Growth of the Pet Industry

PetSmart's PetsHotels Are a Growing Niche Industry

By Paradigm, published Jan 08, 2007
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The growth of leading U.S. pet-tailer PetSmart, is an indication of dogs' growing clout in this country as just another member of the family - even if they aren't human like the rest of the family.

Since 2000, the pet industry has seen a 36 percent increase in sales which amounts to about $45 billion each year. Most of the money for the industry comes from services such as grooming or training as well as pet hotels. These services are now even more popular than the simple purchase of pet toys or food at PetSmart stores.

In cashing in on this trend, PetSmart has increased the number of its fancy pet hotels, called PetsHotel. The company currently has 62 locations open but plans on increasing that number to 435 locations.

The pet hotel stay can cost upwards of $21 each night depending on the services rendered and the type of room and board the owner wants to pay for.

The cheapest lodging is the standard, which costs $21 each night and includes a cage with blankets and a padded bed.

The suite, a four-foot by seven-foot space costs $31 each night and includes elevated dog beds and a TV. Pets are able to watch Walt Disney movies such as 101 Dalmations or Lady and the Tramp.

In the event that the pets or owners miss each other, the hotels also offer a Bone Booth option. This is basically the opportunity for the owner to talk to the pet over the phone and 40 percent of customers actually use this option.

In addition to the rooms, pets are also fed ice cream treats ($3 each), which is lactose-free and fat-free. While all of this may seem absurd to some people, the company's sales indicate something else: success.

The 2005 sales of the PetsHotel was around $16.7 million - a huge jump from the $8.7 million in sales from 2004.

Dogs, cats and other types of pets have always been important members of the family in many households, but are the pet hotels taking it too far? It used to be that dog kennels were the norm if a family went on vacation and needed a place for their pet to stay while they were away. However, now, these basic kennels have been replaced with luxury.

Takeaways
  • The pet industry has grown 36% since 2000
  • The pet industry is a $45 billion per year industry
  • PetSmart stores have seen revenue increase about 27% each year for the past six years
Did You Know?
There are 909 PetSmart stores in the U.S.
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