There are many reasons why some companies work and some don’t, but one of the most important factors is choosing the right industry at the right time. One of the areas that many investors are wagering on is the pet industry for six reasons.
1. Its recession-proof
Some time ago, someone asked Wallet Alexis Perak is, former CEO of L’Oreal in Germany and now a member of the Global Governance Commission, why he chose the cosmetics industry. He said that there were many reasons for this but one important reason was to choose an industry that could withstand the slowdown.
Since then I have analyzed that the particular sector in which I can start a business is safe from recession. The pet industry seems to be ignoring all the obstacles of the recession so far with little effect from the economic crisis. An excerpt from Google Trends about dog and cat toys as you can see, the demand is stagnant and so is the demand for dogs
2. It is imprecise.
Every businessman and investor’s nightmare is running a seasonal business. Seasonal demand limits cash flow to two weeks a year, so it is important to track future demand estimates. Needless to say, this is not ideal. However, there is a difference between seasonal products and relatively expected demand. That is the seasonal peak. The forecast is higher than the high demand for Halloween (like a costume shop) or Christmas (like a Christmas tree maker). This is because the risk of overstocking is reduced and long term planning is possible. As seen in Google Trends Traffic, the pet industry boomed in December, but basic demand remains strong throughout the year.
3. Customers do not need to be trained
If you are a fan of Shark Tank or Dragon Dan, you know that some of the most advanced products and services are not funded. This is because the biggest expense is to make consumers aware of the features and importance of the product.
4. Industrial benefits of kindergarten.
Ethnologist and biologist Conrad Lorenz researches which features make things beautiful. This set of features is now known as the so-called pets sketch. It represents the ratio of head to body, eye position (below the midline of the head) and eye to head size. Way of thinking
A type of circuit is programmed to make something beautiful. One of the reasons why many businesses and investors find baby food and pet food attractive is that these sectors benefit greatly from the kindergarten system.
5. Good profit
For retail you need an average margin of at least 60%. The margin for feeding most dogs and cats is about 50%, while the margin for most popular products such as chewing gum and bones is 70%. Pet food accounts for more than a third of the total market, with 23 23.04 billion spent annually on pet food. Designer necklaces, fancy dresses and other standard dog accessories also have large margins to maintain a high average margin.
6. Growing market
Pet products are attractive not only to retailers but also to the service industry. Demand has increased in recent years as the number of pets has increased to 312.1 million. The market volume has more than tripled since 1994, from 17 billion units in 2015 to more than 60 billion in the United States alone. This means that not only will more pets be eaten, walked, entertained, cared for and cared for, but pet owners will continue to spend money.