The steps you take in your franchising journey should be made in confidence starting with the industry you choose. If you are looking to invest in the pet industry, you may question if now is the right time and what the future holds. This is understandable, especially because investing in a franchise can be a major decision for many; you want to feel like the industry you select is suitable for you and will bring long-term success.
Let’s take a deeper look at the pet industry and pet care market to uncover where it currently stands in terms of economic value, where the industry is heading and what is fueling growth. If you are interested in learning more about the pet industry at large, be sure to check out our About the Pet Industry page for further details.
CURRENT VALUE OF THE PET INDUSTRY
Last year, pet industry expenditure in the United States was valued at $123.6 billion. In the previous year, it was valued at $103.6 billion. And in 2019, $97.1 billion. It is evident that there has been a continuous upward trajectory in terms of how much pet parents spend on their pets, even during times with major shifts in shopping behavior and spending.
As for the US pet care market, there has been a similar noticeable growth trend, as it was valued at $46.1 billion in 2021 and $41.3 billion in 2020.
PROJECTED ECONOMIC GROWTH IN THE PET INDUSTRY
A recent report by Morgan Stanley projects that the pet industry will have an 8% compound annual growth rate (CAGR) by 2030 – one of the most considerable rates of return in any retail segment. This means the over hundred-billion-dollar industry will soon reach well into the two hundred billion territory. Part of this success is evident in the amount pet parents are projected to spend on their pets by 2030.
Based on the projections in the report, pet parents will spend increasingly more money on their pets, reaching $1,320 per pet by 2025 and $1,897 by 2030.
The global pet care market, in particular, is also expected to reach new heights with a CAGR of 4.9% in the US between 2022 and 2030 and 5.1% globally in the same timeframe.
WHO IS DRIVING THE GROWTH IN THE PET INDUSTRY?
Pet parents, in general, are the ones we can thank for generating success in the industry. Millennials (people born between 1981 to 1996), in particular, are helping lead the way, as this generation makes up the largest share of pet parents in the US.
In 2022, pet ownership increased the most for millennials compared to other generations, with 32% getting their most recent pet in the last six months. Additionally, 65% of this generation intend to get or will add a pet to their family within the next five years. This helps illustrate and validate how this industry will reach such considerable values as years progress.
Millennials also take the lead in spending, as they outspend other generations on things like pet food and care.
WHAT IS LEADING THIS GROWTH IN THE PET INDUSTRY?
Many factors can go into answering this question, but an element that stands out exists within the generation leading the industry. Many millennials have put the brakes on parenthood, but pet parenthood has been proven to be a different story. Many pet parents in this generation consider their pet a family member as 54% report treating their pet like their child, and 35% put their pet’s needs above their own. This level of care toward a family pet exceeds any other generation.
The humanization of pets is helping to drive the industry toward long-term success, as it is evident that millennial pet parents want to give their pets the best, even if that comes with a higher price tag.
The pandemic also played a role in the growth seen in this industry. Not only did pet ownership rise during the height of the pandemic, but spending on pets increased by 11%.
It is important to note the amount pet parents spend on their pets stays relatively steady, even if other expenses need to change in their own life. In other words, many pet parents do not want to (and will not) limit their pet care spending, even if monetary circumstances change for them. This revelation can be incredibly reassuring business-wise to those within or entering the pet industry, as it helps demonstrate there will continue to be a need for pet services for a long time to come despite recessions or economic uncertainty.
The pandemic impacted how pet parents feel about their pets. According to a study by Money.com, 58% of respondents said they value their pet more than they did prior to the pandemic, while 50% say they are more affectionate toward their pet. Again, this helps showcase how the themes surrounding pets and pet care throughout the pandemic are helping contribute to this momentous industry growth we’ll see throughout the next decade.
A LOOK AT PET DAYCARE AND LODGING
While the pet industry encompasses several facets, there is still significant success to be seen in many of the markets within, particularly the daycare and lodging market. From 2022 – 2026, this market is expected to reach $8.6 billion, a CAGR of 6.34%.
The same factors driving success in the pet industry are fuelling growth in the lodging market, as the increase in both pet ownership and spending corresponds with the need and desire for pet care services, like daycare and lodging.
FRANCHISING IN THE PET INDUSTRY
As indicated through multiple recent reports and studies, the pet industry is not slowing down anytime soon. With more millennials acquiring pets, which equates to even more spending within the various segments in the industry, investing in a pet-focused franchise now can be a great way to enter the market.
Finding a franchise that offers both substantial support and training, as well as multiple streams of revenue is key. Because the pet industry is so expansive, it can be a wise decision to select a franchise business that can easily infiltrate as many markets as possible.
Our business model at Dogtopia includes multiple channels where our franchisees can generate revenue. From daycare to boarding to spa services, as well as subscription/membership-based packages, Dogtopia is approaching the industry from multiple angles while providing pet parents with various services that meet their needs.
If you are interested in learning more about franchising with Dogtopia, check out our detailed FAQ page, where you can learn more about the pet industry, our company, and your investment.