Petfood Forum 2014 session highlights pet industry distribution trends
Online business, private labeling, small niche distributors detailed
At a Petfood Forum 2014 discussion session titled, "How distributor consolidation is affecting petfood retailing," held on April 2, Mark Kalaygian, editor in chief of Pet Business magazine, and Steve King, president of the Pet Industry Distributors Association, highlighted the top petfood industry distribution trends.
Online business is increasing market share in the US, with an estimated US$3.2 billion to US$3.7 billion in 2014 for pet products-5.5% of total pet sales. For petfood, shipping is still an issue even though Amazon.com is currently eating some of the cost. This is good news for brick and mortar pet stores, as more people are inclined to purchase petfood in stores than online.
In the private labeling sector, more distributors are getting into private labeling petfood. It's a way to offer more lines and price levels of products to retail customers. Small lines are responsible for their own marketing, according to Kalaygian, and ride alongs with distribution are critical for small brands to gain a presence in the industry and stand out to distributors and distribution sale representatives. As a company, you need to make it worthwhile for them to focus on your brand.
Small niche distributors can focus on brands, for example raw diets, and grab a piece of the market, said Kalaygian These distributors are hungry and looking to expand their market or be acquired by a larger distributor.