The Pet Industry: Food, Accessories, Health Products & Services
In 2005, Americans spent over $35 billion on pet supplies and services. This figure is projected to approach $37 billion in 2006 and surpass $43 billion by 2011, an average annual growth rate (AAGR) of 3.4% from through 2011.
Pet food is the largest segment of the market, with sales of $14.7 billion (42% of the total market) in 2005. Sales of pet food are projected to increase at a slightly slower rate than the market as a whole, and as a result their market share is expected to slip to less than 41% by 2011.
Non-food pet supplies such as litter, toys and over-the-counter medicines) are the fastest-growing segment of the market, with a projected AAGR of 6.1% over the next five years. As a result, non-food pet supplies' share of the market is projected to grow from 25% in 2005 to 27% in 2011.
The pet industry is a major segment of the U.S. economy. In 2005, American pet owners spent over $35 billion on their small companions, and in 2006, this figure is expected to approach $37 billion. Recent growth in all segments of the pet industry has provided an opportunity for both existing players and new entrants. A growing number of players as well as consolidation among manufacturers, retailers, and service providers, and globalization of the American economy have transformed the maturing pet industry into a dynamic, highly competitive environment. This BCC Research report analyzes these new developments and their potential impact on the future of the pet industry.
SCOPE OF STUDY
This report contains:
- An introduction and overview of the pet industry in the United States, including detailed definitions and explanations of the industry as it stands today
- Detailed analysis of the U.S. pet industry market, including a five-year market forecast through 2011
- Analysis of market trends and developments
- Review of recent technology
- A discussion of markets, trends, and technology on a global level
- Profiles of the major companies in the industry and a patent analysis.
METHODOLOGY AND INFORMATION SOURCES
BCC analyzed historical growth trends in the U.S. pet population, and developed a simple pet demographic model to projects future population trends. BCC also analyzed historical trends in the market for pet care products and services in the context of pet population trends and other variables, such as economics, consumer trends, competition and price pressures. Based on its analysis, BCC projected the future market for each major segment and sub-segment of the U.S. pet care industry through 2011.
The data on which these projections are based are, in some cases, open to different interpretations. Therefore, BCC has made a point of documenting its analytical assumptions and methodologies as explicitly as possible, in order to enable readers to evaluate them and test the impact of substituting alternative assumptions.
In preparing this report, BCC obtained and analyzed information from trade and mainstream publications, industry and pet ownership surveys, company directories and databases, annual reports, and government sources. The U.S. Government Census, Consumer Expenditure Surveys from Bureau of Labor Statistics, and U.S. Department of Commerce provided demographic, consumer expenditure trends, and foreign trade data. Personal interviews were conducted with representatives from major companies, U.S. trade associations and publications, industry experts, and government officials. Foreign government offices, trade associations, and trade publications were contacted for information on international markets.
This report is an update of an earlier report prepared by Julia Dvorko, a BCC analyst. The analyst responsible for updating the report is Andrew McWilliams, a partner in the Boston-based international technology and marketing consulting firm, 43rd Parallel LLC. Mr. McWilliams is the author of a number of other BCC consumer-oriented market studies, including The Digital Home Entertainment Revolution: Technology Enablers (SMC058A); Materials and Devices for High-Performance Sports Products (AVM053A); Nanotechnology for Consumer Products (NAN037A); Smart and Interactive Textiles (AVM050A); and Evolving Nutraceutical Business (FOD013A).
In 2003, Americans spent nearly $30 billion on their pets. Growing at an average annual rate (AAGR) of 3.9%, the market for pet care will reach almost $36.3 billion by 2008.
Pet foods, growing at an AAGR of 3.6% through 2008, will remain the largest segment, representing about 46% of the market.
Veterinary services will demonstrate the fastest growth at an AAGR of 4.7% through 2008, and the segment will increase from $7.8 billion in 2003 to $9.8 billion.
Expenditures on other pet services, such as grooming, training, breeding and pet sitting, will grow more slowly, at an AAGR of 3.4% to $2.7 billion in 2008.
In 2000, Americans were expected to spend over $27 billion on their pets. Growing at an average annual rate (AAGR) of 4.3%, this market will reach $33.5 billion in 2005. These expenditures included $12.8 billion spent on pet food, about $9 billion spent on pet services and over $5 billion spent on pet supplies
Pet foods, growing at an AAGR of 4.2% through the period, will remain the largest segment, representing over 47% of the market. Veterinary services will grow at an AAGR of 4.5% through 2005, from $7 billion in 2000 to nearly $8.8 billion. Expenditures on pet supplies is the fastest growing, at an AAGR of 5%.
Exports of U.S. produced pet products will grow at an AAGR of 4.8% to nearly $1 billion in 2005.
The pet industry is expected to grow at 4.3% annually to reach $33.5 billion by the year 2005, with pet supplies leading the growth.