For more than a decade, the pet industry has been among the hottest business categories, spawning products and services ranging from pet strollers and clothing to doggie day-care services and pet waste pickup. Today, U.S. consumers may be tightening the purse strings a little more, but they’re still opening their wallets for their furry friends.
According to the American Pet Products Association, U.S. pet owners will spend about $47.7 billion on pets in 2010 — up from $45.5 billion in 2009. Of that, some $18.3 billion will be spent on food, $11 billion on supplies and medicine, and $3.5 billion on services such as grooming and boarding.
The APPA reports that 62 percent of U.S. households own a pet. While nonessential pet expenditures like fancy pet toys might get cut out of the household budget, essentials will still be part of the picture. And as pets have come to be considered part of the family, the definition of “essential” has expanded. In particular, the APPA says that Earth-friendly pet products are gaining in popularity. These include natural litter, toys, and accessories, as well as organic pet foods.
Of course, pets also improve humans’ health and well-being — perhaps one reason spending on animals continues to be so strong. “In tough times, people look for the unconditional love and support that [animals] give,” says Paul E. Pickett, vice president of franchise development at Wild Birds Unlimited, a franchisor of retail backyard bird feeding supplies. Wild Birds has benefited from the effect of the economy. “We were very pleased with our 2009 same-store sales numbers,” says Pickett.
With more people “cocooning” at home to save money, he adds, Wild Birds has focused its marketing efforts on the “staycation” — “have your vacation at home and enjoy your backyard. People are focusing on simple pleasures.” That’s a trend he expects to continue even after the economy brightens. Says Pickett, “We’ll see a shift in the way people spend their time in general.”
“Dog behavior is relevant almost everywhere in our society, so the need for our services has not diminished in this economy,” says Joan Trinka, director of franchise development at dog training franchise Bark Busters. To keep sales strong, the company is focusing on niche marketing efforts. “We have many different marketing programs for our Bark Busters franchisees to use to grow their business,” says Trinka. “Safety programs for children to learn how to behave around dogs, vet technician seminars on handling difficult dogs, and “naughtiest dog” contests we run with radio and TV stations are a few examples of the literally hundreds of ways we give franchise owners to market their business.”
Marketing is important at Pet Butler as well. The pet waste removal franchisor is “focusing more than ever on generating buzz and PR,” says founder Matt Boswell. “We have also improved our online signup system to make it easier than ever for a prospective client to get all the information they need and sign up for Pet Butler’s services any time of day or night.”
As with most business owners, financing is a key concern for pet franchisees. Aussie Pet Mobile, a mobile grooming franchise, provides a $5,000 discount off its franchising fee for military veterans, says Nicola-Jayne Aymes, consultant with Aussie Pet Mobile. For all franchisees, “We offer an incremental territory at half the price of a normal territory,” she adds. Incremental territories are those adjacent to the territory a franchisee has already purchased.
Pet Butler is also taking steps to help franchisees with financing. “We are now on the SBA registry and we are accepting credit cards for part or all of the franchise fee,” says Boswell. “Additional credit lines and financing resources have been made available for startup costs and ongoing business expenses. We also unveiled a program that gives each of our current franchisees the ability to earn a free franchise territory to help them expand their business and protect their client base.”
Once franchisees are up and running, managing costs is crucial to success. At Wild Birds, the franchisor is making focused efforts toward cost management and helping the stores with cash flow, says Pickett. At Pet Butler, says Boswell, “[We are] analyzing and honing every process and system we have to better serve our franchisees.” Recently, Pet Butler revamped its billing systems, making everything a lot more transparent and accessible for franchisees and clients.
Overall, pet-industry franchisors are so positive about the future of their industry, they’re expecting to grow. “The pet industry is a strong and vibrant sector that offers many fantastic opportunities right now,” says Boswell. Pet Butler is even seeking out partnerships with other pet franchises to increase customer loyalty and build revenue through new alliances.
“We are in a recession-resistant business,” says Aymes. “Pet-care franchises will continue to build at the same aggressive rate as the population ages and pets become more and more the ‘children’ of the home.”
For a complete list of pet franchises, visit the Pet Franchises section of the AllBusiness.com Franchise Directory.
Maria Valdez Haubrich is chief liaison officer and Karen Axelton is chief content officer at GrowBiz Media, a content and consulting company that helps entrepreneurs start and grow their businesses.