Revolution Road to Informatics a Business Proposal for a Pet Store

Revolution Road to Informatics

——a business proposal for a pet store

I

Reportedly, there are more than half of the households in the United States own a pet. In my country China, the pet industry has also been experiencing the explosive growth over the past five years. According to the “2018 China Pet Industry Report”, which was released in April 2019 by Frost & Sullivan, a world's largest growth consulting company that the penetration rate of household pet ownership in China has grown from 16% in 2013 to 22% in 2018. And the number of pet owner households has increased from 69.3 million in 2013 to 99.8 million in 2018, with a 43.9% increment[1]. No doubt that this industry will keep on expanding its business in the near future.

This just reminds me of a pet shop near my neighborhood in Shanghai. It’s about 1000 m² large and is located at the corner of a plaza, which has a subway station exit nearby. Grooming salon, which includes bathing, trimming & styling is its primary business scope. They also provide pet clinic and hotel service. Besides the store manager, there are 3 pet stylists, 1 receptionist, 1 vet and 1 intern in the store. Depends on its location, most of its clients are the neighbors who live around the plaza within 2 miles. Normally it’s slow during daytime business hours on weekdays. Nighttime and especially weekends are the rush hours. Most people are off work and have time to take their pets for a shower or grooming. Due to the increasing rental fee and labor fee, the pet store’s business is beyond satisfying. Only maintaining the old customers is not applicable in the long run to keep balance. How to bring more business to make up the gap during daytime is a great challenge to the store manager. I had some talks with the store manager when I was waiting for my puppy grooming. He’s a middle-aged traditional man, with some vet background. He shared a lot of experiences with me about how to raise a dog, and also some concerns about the store’s current situation. But he’s still confident and ambitious. He admitted that he felt a lot behind in recent years due to the fast-moving high technology in daily life. Some old-fashioned business mode must be out-of-date. Compared with another pet store which is 3 miles away, this store’s communication methods are quite limited and out-of-date. It doesn’t have any official website or any commercials posted. Even the store’s information shown on any search engines is inadequate. These are all the obstacles to get new customers. The competitor store is almost the same scale as this store. But the number of its customers at least doubles. During daytime, you can also see some owner and pets hanging around there. It has its own website and the newsletter which is published every quarter. There are a lot of customers’ reviews on local search app like Yelp and other platforms. It also has a mini van with the store’s ad on its body, which is mainly for the pet’s pickup. The competitor store fully utilizes different communication methods to keep and bloom its business, not only within the neighborhood, but also throughout the city.

In order to keep business running, it’s time for the store to take action. All digitals are the weapons which could give the business a shot to gain more clients and expand its business variety.

It is estimated that the market size of the China's pet industry would reach RMB472.3 billion by the year of 2023. In 2018, the average annual consumption on a pet dog or cat was RMB3,969. With the growing CPI in China, especially among those big cities like Beijing, Shanghai and Guangzhou, the living standard of pets has also been improving over the past years. The purchasing power of pet owners is gradually increasing along with the pet industry. It’s really a hot potato about how to transit this pet store into a modern one that would come up with the information age.

E-commerce is the first transition way that comes out of my mind. I will strongly recommend to build an official website for the store. Besides the in-store service, a website is just like a person’s appearance which would make the first good impression to customers. It’ll also bring a brief image about the store to new customers. With some invitation coupons or deals, it’ll definitely attract more customers to store. We could list all the services the store provides on the website, including directories of staple food and accessories for pets which owners can order online. Unlike pet owners in the U.S. who prefer to buy pet products in store, 89% of the pet owners buy pet products online in China. Most of the them are among the 80’s and 90’s who have higher education and are more used to using laptop or mobile for online shopping. Online business should be considered as part of the store’s financial goal. Online reservation for grooming is also a function which should be built in. There are other features we could add such as Q&A, Feedback and Forum which could improve owner’s communications with each other and maintain the relationship with store as well. The final goal is to build a pet neighborhood surrounded by the store. Speaking of the data management, we should set up the files for both owners and pets. This will bring a lot of convenience for further use. We could track a pet’s disease history, owner’s contact information and the birth date for both. After some data analysis, we could sort the pets according to their breeds, ages, food brand preferences, etc. In 2018, as reported, the global animal health market size was valued at USD 44.74 billion and is expected to witness a compound annual growth rate of 5.7% during the forecast period. Next step, we should focus more on pet healthcare instead of regular grooming service. We should also install some live cameras not only for store’s security, but also for pet’s observation. Research from Mintel shows that over 60% of owners consider their animal companions to be members of the family. Sometimes owners will send their pets to store for several day’s daycare due to a business trip or vacation. Once we have the camera which you could turn on at any time and say hi to your baby, that will offer a great comfort to the owners.  If budget allows, the mobile app is a plus to have, which has the similar functions as website. Nowadays, smart phones could do most of the jobs that a computer used to do. People are more inclined to use their mobile at anytime, anywhere. No one prefer putting on a reminder and doing afterwards when back home. Instant communication is all we want. That’s how the mobile apps are becoming more and more popular now. Based on the GIS technology, we could apply it on the mobile app to help locate the owner or pet for pickup service and online order delivery. We could even build in a chip on the pet which we could locate it at anytime just in case it gets lost. Once the hardware and software are all set, we need to think about how to combine all of these platforms together to push the business forward. The store manager should have a common sense of project management to conduct the staff about each function.