Few businesses have seen more expansion than the pet business in recent years. As pet owners increasingly treat their cats, dogs and small furry animals like members of the family, sales for luxury pet services, wellness products and apparel are exploding. According to the American Pet Products Association, last year Americans spent $60 billion on their pets, with more expensive, healthier food accounting for the largest part, at upward of $22 billion—a figure that's more than doubled since 2000.
But fancy organic food is just the beginning. Those who have decided to cash in on this ever growing market are offering everything from yappuccinos to pet weddings.
Here is a look at some of the entre-pawneurs who have made it big in the pet economy. They appear to be barking up the right tree.
—By Barbara Booth
Posted 10 April 2015
Lori Weiner had a vision: to open a boarding facility for pets where they could have all the comforts of home. So in 2011 she launched Barkingham Palace, The Pet Hotel Resort and Spa, a Palm Desert, California-based boarding and grooming facility for birds, cats and dogs that offers the same amenities as a five-star hotel for humans. Her mantra: "You go on vacation. Why shouldn't your pet?"
At the palace, every pet receives the all-star treatment. There's a gym, warm-water pool therapy, Jacuzzi, Pawlates, treadmills, a full-service salon that offers mud baths, essential oil massages, hydrating facials and more. After a full day of exercise, dogs can relax and enjoy a movie on a flat-screen TV. Owners, meanwhile, can watch their pets rest and play via webcam. The hotel has 38 suites in varying levels of luxury for dogs, which can run as high as $95 per night, as well as large birdcages and cat condos.
And if Fido plans to get married anytime soon, Barkingham Palace offers a complete wedding package for $475.
Barkingham's first-year revenue was $220,000. Now, four years later, the luxury hotel's revenues have surged to between $1 million and $1.5 million per year, with about 1,500 guests checking in each month. Plans are to franchise the concept later this year.
After his natural-beverage company, Clear Day, went belly-up in 2003, Marco Giannini came up with the idea of Dogswell—a premium pet-food company committed to making dog treats infused with nutrients to enhance their lives. He invested $30,000 of his own money to manufacture and package the first truckload of product and drove around to pet stores in California to pitch his nutritious pet snack, called Happy Hips, which he said helped fight conditions such as arthritis and hip dysplasia.
By the time Giannini sold the company in 2008, Dogswell had 21 employees and was listed at No. 101 on the Inc. 500 list and was bringing in an annual revenue of $17 million. (Today the company has swelled to 50 employees and nine varieties of treat lines but would not disclose annual sales.)
With more than 70 million dogs in the U.S., it's no wonder that pet waste removal businesses are starting to "poop" up everywhere, all with the clever names to make light of this "unglamorous" service. In the past few years, start-ups Doody Calls, Wholly Krap and Scoopy Doo have all come on the scene. But the first was Pet Butler, founded in 1988 by Matt Osborn in Columbus, Ohio.
After an initial investment of $150 for tools, flyers, business cards and a few local classified ads, the company quickly grew to seven employees, a client list of 700 regular customers and a fleet of six trucks. In 1998 he sold Pet Butler to Matt "Red" Boswell, a college grad, who moved the company to the Dallas/Fort Worth area. The client list grew exponentially over the next several years, and in 2005 Boswell began franchising.
Today, Pet Butler is the largest pet waste removal company in the country, with 124 locations in 24 states, serving 7,000 single-family homes and 24,000 customers in multifamily neighborhoods. On its website the company keeps track of the number of poops it's scooped, which at press time came to 20,829,909.
What does all that "business" mean for Pet Butler? Just short of $9 million in annual revenue.
After going into debt to pay a $5,000 bill for their sick cat, husband-and-wife team Chris and Natasha Ashton saw a huge opportunity: to provide insurance to the more than 160 million dogs and cats in the U.S. But in an industry plagued by inadequate products, the Ashtons—both Wharton School of Business grads—knew they needed to establish a strong brand built around their core value—that "pets come first."
The couple took their business plan to the world's largest and oldest pet insurance company in the world—Petplan UK—and asked the company to partner with them to make a success of the U.S. market. By offering full coverage for genetic and chronic conditions as standard and being the only provider to offer a Covered for Life guarantee, Petplan USA stood out from other plans in the industry and quickly saw explosive growth in its customer base. In 2008, angel investors sunk $2.6 million into the company.
The company—included on Inc. Magazine's list of 500 fastest-growing, privately held companies in America—currently insures close to 150,000 pets and has 150 employees. In 2014, Petplan USA's annual revenue was $69.2 million, up 30 percent over the previous year.
Doggles, protective eyewear for dogs, is the mastermind of Roni and Ken DiLullo, who were inspired with the idea after they noticed their dog, Midnight, squinting in the sunlight. To ease his sun sensitivity, Roni customized a pair of sports goggles for him. So many people were amused with the idea, Roni created a website that featured Midnight sporting his eyewear—and received numerous requests from dog owners asking her to make a pair for their dogs.
Unable to keep up with the demand, Roni and Ken contracted with a Taiwanese manufacturer, who agreed to make the protective eyewear specifically for dogs. Ranging from $13.99 to $22.99, Doggles are designed with shatterproof and antifog polycarbonate lenses to protect canines from UV rays. They come with adjustable elastic head and chin straps and padded frames for a comfortable fit, and some even come with prescription lenses.
Ranked sixth by MSN Money in a list of "10 ideas that shouldn't have worked—but made millions," the Diamond Springs, California, company has now expanded into fashion and toys for both dogs and cats and sells its products online and in more than 16 countries.
After creating Rover Kennels in Los Angeles in 2001—the go-to boarding facility frequented by such celebrities as Tom Cruise and Kelly Clarkson that grossed more than $750,000 in the first year alone—master dog trainer and dog business expert Jaime Van Wye decided she wanted to create a dedicated indoor space for urban dogs to train, socialize and shop.
In 2007 she opened the first Zoom Room, in Los Angeles. The company began franchising at the end of 2009, growing the concept that the Zoom Room "does not train dogs; it trains the people who love them."
And the dog owners appear to enjoy it. Zoom Room currently has a total of 18 locations—14 franchised and four company-owned stores. Three additional locations will open in 2015, in Virginia Beach, Virginia; Trophy Club, Texas; and in downtown Los Angeles. In 2014, Zoom Room locations nationwide brought in more than $5.5M in revenue.
All it took were three dogs, two guys and a love of canines to inspire Mark Beckloff and Dan Dye to open Three Dog Bakery, one of the first bakeries exclusively for dogs. This Missouri-based company has been baking fresh, all-natural, nutritious dog treats since 1989, after Mark and Dan became dismayed by all of the additives in commercial dog treats they were feeding their lovable companions: Dottie, Gracie and Sarah. So Dan and Mark quickly took matters into their own kitchen. When word got out about the delicious treats, Dan and Mark couldn't keep up with demand. They quit their "real" jobs and opened Three Dog.
The company has approximately 40 gourmet bakeries across the U.S., Canada and Hong Kong, and 10 more are scheduled to open this year. Their products are sold in pet stores and online retailers, such as Kroger, Pet Supplies Plus, Target and Wal-Mart. The company averages between $10 million and $15 million in annual sales.
In addition, Beckloff and Dye have unleashed two Three Dog Bakery cookbooks, featuring a number of their salivating recipes.
Care for a Grande Yappuccino?
CEO and creative director Maria Peevey launched SimplyShe in 1999 with the idea of creating products based on the everyday experiences in women's lives. She started with themed greeting cards, which quickly expanded into paper goods, books, journals and a clothing line. But in 2004, Peevey suddenly realized the untapped opportunity for pet fashions and accessories—and SimplyDog was born. A year later she pitched her new line to Petco and then retail giant Wal-Mart.
Sales for SimplyDog's fashion and accessory line grew so quickly, Peevey decided to launch SimplyShe for Cats and SimplyShe for small animals. The company, which operates out of San Francisco, now has more than 20 pet brands for dogs, cats and small animals, including "Wag-a-Tude," "Fab Cat" and "Small Furries." Annual revenues today total $50 million.
Perhaps someday, Peevey said, the company will be outfitting horses.