New Business Endeavor
United States’ households have more than 93.6 million feline pets and 77.5 million canines. It is even more fascinating to note that there are more pet fish than any other pets, with an estimate of 171 million. In addition, there are about 13 million horses, 13 million reptiles, and 15 million birds to complete the pet community. It is reported that in 2010, pet owners spent approximately $50 billion on their ‘furry and winged’ companions.
A small sized pet store is, therefore, proposed, catering for both low end and high end clients. The business is complemented by an online store in order to combine the benefits of a physical outlet and those of online pet retailers. This is projected to bring about great savings on start up capital by saving on floor space requirements, hence lower operational costs and better differentiation from common small pet stores. In essence, this store is meant to be larger than typical small pet stores in terms of operation and supplies.
Pet industry has proven to be unique in that it has continued to thrive regardless of economic times. There is an immense potential growth for the industry, and even top performers in the pet specialty industry occupy a mere 20% of the market. Therefore, there are many growth opportunities for starters as well.
- Research and Best Practices
Research on the pet industry has been done and the business idea put to test by conducting SWOT analysis and Value Chain analysis in a move to explore the degree of feasibility of the idea.
- Research Findings
The pet store business idea was confirmed to be worthwhile and viable.
From the research, it is recommended that the business should proceed as stipulated in the proposal.
I plan to start a pet store enterprise that provides high quality pet supplies and services at a retail level. The purpose of this venture is to fully cater for the needs of pet owners, which will ensure that they are well equipped to care for the well-being of their pets. The business will be registered as a sole proprietorship, and the proposed location is at a local mall or near a high traffic discounting shop. The business will operate as a physical enterprise as well as an online store in order to capture target markets on both segments.
The business will specialize in cat and dog supplies as the two are the most popular animal types within the US. Other animals will include birds, small reptiles, and fish. The business will provide a large variety of dog breeds from credible suppliers and not from puppy mills. Another option is to take care of animals, especially dogs and cats, in order to help out with the situation. The business aims to offer clients a variety of pet foods ranging from everyday community food to high end premium feeds. For customers concerned with a good health of their pets and those who want to go all natural, there is a plan to add that too. As for other pet supplies, business aims to provide grooming products for animals, chewing toys that are harmless to animals, food and water bowls, cages, and leashes. To start with, the store will offer basic pet services such as veterinary services, pet grooming, and pet training. In addition, there will be dog and cat daycare facilities for pet owners, who want to leave their animals during the day. My role in the business is to work as the overseer of stores’s day-to-day operations. It is more of a managerial role. Additional services bring about the need to hire trained manpower to take care of all clients’ needs. However, the number of employees will depend on the demand as the store grows.
The business will be driven by proprietor’s passion for animals. I like spending time with animals, hence this motivates me to start a franchise in this direction. Though not formally trained to work with animals, I can confidently state that I have hands-on experience of working with animals in various situations. First of all, I have 3 pets: a cat, a dog, and a rabbit that I have owned for the last 9 years. I have also volunteered in community animal shelters to help out when the staff is overstretched.
I am also a subscriber to many respected pet publications like the Pet Dealer Magazine, Pet Business Magazine, Pet Supplies Marketing and the like. Often, I try to secure a summer job at a local pet store, which I have always enjoyed since my high school years.
I am an entrepreneur at heart and I am convinced that starting my own business is the best way to ensure that I merge my business skills with my passion for animals, hence creating a business that I would truly love. The experience of owning pets has brought many ideas to my mind. Moreover, I would like to see many things changed in the pet industry as well as explore opportunities that I intend to tap.
The ultimate goal of starting this store is to provide value to all customers from the lower end to high end by launching a pet store that caters for all customer needs, which will be different from other local retail pet stores. Things like premium pet foods, live animals, and most pet services have been a preserve of large store chains, and I intend to change that perception. I also consider myself to be one of the major campaigners against puppy mills and I want to participate in lawful trade of pets as well as to protect pets currently housed in shelters.
Research and Best Practices
Strengths, weaknesses, opportunities, and threats analysis was carried out to investigate what the business should capitalize on, watch carefully, improve on, or discard. This was done to forecast enterprise’s chances of survival. Research was done to examine both internal and external business environment. For starters, researchers visited existing pet stores including pet superstores, grocery, drug stores, small pet shops, and online retailers. This provided insight on the level of competition a business dealing with pet supplies could expect. Research was carried out on the prospective capital that would be required to start a retail pet store business of a slightly larger scale. We also investigated the difference in variety of pet supplies found in small stores versus large retail chains. It was noted that the business is likely to enjoy opportunities for shop brand growth as a new enterprise since shoppers who are curious to see what it has to offer are expected to flock in.
Economic opportunity is considered to be favorable since pets are taken to be a part of the family and get pampered even in hard economic times. An increased variety of pet supplies and services will position the store at a higher level of competition compared to typical small pet shops. On the social grounds, the society has a greater interest in pets than at any other time before. This has been demonstrated by the emergence of special pet facilities all over the country, like dog parks, dog beaches, and pet luxury hotels. When it comes to competition, small shops are faced with major competition from large retailers and online discounters like Walmart. This is because large pet specialty stores are known to provide greater variety of pet supplies and services. In addition, their counterparts, large online retailers, are seen as one stop shops, which is also an attraction to customers.
While these large stockists might be more attractive to clients, they require large storage space, hence large operating overheads, which will be a weakness if we decide to set up a large pet store.
Value Chain Analysis
This type of analysis helps demonstrate how the business will create customer value. We carried out an analysis of the proposed pet store’s inbound logistics that dealt with getting products from suppliers and managing inventory (Porter, 2008). The business is expected to provide high quality products to customers.
Operations: for this pet store, operations should be smooth to avoid problems with any interested parties. Adequate staff to perform all necessary duties is a vital asset. In addition, clients value a clean, orderly, and fast service.
Outbound logistics: This includes all activities within the store geared towards getting the product to the customer. Research shows that there is a need for adequately trained staff in both supplies and pet services. The store should be easy to access from high traffic areas, and the goods should be easily accessible within the store.
Marketing and sales: This can be achieved through mailing advertisements, printing of fliers, television advertisements, and the like.
It was found that the existing small pet stores do not stock specialty or premium pet products. This makes them lose on the large margins that come with premium pet supplies. This supports the need for the proposed pet store to stock a wider variety of pet products, especially foods, in order to attract customers from low end and high end markets.
A name is really important for businesses to thrive in the pet industry. This is evident from the two leading pet specialty stores in America: PetSmart and PETCO. Both enjoy high returns for their brand names being top brands in pet supplies. Therefore, trying to incorporate some of the premium foods and pet services found in these best-performing stores is a great way of starting to build a name for a new store. Good reputation also means good social standing within the community. This supports the idea to source for pets from credible pet suppliers and not puppy mills as well as sponsoring pets in shelters for adoption (Nigro, 2007).
Research has shown that just like any other business, pet stores take time to grow in terms of sales, though this is also a factor of the effort that management makes in terms of marketing and value addition to products. Thus, the proposal to start an online store together with the physical pet store will add value to business’ operations, marketing, and sales avenues. This is because an Internet business is easier to start even with little capital and enhance store’s presence within the industry by reaching out to more people.
The online store will, therefore, help increase sales and provide information about available offers at a glance, which, normally, customers are reluctant to ask. Online venture is also able to reduce inventory burden and storage space demands since the store can organize direct delivery of goods from suppliers to consumer premises.
Retail pet store business was found to be an economically viable idea to implement. Based on research findings of the business environment and social trends, the pet store industry has a lot of growth potential. It has been found that the pet industry is an industry that is almost resistant to harsh economic times. This is because an average pet owner considers their pet a part of the family and provides for them as is usual. This means that the demand for pets and pet supplies and services can only increase. It is, therefore, important for a new pet store to aggressively market itself in order to curve a niche for itself in the market. This can be done by adding value and keeping a consistent brand promise.
Research affirms that for small retail pet stores to thrive, diversification is the way to go. As a result, it is recommended that the new pet store proceeds with the plan of offering a wide variety of pet foods, live animals, and pet services in order to clearly differentiate itself from the smaller pet stores. Due to an evident limitation of capital to invest, it is advised that the pet store focuses on stocking a wide variety in smaller quantities and opts to replenish the stock more often rather than borrowing large amounts of capital.
The combination of both Internet business and the physical store is a great idea since the two complement each other to maximize sales. Hence, it is recommended that the online store can be launched simultaneously with a physical outlet. or online store can be started ahead of the physical store. It is also vital for the variety of products on offer to be complemented by qualified staff so as not to compromise the quality.