Editor's note: What kind of pet business should you
start? Read "10 Pet
Businesses to Start" to get some ideas.
Susan Benesh, president of Posh Poochy Inc., a Columbia, South Carolina,
manufacturer of clothing, collars and accessories for dogs, thanks
her beloved bichon frisé and pug for their inspiration.
The idea of launching a pet company began when strangers stopped
Benesh in the street to ask her where she bought the cute sweaters
and collars her two pooches were wearing. Benesh realized that the
items she enjoyed crafting for her own canines could make her some
money.
Benesh, who formerly owned a small publishing company, began
investigating the field by visiting independently owned, high-end
pet boutiques in cosmopolitan markets such as Atlanta, Los Angeles
and New York City. They instantly wanted to carry her items, and
she soon had trouble keeping up with demand. She sent out free
samples to other retailers around the nation and listened to their
feedback. In addition, she conducted Google searches to obtain
information and statistics on the pet industry. Benesh also
compared her pricing and offered a differential that other high-end
dog apparel makers didn't provide. For instance, instead of
charging $1,200 for dog beds that few people will buy, Benesh's
beds cost between $195 and $225.
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With sales already surpassing $1 million this year, Posh Poochy's
merchandise is sold at 400 pet shops in the United States and
around the world, as well as online. Benesh and her three employees
work out of an office and warehouse, totaling 3,000 square
feet.
"You've got to have a specialty, be more affordable
than what's out there and not try to compete with the big pet
stores if you're starting out," says Benesh, 47, who
launched Posh Poochy in 2003.
Hot Market
Benesh is part of an explosion in pet businesses that is inspiring
many new entrepreneurs to start their own ventures offering a
product or service for Rover, Fluffy or almost any kind of animal
you can think of. Since many animal businesses can easily be
launched at home with little capital, entrepreneurs are lining up
by the dozen to sell their wares. Based on attendance at the
American Pet Products Manufacturers Association's recent annual
trade shows, an estimated 125 to 150 new pet business are created
each year, and there are no visible signs of a slowdown anytime
soon, says Andrew Darmohraj, vice president and deputy managing
director of the Greenwich, Connecticut-based organization.
Just look at the numbers spurring this continuous growth. Pet
spending has more than doubled in the past 11 years--from $17
billion in 1994 to a projected $35.9 billion by the end of this
year, according to statistics from the APPMA. Fueling this trend
are empty nesters lavishing attention and money on their pets,
young adults who are having children later and currently put their
time and energy into their animals, and a pet industry that has
become more sophisticated at consumer marketing, points out James
Chung, president of Reach Advisors LLC, a Belmont, Massachusetts, business
strategy and research consultancy. The influence of mass
media--including popular cable channels like Animal Planet--has
also made the family pet more revered than ever, Darmohraj
adds.
In fact, the pet business is now the seventh largest retail
segment in the nation, with consumers spending more on their
beloved creatures than they do on candy or toys, according to the
APPMA. And a whopping 63 percent of all U.S. households--or 69
million homes--have a pet.
But don't think it's too late for you. There is still
plenty of room for new ventures--as long as they offer something
novel or really useful. "The pet industry, unlike many others,
is almost recession-proof," Darmohraj says. "Consumers
will always be willing to spend money on their animals no matter
what, like they would on their kids."
Despite the existing demand, you need to carefully research a
product or service to find out if there is enough of a need for it,
or conversely, if your segment of the market is oversaturated. You
also need to put aside the notion that just because you adore your
dog or cat, owning an animal business will automatically be fun and
easy.
"People think, 'Oh, I love dogs, so I'll start a
dog-sitting business in my home.' It's not that easy when
you're dealing with animals that aren't your own, and you
shoulder a tremendous responsibility when you're taking care of
someone else's pet," says Gene Fairbrother, Dallas-based
lead business consultant for the National Association for the
Self-Employed and president of MBA Consulting Inc. "You also
have to check with your state licensing board to make sure you have
the proper license and liability insurance."
For instance, about half the states have some kind of kennel
ordinance and licensing, says Jim Krack, executive director of the
American Boarding Kennels Association in Colorado Springs,
Colorado. Dog day-care and boarding centers are rapidly expanding
to include services like hydrotherapy for dogs, even offering video
access for pet owners who are traveling and want to see their pets
in action at such facilities. If you are considering starting a
business with such services, Krack says, you definitely could have
a leg, or paw, up on the competition.
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