, the owners want to food their pets food equivalent in quality to what they would feed other members of their family," says Walker.

Convenience and service are the keys to the success of the Multi Menu franchise.

"Our niche market is home delivery. We work on developing the personal relationships with our customers, which the big box stores can't provide. We provide knowledgeable service and advice on a one-on-one level," says Copeland.

Barkbusters Canada covers the service aspect of the industry by providing in-home training for barking and other pet behaviour problems.

"With the increased number of pets comes increased problems like barking. Before our franchise came along, there weren't too many options besides time-consuming obedience courses. We take a respectful, sensitive approach to helping people make their pets fit in with their lives. In the case of barking, our methods can solve a barking problem in about three hours," says Cooke.

No matter what the niche market, a franchisee needs to consider carefully whether he has the skills to make it. Obviously, business skills are a must, but none of the Canadian Franchise Association pet franchisors emphasize it.

"A retail background helps, but we can train people to do that. What we cannot train is a love of animals. That is an absolute must. You don't have to be a vet, a breeder or a groomer, but you do have to be passionate about the well-being of animals," says Walker.

People skills are equally important as pet skills.

"The biggest thing we look for is personality. After all, you may be dealing with pets but you are selling to human beings. As in any business, you have to create a positive relationship and a positive experience for the customer. If someone wants to tell you a story about something adorable their cat Fluffy did, you have to be able to listen and laugh even though you may have heard that sort of story a million times before," says Reynolds.

For all of its challenges, the pet industry offers many rewards beyond just the monetary ones. The pet industry also offers some interesting challenges not found in other businesses. For example, it is one of the few businesses where inventory or client mortality is a major part of the business plan. It is also a business that calls for long hours and hard work, say the franchisors. In a retail pet business, the working day includes the care and cleaning of live stock areas both before and after the store opens. In the service industries, franchisees must be prepared to work flexible hours to meet the schedules of the owners and their pets.

"is a very positive business. When people come into our stores, they are coming to buy something for someone they love or to acquire a companion who will give them unconditional love. People are happy when they come into a pet store. That makes it a very enjoyable business to be in," says Reynolds.

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