The word “unprecedented” has been tossed around quite liberally over the past year, but there may be no better way to describe the impact that the global COVID-19 pandemic has had on our lives and the way we do businesses since early 2020. Rolling lockdowns, record levels of unemployment, restrictions on social interactions and a general fear among the public have all presented overwhelming challenges in just about every aspect of our society, and pet stores certainly have not been immune.
Now, combine that with the economic fallout from the pandemic, ongoing social and political unrest across the country, and natural disasters that seem to spring up seemingly on a monthly basis and you have the recipe for one of the toughest years that a pet specialty retailer could possibly face.
However, as we’ve seen time and again over the past two decades, the pet industry’s retail chains are a resilient bunch—a point that has been made clear by this year’s Top 25 Pet Retailers list. In fact, more than half (15) of the retailers on this list added at least one store under their respective banners since February 2020, even in the face of all the challenges mentioned above, while only seven closed one or more locations over the same period.
While these trends hold promising signs for the overall health of the pet specialty retail channel, it should be noted that the total number of stores encompassed by the Top 25 Pet Retailers list actually declined over the past 12 months, going from 6,209 stores to 6,063 stores over that span. This, however, was largely due to Canada-based Pet Valu’s (#4) decision to close all 358 of its U.S. locations, which were primarily in the Midwest and Northeast. If not for those closures, the total number of stores represented on the list would have increased by more than 200 to reach the highest level since Pet Business began the ranking more than 15 years ago.
Of course, growth was not evenly distributed across all of the retail chains on the Top 25 list, and there were several positions changes as a result. Among the most notable changes were:
• Pet Supplies Plus moved up from No. 4 to No. 3 with 79 new store openings.
• Pet Valu dropped from No. 3 to No. 4 because of the closure of its U.S. locations.
• Woof Gang Bakery moved up from No. 9 to No. 8 with 15 new stores.
• Petland moved down from No. 8 to No. 9, despite adding 11 locations.
• Earthwise Pet Supply jumped up from No. 22 to No. 19 on the strength of eight new store openings.
• Pet Depot moved from No. 25 to No. 24 with the addition of six new stores, reversing the contraction it had experienced between 2017 and 2020.
Franchises Growing Fast
Interestingly, of all the new stores added by the Top 25 Pet Retailers, more than half (122) were opened by six of the franchises on the list. Pet Depot (#24), Chico Pet Stores (#20), Earthwise Pet Supply (#19), Petland (#9) and Woof Gang Bakery & Grooming (#8) all grew their chains since the last edition of the, with each adding between three to 15 new stores. However, the biggest growth among the franchises was experienced by Pet Supplies Plus (#3), which added 79 new locations over the past year.
According to CEO Chris Rowland, approximately 90 percent of these new stores are franchise locations. The company did reopen some of the approximately 40 former Pet Valu stores it acquired in December—located in Indiana, Kentucky, Maryland, New Jersey, Ohio, Pennsylvania and Virginia—as corporate locations. However, Rowland says that Pet Supplies Plus plans to refranchise a majority of these stores as well.
When asked what has driven the chain’s rapid growth, Rowland points to the franchises track record and investor interest in the pet industry as major factors.
“Our turnkey model, 30 years of positive sales growth, a passionate industry that has thrived during COVID and investors looking to diversify their portfolios are all factors that have helped to fuel our growth,” he says. “We have almost 200 stores that are sold that will be opening in the coming months and years.”
Looking forward, Rowland sees even more opportunities for growth, especially since its acquisition by Franchise Group Inc. in January 2021.
“They have other retail investments that should allow us to leverage some costs on shared services and overhead,” he says. “They are also very interested in expansion opportunities that may include purchasing other pet businesses to accelerate our growth plans.”
Woof Gang Bakery & Grooming serves as another great example of how a proven track record can drive the growth of a pet retail franchise. After nearly tripling in size between 2014 and 2020, the chain added another 15 new locations over the past year—including its first stores in Alabama, Colorado and New Mexico. To understand what is driving this robust expansion, one probably need look no further than the success that Woof Gang’s established stores have enjoyed year after year. In fact, according to founder and CEO Paul Allen, the chain’s average per-store revenue was up by more than 23 percent YOY in 2020.
Also critical to the growth of the Woof Gang Bakery & Grooming franchise, says Allen, was the decision to place a large emphasis on grooming services.
“The key factor driving our exponential growth was the decision to introduce professional pet grooming to our business model,” he explains. “By listening and responding to market demand, we realized 10 years ago that this foundation of service would be a core element in storefront success.”
According to Allen, Woof Gang’s grooming service offerings have been so successful that the chain plans to expand this focus in the months and years ahead.
“We will build on our grooming success and have plans to open stand-alone Woof Gang Grooming locations,” he says. “We are also looking at Woof Gang Wellness as the next service category opportunity, including veterinary and wellness care, within Woof Gang Bakery & Grooming stores.”
A Top 25 Trio
One of the biggest stories related to the Top 25 Pet Retailers over the past few years has been the emergence of Independent Pet Partners (IPP), which operates three of the chains on the list—Loyal Companion (#18), Chuck & Don’s Pet Food (#21) and Kriser’s (#23). The company, which also operates 19 stores in Texas under the Natural Pawz banner, had another strong year in 2020 despite the challenges presented by the pandemic.
This was no small feat, considering the fact that the independent pet retail channel overall was still recovering from an already difficult period, as IPP CEO Jeff David points out. “The indies were knocked around a bit by the DCM issue, which impacted a bunch of the indie food brands in the back half of 2019,” he explains. “That recovery was setting in when COVID hit. So, it’s been an interesting 18 months.
“The good news for us is that we are in a very solid position, and we are happy with what we were able to achieve during the course of 2020.”
According to David, the solid position that IPP’s retail banners find themselves in is largely due to the company’s willingness to embrace new technologies while adjusting to a fundamentally changed retail environment.
“We only launched e-commerce for all of our brands in January 2019,” he explains. “And we had plans to launch the buy online, pick up in-store and same-day home delivery initiatives during the course of 2020. Of course, when COVID-19 came along, we had to accelerate all of that.
“I would characterize 2020 as a year of bobbing and weaving as the marketplace changed, not only from a consumer perspective, but also in keeping people healthy and keeping stores open. We had to bring forward initiatives to make it easier for pet parents to connect with us. It was an emotionally distressing year for everyone, but it brought everyone together in realizing the strength of the relationships that we have internally and with the pet parents we’re privileged enough to serve.”
Although many of the technologies and initiatives IPP has focused on over the past year were adopted in direct response to the pandemic, David expects them to have a long-term impact on the company’s chains. “The pandemic has sped up our engagement with technology and our ability to provide an omnichannel experience by augmenting the experience in our stores with what we can offer online,” he says. “All of those things are going to change the way we connect with our customers. Anyone who isn’t embracing these technologies does so at their peril.” PB
TOP 25 PET RETAILERS LIST
Territory: U.S. & Canada
Territory: U.S. & Mexico
San Diego, CA
3. PET SUPPLIES PLUS
Territory: East Coast, Midwest, TX, CA
4. PET VALU*
Markham, Ont., Canada
5. PET SUPERMARKET*
Territory: Southeast, Texas, CA & NV
6. GLOBAL PET FOODS
Brampton, Ont., Canada
8. WOOF GANG BAKERY
Territory: NV, TX, TN, NC, GA, FL, NJ, KS, SC, VA, CT
Territory: U.S., Canada & Mexico
10. HOLLYWOOD FEED
Territory: TN, TX, AL, AR, MS, SC, FL, GA, IN, KY, LA, NC, OK
11. BOSLEY'S BY PET VALU*
Richmond, BC, Canada
12. PET PEOPLE
Territory: OH,IN,MI, IL, NC
Richmond, BC, Canada
Montreal, QC, Canada
14. PET PLANET
Territory: Canada, AZ
Calgary, AB, Canada
15. PET FOOD EXPRESS
San Leandro, CA
17. UNLEASHED BY PETCO
San Diego, CA
18. LOYAL COMPANION**
Territory: Northeast, U.S.
New York, NY
19. EARTHWISE PET SUPPLY****
Territory: CA, NM, KS, TX, OH, FL, SC, GA, NJ
20. CHICO PET STORES
Montreal, QC, Canada
21. CHUCK & DON'S PET FOOD**
Territory: MN, CO, WI, KS
New York, NY
22. BENTLEY'S PET STUFF***
Territory: IL, MO, MN, WI
Territory: IL, So. CA, CO, TX, VA
New York, NY
24. PET DEPOT
Territory: U.S., Canada
25. CONCORD PET
Territory: DE, PA, NJ, MD
Total # of stores, as of March. 1, 2021: 6,063
*Pet Valu, Pet Supermarket and Bosley's by Pet Valu are owned by Pet Retail Brands, which also operates 18 Paulmac's Pets stores in ON & NS, Canada; as well as 17 Total Pet Stores and 9 Tisol Pet Nutrition & Supply Stores in BC, Canada.
**Kriser's, Chuck & Don's and Loyal Companion are owned by Independent Pet Partners, which also operates 19 Natural Pawz stores in Texas.
**Bentley's Pet Stuff also operates 9 Protein for Pets stores in Southern CA, as well as several single-store retail banners in CO. GA, MI and IL.
****Earthwise's parent company operates 17 Nature's Pet Market stores in OR and WA.