Owning a pet store can be a profitable business. The market size is projected to grow 5% every year till 2028. That means there is still room for new businesses, including yours, despite the competition.
Revenue and Profitability
According to industry data, the average annual revenue for a pet store business is around $1 million to $2 million. This figure takes into account both small, independently-owned pet stores and larger, franchise-operated pet store chains. Revenue is influenced by location, as stores in densely populated areas with more pet owners generate more sales.
Premium pet foods can cost as much as $6,000 a packet. The average net income is $30,000. Profit margins on pet food are around 13-15% annually. So starting an online pet store can be profitable if you target the right audience.
Growth and Expansion
By choosing the right location, you can establish a profitable and successful pet store. In the early stages, you may want to run your business from home to keep costs low. But as your business grows, you’ll likely need to hire workers and rent a storefront.
Pet stores have proven to be profitable even during recessions. The market size is $103 billion. Considering the initial investment is $10K and potential revenue is $11.1 million per year with gross margins being 40%, there’s money to be made.
Pros of Investing in a Pet Store
- Profit Margins: The average profit margin on pet products is 30% to 40%. If you develop a niche, you could see margins of 50%.
- Growing Market: Almost 86 million households have one or more pets.
- Annual Sales: On average, a pet store operated by four people makes about $400,000 in sales per year.
Additional Benefits
- High Profitability: Pet food manufacturers are experiencing high profitability as pet owners continue to purchase special food formulations.
- Customer Interaction: Pet store owners interact daily with pet owners and provide pet care support services.
- Average Spending: Pet owners spend an average of $254 per year for dog food and $220 per year on cat food.
While it’s not easy building a pet store from scratch, with the right tools and knowledge, starting a pet store can be more achievable than you think.