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WWW.IBISWORLD.COM Pet Stores in the US December 2012 1
IBISWorld Industry Report 45391
Pet Stores in the USDecember 2012 Caitlin Moldvay
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2 About this Industry
2 Industry Definition
2 Main Activities
2 Similar Industries
2 Additional Resources
3 Industry at a Glance
4 Industry Performance
4 Executive Summary
4 Key External Drivers
5 Current Performance
8 Industry Outlook
11 Industry Life Cycle
13 Products & Markets
13 Supply Chain
13 Products & Services
14 Demand Determinants
15 Major Markets
16 International Trade
17 Business Locations
19 Competitive Landscape
19 Market Share Concentration
19 Key Success Factors
20 Cost Structure Benchmarks
21 Basis of Competition
22 Barriers to Entry
23 Industry Globalization
24 Major Companies
24 PetSmart Inc.
25 PETCO Animal Supplies Inc.
28 Operating Conditions
28 Capital Intensity
29 Technology & Systems
29 Revenue Volatility
30 Regulation & Policy
31 Industry Assistance
32 Key Statistics
32 Industry Data
32 Annual Change
32 Key Ratios
33 Jargon & Glossary
www.ibisworld.com | 1-800-330-3772 | info@ibisworld.com
WWW.IBISWORLD.COM Pet Stores in the US December 2012 2
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WWW.IBISWORLD.COM Pet Stores in the US December 2012 3
Mil
lio
ns
200
140
150
160
170
180
190
1703 05 07 09 11 13 15Year
Number of pets (cats and dogs)
SOURCE: WWW.IBISWORLD.COM
% c
ha
ng
e
10
4
2
0
2
4
6
8
1804 06 08 10 12 14 16Year
Revenue Employment
Revenue vs. employment growth
Products and services segmentation (2012)
52.1%Pet food
31.9%Pet supplies
10.5%Pet services
5.5%Live animals
SOURCE: WWW.IBISWORLD.COM
Key Statistics Snapshot
Industry at a GlancePet Stores in 2012
Industry Structure Life Cycle Stage GrowthRevenue Volatility Low
Capital Intensity Low
Industry Assistance None
Concentration Level Medium
Regulation Level Medium
Technology Change Medium
Barriers to Entry Medium
Industry Globalization Low
Competition Level Medium
Revenue
$14.7bnProfit
$516.1mWages
$2.0bnBusinesses
13,613
Annual Growth 12-17
3.8%Annual Growth 07-12
2.8%
Key External DriversNumber of pets (cats and dogs)
Per capita disposable income
External competition
Number of households
Market Share
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FOR ADDITIONAL STATISTICS AND TIME SERIES SEE THE APPENDIX ON PAGE 32
SOURCE: WWW.IBISWORLD.COM
WWW.IBISWORLD.COM Pet Stores in the US December 2012 4
Key External Drivers Number of pets (cats and dogs)H1&
WWW.IBISWORLD.COM Pet Stores in the US December 2012 5
Industry Performance
Growth during the recession
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Industry Performance
Growth during the recessioncontinued
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Industry Performance
Product innovation ?/&IJJK:&6,3762/,T#(/-762/7-,'&'()&7/'-&9(('&0,5(0-,'3%"1,'&-
WWW.IBISWORLD.COM Pet Stores in the US December 2012 8
Industry Performance
Industry Outlook
E
WWW.IBISWORLD.COM Pet Stores in the US December 2012 9
Industry Performance
Industry Outlookcontinued
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Industry Performance
Changing competitioncontinued
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WWW.IBISWORLD.COM Pet Stores in the US December 2012 11
Industry PerformanceE
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Industry Performance
Industry Life Cycle E-(0,1&2/'"1-0%&21&2/&7&)0(.-
WWW.IBISWORLD.COM Pet Stores in the US December 2012 13
Products & Services
Pet food
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WWW.IBISWORLD.COM Pet Stores in the US December 2012 14
Products & Markets
DemandDeterminants
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WWW.IBISWORLD.COM Pet Stores in the US December 2012 15
Products & Markets
Major Markets
E
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Products & Markets
International Trade ?/-,0/7-2(/73&-07',&7#-242-%&21&7##("/-,'&7-&-
WWW.IBISWORLD.COM Pet Stores in the US December 2012 17
Products & Markets
Business Locations 2012
MO1.9
WestWestWestWestWest
West
West
Rocky MountainsMountainsMountainsMountainsMountainsMountainsMountainsMountainsMountainsMountainsMountainsMountainsMountainsMountainsMountainsMountainsMountainsMountains PlainsPlainsPlainsPlainsPlainsPlainsPlains
SouthwestSouthwestSouthwestSouthwestSouthwestSouthwestSouthwestSouthwestSouthwestSouthwestSouthwestSouthwestSouthwestSouthwestSouthwest
SoutheastSSoutheastSoutheastSoutheastSoutheastSoutheastSoutheastSoutheastSoutheastSoutheastSoutheastSoutheastSoutheastSoutheastSoutheastSoutheastSoutheastSoutheastSoutheastSoutheastSoutheastSoutheastSoutheastSoutheastSoutheast
New EnglandgEngland
VT0.3
MA2.0
RI0.5
NJ3.3
DE0.5
NH0.7
CT1.5
MD1.9
DC0.1
1
5
3
7
2
6
4
8 9
Additional States (as marked on map)
AZ2.2
CA13.2
NV0.9
OR2.0
WA3.1
MT0.3
NE0.5
MN1.7
IA0.9
OH3.9
VA2.7
FL7.7
KS0.9
CO2.6
UT0.7
ID0.5
TX5.6
OK0.9
NC2.5
AK0.2
WY0.3
TN1.5
KY0.7
GA2.2
IL4.1
ME0.6
ND0.2
WI1.9 MI
3.5PA4.4
WV0.3
SD0.2
NM0.6
AR0.5
MS0.4
AL1.0
SC1.3
LA1.0
HI0.4
IN2.0
NY7.4 5
6
78
3
21
4
79
SOURCE: WWW.IBISWORLD.COM
t
Mid-
AtlanticAtlanticAtlanticAtlantic
Establishments (%)
Less than 3%
3% to less than 10%
10% to less than 20%
20% or more
Great
Lakes
WWW.IBISWORLD.COM Pet Stores in the US December 2012 18
Products & Markets
Business Locations +,-&>-(0,1&70,&50267023%&3(#7-,'&2/&-("-
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Key Success Factors Attractive product presentation?/&(0',0&-(&'07."1-(6,01&7/'&,/#("07),&5"0#
WWW.IBISWORLD.COM Pet Stores in the US December 2012 20
Competitive Landscape
Cost Structure Benchmarks
Profit
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WWW.IBISWORLD.COM Pet Stores in the US December 2012 21
Competitive Landscape
Basis of Competition [",&-(&6,'2"6&87002,01&-(&,/-0%&7/'&)0(.2/)&50(;-78232-%&90(6&50,62"6&50('"#-1&7/'&1,042#,1:&-
WWW.IBISWORLD.COM Pet Stores in the US December 2012 22
Competitive Landscape
Barriers to Entry i2)
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Competitive Landscape
Industry Globalization
E
WWW.IBISWORLD.COM Pet Stores in the US December 2012 24
Player Performance >2/#,&2-1&,1-78321
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Major Companies
Player Performance D1-78321&(5,07-2(/1&21&,S5,#-,'&-(&2/#0,71,&7-&7/&74,07),&7//"73&07-,&(9&K=BC&-(&Lc=@&82332(/=&H1&-"#
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Major Companies
Other Companies +,->670-&7/'&+DEFG&70,&-
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Major Companies
Other Companiescontinued
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Capital Intensity E-(0,1&2/'"1-0%:&1262370&-(&6(1-&(-
WWW.IBISWORLD.COM Pet Stores in the US December 2012 29
Operating Conditions
Revenue Volatility +,-&1-(0,1&1,33&'21#0,-2(/70%&P,=)=&5,-1&7/'&-(%1Q&7/'&/(/'21#0,-2(/70%&50('"#-1&P,=)=&5,-&9(('Q=&`
WWW.IBISWORLD.COM Pet Stores in the US December 2012 30
Operating Conditions
Regulation & Policy E
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Operating Conditions
Industry Assistance E-(0,1&2/'"1-0%&'(,1&/(-&0,#,24,&7/%&15,#2;#&)(4,0/6,/-&1"55(0-:&2/&-
WWW.IBISWORLD.COM Pet Stores in the US December 2012 32
Key StatisticsRevenue
($m)
Industry Value Added
($m)Establish-
ments Enterprises Employment Exports ImportsWages ($m)
Domestic Demand
Number of Pets - Cats and Dogs
(Million)
2003 10,234.7 1,987.3 15,835 13,790 88,620 -- -- 1,441.3 N/A 143
2004 11,064.5 2,102.1 16,541 14,213 90,933 -- -- 1,512.5 N/A 153
2005 11,486.7 2,078.9 16,813 14,483 98,384 -- -- 1,469.9 N/A 163
2006 11,925.2 2,330.0 17,130 14,558 101,237 -- -- 1,690.0 N/A 154
2007 12,872.9 2,400.4 17,638 14,804 109,870 -- -- 1,813.8 N/A 163
2008 13,246.2 2,442.9 17,110 14,115 106,460 -- -- 1,818.9 N/A 165
2009 13,338.9 2,516.9 16,650 13,632 109,167 -- -- 1,816.3 N/A 171
2010 13,712.4 2,604.2 16,502 13,305 105,327 -- -- 1,865.3 N/A 165
2011 14,164.9 2,701.9 16,651 13,411 107,749 -- -- 1,915.7 N/A 169
2012 14,745.7 2,803.5 16,867 13,613 110,443 -- -- 1,975.9 N/A 173
2013 15,424.0 2,920.2 17,137 13,817 113,867 -- -- 2,049.0 N/A 177
2014 16,102.7 3,040.9 17,480 14,093 118,991 -- -- 2,140.4 N/A 181
2015 16,730.7 3,137.3 17,847 14,347 123,379 -- -- 2,225.2 N/A 185
2016 17,098.7 3,252.0 18,257 14,662 126,957 -- -- 2,283.5 N/A 189
2017 17,799.8 3,319.5 18,750 15,014 131,522 -- -- 2,370.2 N/A 193
Sector Rank 46/119 42/119 46/119 41/119 44/119 N/A N/A 47/119 N/A N/A
Economy Rank 441/1149 571/1149 247/1148 239/1148 302/1149 N/A N/A 503/1149 N/A N/A
IVA/Revenue (%)
Imports/Demand
(%)Exports/Revenue
(%)
Revenue per Employee
($000)Wages/Revenue
(%)Employees
per Est.Average Wage
($)
Share of the Economy
(%)
2003 19.42 N/A N/A 115.49 14.08 5.60 16,263.82 0.02
2004 19.00 N/A N/A 121.68 13.67 5.50 16,633.13 0.02
2005 18.10 N/A N/A 116.75 12.80 5.85 14,940.44 0.02
2006 19.54 N/A N/A 117.79 14.17 5.91 16,693.50 0.02
2007 18.65 N/A N/A 117.16 14.09 6.23 16,508.60 0.02
2008 18.44 N/A N/A 124.42 13.73 6.22 17,085.29 0.02
2009 18.87 N/A N/A 122.19 13.62 6.56 16,637.81 0.02
2010 18.99 N/A N/A 130.19 13.60 6.38 17,709.61 0.02
2011 19.07 N/A N/A 131.46 13.52 6.47 17,779.28 0.02
2012 19.01 N/A N/A 133.51 13.40 6.55 17,890.68 0.02
2013 18.93 N/A N/A 135.46 13.28 6.64 17,994.68 0.02
2014 18.88 N/A N/A 135.33 13.29 6.81 17,987.92 0.02
2015 18.75 N/A N/A 135.60 13.30 6.91 18,035.48 0.02
2016 19.02 N/A N/A 134.68 13.35 6.95 17,986.40 0.02
2017 18.65 N/A N/A 135.34 13.32 7.01 18,021.32 0.02
Sector Rank 49/119 N/A N/A 86/119 49/119 45/119 90/119 42/119
Economy Rank 937/1149 N/A N/A 845/1149 746/1149 802/1148 1043/1149 571/1149
Figures are inflation-adjusted 2012 dollars. Rank refers to 2012 data.
Revenue (%)
Industry Value Added
(%)
Establish-ments
(%)Enterprises
(%)Employment
(%)Exports
(%)Imports
(%)Wages
(%)
Domestic Demand
(%)
Number of Pets - Cats and Dogs
(%)
2004 8.1 5.8 4.5 3.1 2.6 N/A N/A 4.9 N/A 7.0
2005 3.8 -1.1 1.6 1.9 8.2 N/A N/A -2.8 N/A 6.5
2006 3.8 12.1 1.9 0.5 2.9 N/A N/A 15.0 N/A -5.5
2007 7.9 3.0 3.0 1.7 8.5 N/A N/A 7.3 N/A 5.8
2008 2.9 1.8 -3.0 -4.7 -3.1 N/A N/A 0.3 N/A 1.2
2009 0.7 3.0 -2.7 -3.4 2.5 N/A N/A -0.1 N/A 3.6
2010 2.8 3.5 -0.9 -2.4 -3.5 N/A N/A 2.7 N/A -3.5
2011 3.3 3.8 0.9 0.8 2.3 N/A N/A 2.7 N/A 2.4
2012 4.1 3.8 1.3 1.5 2.5 N/A N/A 3.1 N/A 2.4
2013 4.6 4.2 1.6 1.5 3.1 N/A N/A 3.7 N/A 2.3
2014 4.4 4.1 2.0 2.0 4.5 N/A N/A 4.5 N/A 2.3
2015 3.9 3.2 2.1 1.8 3.7 N/A N/A 4.0 N/A 2.2
2016 2.2 3.7 2.3 2.2 2.9 N/A N/A 2.6 N/A 2.2
2017 4.1 2.1 2.7 2.4 3.6 N/A N/A 3.8 N/A 2.1
Sector Rank 44/119 58/119 64/119 52/119 40/119 N/A N/A 42/119 N/A N/A
Economy Rank 370/1149 481/1149 548/1148 425/1148 365/1149 N/A N/A 392/1149 N/A N/A
Annual Change
Key Ratios
Industry Data
SOURCE: WWW.IBISWORLD.COM
WWW.IBISWORLD.COM Pet Stores in the US December 2012 33
Jargon & Glossary
BARRIERS TO ENTRY High barriers to entry mean that new companies struggle to enter an industry, while low barriers mean it is easy for new companies to enter an industry.
CAPITAL INTENSITY Compares the amount of money spent on capital (plant, machinery and equipment) with that spent on labor. IBISWorld uses the ratio of depreciation to wages as a proxy for capital intensity. High capital intensity is more than $0.333 of capital to $1 of labor; medium is $0.125 to $0.333 of capital to $1 of labor; low is less than $0.125 of capital for every $1 of labor.
CONSTANT PRICES The dollar figures in the Key Statistics table, including forecasts, are adjusted for inflation using the current year (i.e. year published) as the base year. This removes the impact of changes in the purchasing power of the dollar, leaving only the real growth or decline in industry metrics. The inflation adjustments in IBISWorlds reports are made using the US Bureau of Economic Analysis implicit GDP price deflator.
DOMESTIC DEMAND Spending on industry goods and services within the United States, regardless of their country of origin. It is derived by adding imports to industry revenue, and then subtracting exports.
EMPLOYMENT The number of permanent, part-time, temporary and seasonal employees, working proprietors, partners, managers and executives within the industry.
ENTERPRISE A division that is separately managed and keeps management accounts. Each enterprise consists of one or more establishments that are under common ownership or control.
ESTABLISHMENT The smallest type of accounting unit within an enterprise, an establishment is a single physical location where business is conducted or where services or industrial operations are performed. Multiple establishments under common control make up an enterprise.
EXPORTS Total value of industry goods and services sold by US companies to customers abroad.
IMPORTS Total value of industry goods and services brought in from foreign countries to be sold in the United States.
INDUSTRY CONCENTRATION An indicator of the dominance of the top four players in an industry. Concentration is considered high if the top players account for more than 70% of industry revenue. Medium is 40% to 70% of industry revenue. Low is less than 40%.
INDUSTRY REVENUE The total sales of industry goods and services (exclusive of excise and sales tax); subsidies on production; all other operating income from outside the firm (such as commission income, repair and service income, and rent, leasing and hiring income); and capital work done by rental or lease. Receipts from interest royalties, dividends and the sale of fixed tangible assets are excluded.
INDUSTRY VALUE ADDED (IVA) The market value of goods and services produced by the industry minus the cost of goods and services used in production. IVA is also described as the industrys contribution to GDP, or profit plus wages and depreciation.
INTERNATIONAL TRADE The level of international trade is determined by ratios of exports to revenue and imports to domestic demand. For exports/revenue: low is less than 5%, medium is 5% to 20%, and high is more than 20%. Imports/domestic demand: low is less than 5%, medium is 5% to 35%, and high is more than 35%.
LIFE CYCLE All industries go through periods of growth, maturity and decline. IBISWorld determines an industrys life cycle by considering its growth rate (measured by IVA) compared with GDP; the growth rate of the number of establishments; the amount of change the industrys products are undergoing; the rate of technological change; and the level of customer acceptance of industry products and services.
NONEMPLOYING ESTABLISHMENT Businesses with no paid employment or payroll, also known as nonemployers. These are mostly set up by self-employed individuals.
PROFIT IBISWorld uses earnings before interest and tax (EBIT) as an indicator of a companys profitability. It is calculated as revenue minus expenses, excluding interest and tax.
VOLATILITY The level of volatility is determined by averaging the absolute change in revenue in each of the past five years. Volatility levels: very high is more than 20%; high volatility is 10% to 20%; moderate volatility is 3% to 10%; and low volatility is less than 3%.
WAGES The gross total wages and salaries of all employees in the industry. The cost of benefits is also included in this figure.
Industry Jargon
IBISWorld Glossary
HUMANIZATION A trend where pet owners treat pets as humans, providing them with services such as pet hotels and grief counseling.
JUST-IN-TIME (JIT) A strategy implemented to improve profitability by reducing inventory and purchasing the raw materials that are needed for the immediate term only.
PET BOARDING AND DAY-CARE Long- and short-term options for owners who need assistance looking after their pets. Services include feeding, walking, grooming and lodging.
PET PARENTS Pet owners who are enthusiastic about their pets and treat them as members of their family.
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