The Pet Market Bounces Back !/? 2009 > 2014 – Part 2: Pet Food and Pets & Supplies

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In our last post we discussed the performance of the the Services segments during 2009-2014. We’ll now turn the spotlight onto Products – Food and Supplies.

We’ll start with the largest segment – Pet Food

9-14-FoodData

 Here’s a “Visual” comparing Retail $ to Sales adjusted to remove price increases:

9-14-FoodChart

Pet Food Market 2009-2014 Recap

Growth

  • Retail for Pet Food grew 28.8% (average annual growth rate 5.19%)
  • CPI (Prices) went up 9.6% (average annual increase 1.85%
    • Only 35% of this segment’s growth was from price increases
  • Adjusted growth (factoring out prices) – 20.64% (average annual growth rate 3.3%)

Key Waypoints

  • 2010 – Spurred by price drop – sales “took off” – 7.2% adjusted sales growth…actually exceeded full retail growth.
  • 2012 – Price “bump” slowed growth
  • 2011-2014 Generally steady growth

The Future

  • This is the largest segment and has a great impact on the market. Although it is a necessity there is price sensitivity. It appears that the best growth appears when the annual increase in CPI is kept to 2.3% or less

Now let’s look at Pets & Supplies

9-14-SuppliesData

 Here’s a “Visual” comparing Retail $ to Sales adjusted to remove price increases:

9-14-SuppliesChart

Pets & Supplies Market 2009-2014 Recap

Growth

  • Retail for Pets & Supplies  grew 26.6% (average annual growth rate 4.83%)
  • CPI (Prices) went DOWN 4.7% (average annual DECREASE 0.96%)
    • Adjusted Sales growth (the amount) ACTUALLY EXCEEDED Full Retail Sales $
  • Adjusted growth:  32.8% (average annual growth rate 5.84%)

Key Waypoints

  • 2010 – Spurred by price drop – sales “took off” – Adjusted Sales Exceeding full retail $ Sales
  • 2011-2012 – Continued strong sales – Peak adjusted growth 7.1% in 2012
  • 2013-2014 Sales Growth – Both Full and Adjusted slowing but still strong

The Future

  • The consumer is buying more and paying less. This demonstrates the price sensitivity in the market. However, a prolonged period of deflation will increase pressure on all manufacturers. In the estimate above, it was assumed that the CPI would only fall 0.8% in 2014. So far through May, the indications are that prices could drop a full point or more again!

In the final Post in this series we will take a look at how these segments blend to produce the overall Total Pet Market!.