Pet Retail Consulting Services, Expert Pet Retail Consultants

About the Pet Retail Industry

The market for pet goods and services in the Middle East has been growing consistently over the years with cities like Dubai taking onus for the significant chunk of the trajectory. No doubt that the increasing pet population is a major factor but rising awareness concerning pet health and general pet care has made the market more dynamic. The rising instances of pet adoption continue to play a part in this growth journey.

Several independent forecasts point towards strong and steady market growth in the coming years. The growing number of pet retail businesses in the region also testifies to this. What makes things more interesting is the way modern ways of retailing have pervaded this sector.

It might be worthwhile to go a bit further down the rabbit hole and find out what business insights it holds for existing retailers and aspiring retail entrepreneurs in the Middle East.

Challenges in the Pet Retail Industry

ECommerce versus Brick-and-Mortar

ECommerce proved to be a big challenge for retailers in all verticals. The pet retail industry was no exception. Many big pet retail brands took the eCommerce route to directly reach out to their customers delinking the intermediaries in the traditional supply chains. The competition from the eCommerce channel continues to be a challenge for all brick-and-mortar pet retail stores that have not yet gone omnichannel. Competitive pricing and greater convenience have forced many traditional retailers to level up their game and start their online sales channels either directly or by becoming sellers on online market platforms.

Big retail supermarket chains are scripting a slightly different story. Their strong brand image with omnichannel capabilities helps them thwart the competition from players selling exclusively via the eCommerce channel. These supermarket brands have brought the best of both worlds to their customers.

Attraction and Loyalty for Established Brands

Well-established brands always have an upper hand over small businesses whether the former is selling via their exclusive outlets and/or their in-house eCommerce channels. When it comes to pet products and services, the inclination of customers to go for branded products and services is even stronger. Manufacturer-retailers adopting the D2C route make things more challenging for small businesses. It is difficult for small pet retail businesses to counter the long-held dominance of a limited number of brands in the global pet product market.

The Problem of Narrow Margins

As mentioned earlier, the retail pet product market has been dominated by a handful of brands for a long time. Their products have attained the status of being household names now. Since customers also tend to choose products of known brands, a large majority of the local pet retail stores prefer to deal in only those products. This often creates situations where small retailers have to work with narrow margins. In such a scenario, local players have very little scope to tweak their price tags for any competitive advantage over each other. Although many new manufacturers have emerged strongly in the last decades, not many local pet retail businesses show an easy inclination to align with new pet product brands.

In pet retail consulting for small businesses, YRC recommends considering the inclusion of quality merchandise from credible supply sources to overcome this margin crisis.

Leniency in Business Planning

Having affection for pets is one thing and being successful in a pet business is another. It is common to see pet owners being acute pet enthusiasts themselves. There are ways in which this helps in certain aspects of the business. However, there are a lot many other things that call for business acumen and meticulous business planning. Offering a broad picture for aspiring startups and managing business expansion, YRC recommends proper business planning that includes business idea validation, systematic market research, robust business model development, realistic financial and commercial planning, and strong operations management.

Misplaced Understanding and Empathy

To a large number of people, their pets are extensions of their families. This is not something new: humans and many species of animals have lived together like friends with no established common language but that of love, care, and empathy. Jump to the 21st century, our connection with not just our own pets but also with the animal community, in general, has reached new dimensions. Thanks to the increased mass awareness in this age of digital information. While there is a technical side to pet products and services, there is also a side of understanding and empathy for pet parents. At the level of retail (and for product/service development as well), this understanding and empathy help businesses improve customer experience. If this is disregarded, customers may not feel understood or valued. This is not very uncommon to see when retail business owners leave their customers in the hands of untrained staff.

Growing Complexities in Demand

Over the years, the pet industry has witnessed a surge in the demand for organic and natural pet food products. This is a relatively new trend and the supply chains are not quite mature yet. With fewer suppliers and high costs of production, organic and natural pet food products tend to be pricey affecting inventory budgets. Also, those days are long gone when one or two food products were considered sufficient for pets. Today, there is growing a demand for diet-based and seasonal foods for pets. This growing demand for a wide range of products has compelled retailers to expand their merchandising mix. Expanding product lines tends to slow inventory turnover and widen the scope of demand forecasting.

Knowhow and Adherence to Applicable Laws

Whenever a market for something expands and grows in an economy, it also brings with it increased legal and regulatory norms to protect the interests of the stakeholders involved. Animal welfare has always been a focal point of debates and discussions.

Today, the rules and regulations governing animal welfare, food quality and safety, production and product labelling, and pet-related care and support services have become stricter and more detailed. Any deviation could bring the ire of not just customers but also the relevant authorities. Retailers need to keep themselves updated on all applicable fronts.

As compliant enterprises, retail businesses can emerge as responsible brands and also offer well-informed services to customers.

Handling Social Media

Social media has the potential to deliver a wide range of business benefits. It helps brands and businesses to directly reach out to their target audience. Personalisation can further improve the ROI from social media efforts. However, social media is not entirely an ocean of opportunities. Doing it wrong could lead to landing in undesirable waters where there are no benefits. Since the pet business is a unique form of business, it calls for a curated social media strategy. Replicating strategies that work for others will not work. Besides, every business has a unique brand identity to establish and maintain. Two vital elements in a social media strategy are defining the brand personality and the buyer personas. These two personalities must meet each other and do the talking. In a competitive landscape, customers are under no obligation to change. It is the brands and businesses who must adjust their brand identity and strategy for social.

Current Trends and Future Projections

Pet Humanisation

Pet humanisation refers to the treatment of pets as a part of the family. It is becoming increasingly popular among pet owners and the trend is expected to continue. This has many important connotations for pet retail brands and businesses. For starters, there is already a significant increase in the demand for premium and sophisticated pet products and services. This often extends to personalisation resulting in tailored solutions. Some of the examples are:

· Foods with specific nutrition standards

· Personalised diets

· Organic food

· Luxury/premium pet accessories and apparel

· Modern pet healthcare systems

· Services of qualified, trained, and certified professionals

Various applications of modern technologies are now part of the pet industry starting from production to delivery. In the near future, we may see more collaboration between pet retail brands and pet healthcare clinics and hospitals.

The demand for personalised solutions is unlikely to fade any time soon. In general, pets also provide emotional support. They can partially, if not completely, fill the voids in the lives of individuals in societal frameworks that are increasingly becoming individualistic and as a result, also isolated.

Shift to Omnichannel

All major pet retail brands have already embraced eCommerce which turns them into D2C brands. Other small and big retailers and distributors have also done the same by becoming sellers on popular online marketplace platforms. Traditional pet retail stores that have not yet started their online sales channels will continue to feel the pinch of competition from online retailers. The challenge here for traditional retailers is not just adopting eCommerce but also becoming an omnichannel enterprise. Some of the big brands with their own chain of stores in the global pet retail market have not just adopted eCommerce but also omnichannel. This allowed them to cater to their customers via both online and offline channels in a seamless and integrated way. This is what traditional pet retail businesses must also do but in improvised ways.

Heightened Emphasis on Health and Wellness of Pets

Pushed by growing mass awareness and concern for animals, pet humanisation, and the proliferation of relevant content on social media platforms, there is a heightened emphasis on how animals are treated and taken care of. In this, health and wellness emerge as important factors. Animals not only need food but also appropriate medical care and attention as both precautionary and remedial measures. This has contributed to a surge in the demand for food and supplements meeting the nutritional standards, wellness support systems, medical care solutions, and pet health insurance.

Aligning with Sustainability and Ethical Standards

It should be difficult for manufacturers and retailers in the pet retail industry to acknowledge that sustainability and ethical concerns were always close to their doorsteps. These concerns are already a global phenomenon and resonate even more strongly when it comes to how animals (including pets) are treated and taken care of. This affects pet brands and businesses including manufacturers and supply chain entities from a long distance.

Proliferation of Smart Products

Humans are not the only ones to use smart devices; there are smart products for pets too. Smart devices like wearables, GPS trackers, cameras, and automated feeders and litter boxes are increasingly becoming popular. This may not be a phenomenon evenly spread across the world but there is a growing global market for these products. This is important for pet retailers as they can extend their offerings by including these smart devices as per the existing and emerging demand trends in their local markets.

Identifying and Catering to Niche Segments

The nature of demand in the pet market has significantly changed over the last five to ten years. What is considered a ‘pet’ has changed. This changes what customers demand in terms of products and services for their pets. The factor of pet humanisation has also diversified these requirements. Increasing awareness of pet health has led to an increasing demand for high-end pet foods and supplements and pet care solutions. These developing trends affect retailers and to compete more effectively catering to niche segments will become increasingly important.

Data Centricity and Digital Transformation

Data-driven business decision-making is unavoidable especially when a micro or small enterprise begins to experience scale. From optimising inventory management to designing better CX strategies, data-based systems become highly relevant. This will make digital transformation quintessential for traditional pet retail businesses.

Why YRC as Pet Retail Business Consultants

We are a consulting firm in the retail and eCommerce space with scaling global operations. We offer solutions for enterprise set-up, scale, and enterprise management. With 10+ years in business, we have a rich experience of working with 500 enterprises from over 25 verticals.

If you own a pet retail business or are on the verge of starting one, our experience and expertise can help you in numerous areas of business planning and implementation.

Market Research

In market research for pet retail businesses, we carry out extensive market analysis to provide clients with actionable insights and CTAs on numerous strategic areas (highlighted below) aimed at helping them come up with better business plans.

· Market gaps and potential
· Market classification and segmentation
· Identification of strong value propositions
· Defining consumer behaviour and buyer personas
· Market entry and exit
· Opportunities for growth and expansion in future
· Pricing
· Channel and distribution
· Advertising and promotions

Pet Retail Business Model Development

The global pet industry is going through a rapid phase of transition affecting not just retail businesses but all enterprises in the supply chain dealing with pet products and services. Given the circumstances of the day, business model development in pet retailing can no longer be treated with a traditional approach. The heightened cross-channel competition also makes the equation of value propositions more complex. Here, YRC incorporates several modern-day elements of business modelling like omnichannel, personalisation, localisation, sustainability, dynamic pricing, customer experience, niche positioning, and digital transformation.

Omnichannel Adoption

Delaying the adoption of an omnichannel strategy is delaying the imminent for retail brands and businesses in any industry. The pet retail market is no exception. Pet retail is a relatively novel form of business in many regions. Giving the right shape and size to an omnichannel system can take months or even years. Getting it right from the word go can give pet retail businesses (including startups) a competitive advantage. Also, a shaky omnichannel setup does not augur well for customer experience. In its more than ten years of experience, YRC has helped numerous enterprises shape the strategic planning and implementation of their omnichannel transformation. Our hold over both retail and eCommerce gives us leverage in developing more effective and efficient omnichannel systems on shorter timelines.

ECommerce Consulting for Pet Retail Businesses

With omnichannel becoming a must-have feature in the pet retail business, new and existing enterprises in the brick-and-mortar format must not only add the eCommerce channel but also do it strategically for a smooth transformation into becoming a robust omnichannel enterprise.

In eCommerce consulting for pet retail businesses, we provide a wide range of services for business set-up and the management of growth and expansion endeavours. Here, our services cover conducting market research, developing business models, writing business plans, formulating functional strategies, defining SOPs, identifying the business-IT requirements, SOP-IT integration, assistance in franchise adoption and management, and planning audit programs.

Formulation of Functional Strategies

To make the enterprise-level strategies work, it is important to have the right strategies at the level of each business function. For example, if a company intends to create and maintain certain standards in customer experience, there must be relevant adaptations in different departments like HR (for hiring the right people and training them), finance (to plan and allocate the necessary budget), IT (to add the necessary back-end and front-end features), and so on.

We help businesses build this framework of functional strategies. Our experience lends us a meaningful understanding of the ramifications of enterprise-level goals and objectives at the level of each business function.

Location Feasibility Analysis

The importance of location in retail needs no separate highlight. What is important to retain is not undermining the significance of carrying out location feasibility analysis. Location decisions can no longer be based on a long list of rough ideas.

The same level of seriousness applies to eCommerce entities as well. Order fulfilment is the essence of eCommerce. Online brands and businesses with their own/outsourced channel capabilities must take into account the factors affecting the efficiency and effectiveness of replenishment, shipping, and order fulfilment in shaping and finalising their location-related decisions.

In location feasibility analysis, we work on the relevant considerations from the start. Here’s a broad coverage of what we seek to answer/analyse in location feasibility analysis concerning both brick-and-mortar and eCommerce in ways applicable:

· How easily customers can access the store
· How efficiently home delivery services could be completed
· How quickly inventory replenishment could be done
· How easily employees and service providers can reach the store/workspace
· Charges of leasing/renting a commercially striking space
· Achieving branding objectives
· Ability to capture market share (avoidance of market saturation)
· Alignment with community engagement

Layout Planning

Until a decade ago, the pet retail market was not big enough to justify large-format stores. The attention to the visual and layout aspects of stores was not as intense as it is today. As the market grew in spread and volume, pet retail brands and businesses began to invest more in visual merchandising and store layout planning. Today, pet retail businesses are coming up in large formats with due attention to appearance, experience, and efficiency.

In pet store layout planning services, YRC incorporates the best industry standards and practices into proven solutions and strategies for store layout planning with an eye on achieving attractive visual appeal in stores, superlative customer experience, and operational excellence.

SOP Manuals | SOP-IT Integration

As experienced SOP consultants, YRC stresses that in contemporary retailing, cutting across industries, the quality of operations planning is not confined to mere operations. It also has ramifications on customer acquisition and retention, customer experience, profitability, and the quality of operational preparedness to support growth and expansion in the future.

Defining SOPs and implementing them is one of our core competencies. We maintain that while SOPs can streamline and optimise operations, the essence of having an SOP-based operations framework is to become process-oriented.

We also assist in identifying the best-fit business-IT solutions for business process management followed up with SOP-IT integration. We help clients in the vendor search and selection process and secure the necessary coordination with the selected vendor(s) in customising and deploying the IT solutions.

For more information on Pet Store Standard Operating Procedures (SOPs), please visit YRC’s website.

Financial and Commercial Planning

Financial and commercial planning gives a numerical understanding of whether or how a business idea or any big business decision (e.g. expansion) will fare. It is an attempt to foresee an anticipated business future with numbers, financials, statistics, accounting, ratios, or any other relevant method.

With over 10 years in business, YRC is well-versed in the standard and strategic facets of financial and commercial planning in retail and eCommerce where we cover:

· Valuation of capital requirements and operating expenditure
· Demand projection
· Sales and revenue projection
· Estimation of cash flow
· Estimation of profit and loss
· ROI and break-even analysis
· Calculation of relevant financial ratios

Franchise Consulting

Small and medium pet retail and distributor businesses have good reasons for associating with renowned pet product brands. Their businesses get immediate recognition which helps them quickly attract customers in local and regional markets. However, franchising is no longer an easy-peasy walk. There is also competition among franchisee stores. There are also price wars between franchisees where the scope of tweaking price margins is already low. Besides, there is always this big task of being able to formulate a successful franchise working arrangement. In the event of things not turning out as intended, exiting a franchise can be more difficult than wrapping up one’s own business.

In pet franchise consulting services, we stress that it is critical to be able to see through the whole project from beginning to end, from the idea to having a smooth run.

We assist pet retail brands and businesses to develop a sound working model for their franchise idea to get to work covering these vital areas of work:

· Franchise expansion strategy
· Franchise business model development
· Franchise business plan
· Franchise associate selection
· Franchise operations planning (Franchise SOPs)
· Franchise agreements

Dive Deeper
Explore YRC’s resource repository for advanced information on retail and eCommerce management challenges, solutions and more:

FAQs

How can I make my pet retail store more competitive against big brands?

Small retail businesses often undermine that they have the advantage of better knowledge of local markets and buyer/consumer behaviour. This is a front you should seek to extract the most from in the form of localisation. You can customise your offerings to suit the local demand.

The next front is personalisation. As a local business, you also have the advantage of direct exposure to customers. You may even know your regular customers by their names. If you begin observing and noting, you can have profound insights for coming up with personalisation and CX strategies.

Where do I start eCommerce for my pet retail store?

Start with your eCommerce strategy – define why you are adopting eCommerce, what business goals and objectives you want to achieve, who your target demographics are, what products will you offer via eCommerce, how will you manage the delivery and shipping, how you will manage the additional space requirements, what about customer service, financial planning, and other important considerations.

The next factor is choosing a suitable eCommerce platform. There are many renowned service providers available in the market. In selecting the right platform, you should consider platform features, costing, ease of use for both you and your customers, technical support systems, legalities, scalability, etc. The eCommerce platform is a cloud-based service which you will use as your online storefront and back-end eCommerce process integrations. Alternatively, you can develop and host your own eCommerce website. Think of an eCommerce platform as an empty physical place (with the desired features and functionalities) for your store.

After you have an eCommerce platform/website, it will be time to work on some of the important surface-level and front-end features of your online store. This involves the listing of products, adding the payment gateways, configuration of shipping charges and taxes, securing regulatory compliances, account management, order management, integration of customer support systems, and other features as applicable.

With this basic arrangement, you will be good to go. You can kick off your digital marketing efforts at this stage.

Pet Retail Industry