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The United States has one of the highest pet ownership rates in the world, with close to 100 million households owning pets as of 2022. This opens a subsequent need for pet food, supplies, treats, and more. In fact, research shows that pet owners are projected to spend close to $100 billion on these very items in 2023 alone. With this lucrative opportunity afoot, pet stores have never been more relevant.
To make the most of this business endeavor, however, there are a few key considerations you need to tackle first. From ensuring your business is compliant with local regulations to accepting payments, here’s what you need to know in order to open a pet store.
Stage 1: Planning your pet paradise
Catnip specialty store? Private lizard lounge? All good businesses start with a solid business plan, and there are some crucial steps business owners need to consider regardless of the products or services they sell. There are also specific needs for dealing with animals that will need to be factored in.
When you decide on the type of pet store you want to open, performing market research should be a walk in the dog park. Examine the existing competition and familiarize yourself with the current pet industry to learn what others are doing well and what you could be doing better. By researching online, visiting pet stores, and talking to pet owners, you will get a good sense of what is needed in the market and the role you might play in it.
Your business plan should include who you anticipate your prospective customers to be, your business objectives, sales projections, market analysis, and details on how you will fund it all before you make your first sale. You will also need to plan how you will market your business to new customers through social media, email or SMS marketing, and your website, and how you will turn your customers into loyal shoppers.
Stage 2: Licenses, codes, and insurance
When establishing a new business, at minimum you will need to:
- Choose a business name. Choosing a business name is a significant undertaking. It’s often the first element of your business that customers will notice, and it’s important to make it count and make it memorable. Once you decide on a name, you may need to register it with your state and local governments, and you may want to trademark it to protect it from being used by competitors. We suggest you speak with a legal professional to learn more.
- Decide on a business model and structure. A business model is how you will sell your items. For example, wholesale and franchise are popular business model types. A business structure, on the other hand, mainly refers to the legal structure of a company. Types of business structures include sole proprietorships, partnerships, limited liability companies (LLCs), and corporations. Because each business model and structure has its own legal and tax implications, consider consulting an expert to determine what type will best serve your vision.
- Apply for the correct business licenses and permits. Business licenses and permits essentially give your business permission to operate. Different businesses require different types of licenses and permits, and some may require more than others. Consulting with an attorney or business expert can help ensure your business is up to the correct standards.
- Secure business insurance. Business insurance protects your business and your employees in the event of an accident. There are several types of business insurance, including workers’ compensation insurance, general liability insurance, property insurance, and more. Because of the nature of a pet store, it may require extra insurance, such as animal damage insurance, which protects against damage caused by animals to buildings.
If the vision for your pet store includes the sale of live animals, you may also need to abide by other legal requirements in your state, territory, or local council area. The sale of live animals, such as dogs, cats, and birds, usually requires a permit and means following certain codes that protect you, your customers, and the animals themselves. In some instances, certain aspects even make the sale of live animals illegal. In California and six other states, for example, it’s illegal to sell animals sourced from puppy mills. Make sure you are familiar with the requirements where you plan to operate.
To learn more about what is needed in your state or territory, speak with your local council or relevant state or territory government department.
Stage 3: Online versus brick and mortar
When planning your physical location, there are several factors to consider, including the availability of physical space, the cost of rent, overhead, staffing requirements, payments software, local and state government regulations, and more. It’s also important to keep in mind the amount of foot traffic you’re expecting and the amount of time the average customer will spend in your store. These factors will impact not only the location but also the size of your space.
Also, consider your online presence. With the way consumers shop continuously evolving, a healthy mix of in-store and online sales can help broaden your reach with customers and boost your sales. According to Statista, almost 30% of pet owners shopped both online and in physical stores, and 16% shopped mainly online. Furthermore, online pet supply sales may double to close to $60 million by 2030.
No matter what you decide, Square has you covered at the point of sale with Square for Retail, allowing you to manage your inventory and sell with ease in-store and online.
Stage 4: Inventory, suppliers, and fit-out
You’ve got a solid plan, you’ve registered your business, and you’re insured and ready to adhere to the various codes and legal requirements. Now it’s time to source suppliers, purchase stock, and organize your facilities and hardware.
Often, pet stores have many different suppliers—from dog toys to bird seed, fish tanks to kitty litter. And if you are selling services in your pet store, you will need suppliers for those too (dog groomers need to buy shampoo and scissors from somewhere). If you are selling pet food, you will need to carefully consider the quality and reliability of your supplier, and if you plan to sell live animals, your supplier should be licensed and reputable. No matter the product, you have to make sure your suppliers are right for your business—they are your partners and deeply connected to your own brand.
Your store layout is essential for practical reasons, but it will also demonstrate to your customers the kind of business you are running. You will need to consider product storage and display, lighting, flooring, decor, and many other factors. You will also need to consider your POS tools. Square tools can provide a complete POS hardware kit so your sales run smoothly from day one.
Once you have your suppliers locked in, inventory management will be essential to keeping track of what is coming in, what is going out, and what is still waiting on your shelves. It is important to have your inventory management processes in place before you start trading. With Square Inventory Management software, you can track and manage your inventory with ease, automate purchase orders, manage multiple locations, get help with vendor management, and more.
The fine (paw) print
Opening a business can be rewarding, but there are a lot of components to consider. It is always a good idea to get guidance from lawyers, financial planners, and the local authorities where you plan to operate. And if you need more information, explore the government’s starting a business guide.
