A pet store as a business idea has been especially relevant lately. According to statistics, every second Russian family has some kind of pet. These are not only cats and dogs familiar to us, but also exotic representatives of the fauna.
Animals require special nutrition, care products and accessories, which can only be found in a specialized pet store. In this article, we will try to analyze the nuances in as much detail as possible and draw up a business plan for a pet store with approximate calculations.
Before starting a business, it is necessary to evaluate the idea, in favor of which the following advantages speak :
- Low level of competition
- No seasonal demand factor
- Demand for these goods among the population
- Small initial investment
- Various activities
Business Disadvantages :
- The need to obtain permits
- Low markup on goods 10-40%, in rare cases reaching up to 150%
But the main disadvantage is the purchase prices from corporations like “Mars”, which exceed the retail prices in all Pyaterochkas, magnets, hypermarkets.
Competent planning of organizational moments with financial calculations will help to circumvent the pitfalls and achieve success.
Step by Step Business Plan for Opening a Pet Shop
There are two main options for organizing and running a business:
- Self-organization of business with a full start-up cycle
- Franchise work with support at all stages by a well-known company, but large expenses for its purchase and monthly payments to the franchisor
Let’s consider the first less expensive option , which involves the development of a business plan and its implementation. The sequence of actions will include the following steps:
- Market demand and supply analysis
- Choice of business format
- Determining the range of goods and suppliers
- Selection and repair of premises
- Business registration and personnel search
- Purchase of equipment
- Store marketing strategy
- Planned expenses and profit
- Assessment of possible risks
Let’s start with the first point of the plan and then we will analyze each issue separately.
Demand and competition analysis
This step involves studying the needs of buyers , the range and pricing of the nearest competitors selling pet products. A lot of useful information can be found on the Internet, on thematic forums.
Also, it is necessary to visit the stores of competitors and, as an option, conduct a survey of respondents on topics of interest on the future assortment and preferences.
Even in times of crisis, pet owners rarely save on their maintenance costs, and according to statistics, the growth of the pet products market is 30% annually. The niche is quite free, so it will not be difficult to enter the market.
In the presence of competition , you can stand out with the help of such advantages as:
- Providing advice, additional services that are not available from competitors
- Wider product range
- Implementation of a customer loyalty program
- High level of service
- Flexible pricing policy, which consists in setting average market prices or lower
You should also think about the format of the business . The range of goods and the volume of purchases will depend on this. Can be opened:
- A small department in a shopping center from 15 sq. m.: attracts with minimal investment;
- A highly specialized pet store focused on the sale of a specific group of goods: fish and aquariums, products for dogs, cats, exotic animals, etc. Suitable for large cities;
- A store selling a wide assortment list: allows you to reach a wide target audience, but requires large investments and an area of 50 sq. m.;
- An online store of goods for animals: it is beneficial in terms of the absence of expenses for renting a room and the need to maintain a large staff;
- A large pet store selling animals: will require additional documents and an area of 100 sq. m. Not recommended for novice entrepreneurs.
Choose a format based on financial capabilities and relevance for a particular location.
Focus on the target audience, consisting mainly of:
- people of retirement age with cats and dogs;
- lovers of exotic animals;
- able-bodied population acquiring pets for themselves and their children
We define the assortment and suppliers
Based on the analysis of the market, the main line of the offered assortment is determined. Traditional pet store items include:
- Food of different price range for rodents, cats, dogs, birds, fish
- Vitamins and medicines for animals
- Hair care products
- Accessories and toys
- Various bowls and drinkers
- Various fillers and toilets
- Houses, beds for dogs and cats, cages, aquariums
- Clothing and footwear for animals
When selling animals, it will be supplemented by: parrots, fish, rodents, turtles and others.
Interests are often different :
Do not ask sales representatives of supply chains for advice on the assortment, it is often beneficial for them to “dump” you illiquid assets, which will settle like a dead weight on your shelves.
This is not the whole list. The final assortment will be formed only when the store will work for six months or a year .
Trust but verify :
Sometimes sales representatives will try to sell you a product that you did not order, that is, a product arrives, the seller signs an invoice for quantity, everything converges, but when checking, there are positions that were not ordered. Always check all invoices, at least at the beginning of cooperation! Please send electronic copies of invoices in advance.
Suppliers are easy to find. There are many Russian and foreign manufacturers of pet products on the market. Information about them can be found on the Internet. At the same time, you need to work with reputable suppliers who provide certified goods.
Search and repair of premises
When choosing a place for a retail outlet, they rely on the intensity of pedestrian traffic, the availability of infrastructure, the proximity of transport stops and shops.
The premises can be bought or rented for a long term, depending on the size of the initial investment. In order to save money, the second option is beneficial.
The required area should be 50 square meters. m., divided into several zones:
- Shopping room
- Utility room
- Warehouse for storing products
The room must meet all the requirements and standards of the SES and the fire service, with ventilation, connected communications, lighting, and be located on the basement or first floor of a commercial building.
Expensive repairs are not required , it is enough to carry out cosmetic work with safe finishing materials that allow wet cleaning with the use of disinfectants. The cost of repairs will be 100-200 thousand rubles. depending on area.
The activity of selling pet products should be registered with the tax office in the form of an individual entrepreneur for a small point or an LLC for a large-scale business with the attraction of investor capital. When applying for an IP, they write an application, providing a passport, TIN and a receipt for the paid state duty of 800 rubles. In the case of a legal entity, the amount of the fee will be 4 thousand rubles, you will also need the charter of the company and the authorized capital of at least 10 thousand rubles.
Trust but verify :
Sign contracts with suppliers in advance. With corporations, the contract is concluded 1-2 weeks. Otherwise, when you open, you will be without goods.
The type of taxation in both cases is the simplified tax system at a rate of 15% on the difference between income and expenses or 6% on all profits. The specified OKVED codes: 47.76.2 for retail trade in pets and feed and 47.78 for other retail trade.
For the sale of animals and sale in the drug store, you must obtain permission from the veterinary department, veterinary certificates, the conclusion of the SES and the fire service, signed lease agreements and garbage disposal.
For the functioning of the store and its stable operation, it will be necessary to hire two sales assistants with a shift schedule and a salary consisting of a salary and a bonus part in the form of a percentage of sales.
A plus will be the veterinary education of the staff and work experience, which will improve the quality of service. Must have a medical book with the necessary marks. Bookkeeping can be done online, on an outsourcing basis. Keep a cleaner on a part-time basis.
Purchase of equipment
The pet store should be equipped with appropriate equipment depending on the product range and the area of \u200b\u200bthe premises:
- Showcase worth 6 thousand rubles. per piece
- Racks and shelves for placing pet supplies for 5 thousand rubles. per piece
- Cages for animals and aquariums for fish when they are sold at a price of 1 thousand 500 rubles.
- Cash register and terminal for the possibility of paying with plastic cards for 5 thousand 500 rubles.
The equipment can be new or used, reliable, proven manufacturers.
Store Advertising and Marketing
The amount of customer traffic and store revenue depends on the effectiveness of marketing. This is a colorful sign that attracts buyers, an interestingly designed interior of the room, and effective advertising. Good marketing tools would be:
- Own website, groups in social networks, electronic bulletin boards
- Outdoor advertising: banners, posters, etc.
- Distribution of booklets, business cards in high traffic areas, shopping centers
- Advertising in the media
- Posting ads in elevators, entrances of apartment buildings, transport
- “Word of mouth”
- Placement of information leaflets in veterinary clinics
A small price reduction, discounts, a bonus program, various promotions and quality service will help attract buyers. At the initial stage, saving on advertising is not worth it, since it is important to quickly gain an audience and reach payback.
How much does it cost to open
The size of the initial investment depends on the format of the business and on average is about 600 – 900 thousand rubles, of which:
- Investments in equipment – 150 thousand rubles.
- Investments in goods – 400-500 thousand rubles. based on assortment
- The cost of repairing the premises is 100 thousand rubles.
- Rent – 40 thousand rubles.
- Marketing and advertising – 50 thousand rubles.
- Paperwork – 20 thousand rubles.
Monthly expenses will include: utility bills and taxes, payment of wages to employees, replenishment of the product range, payment of rent and other unforeseen expenses. On average, the amount will be 170 thousand rubles .
How much can you earn
The size of the pet store revenue is determined by the location, the size of the settlement and the markup on goods. Serving at least 15 customers per day with an average check of 1 thousand rubles. earn 450 thousand rubles per month. with a net profit of 280 thousand rubles.
With such indicators of profitability , it is possible to recoup the initial investment in 6 months of work . Of course, you should not expect big incomes at the start, but in the process of work you can reach a decent profit, which will be increased by the provision of additional services: consultations, animals and goods to order, grooming and others.
Possible business problems and risks
While attractive, selling pet products comes with some risks, including:
- Increasing competition, providing for additional marketing activities
- Low level of demand, characteristic of an incorrectly selected assortment
- An increase in current expenses due to an increase in rent and purchase prices, which can be minimized by concluding profitable long-term cooperation agreements
- Poor quality of service due to unqualified staff that can alienate customers
Many problems can be avoided with a competent approach to business, a responsible attitude to all organizational processes. I would like to emphasize the importance of these points once again in conclusion. Only with skillful business management will the pet store bring profit and success.