Three Dog Bakery Inc. was established in 1989, born out of love for a sick rescue dog named Gracie. Celebrating its 25th anniversary in 2014, in addition to being recently acquired by a private equity group (and subsequently renamed Three Dog Bakery LLC), the company now aims to broaden its horizons and strengthen its presence in the premium dog treat segment of the petfood industry.
The company’s basic tenets have always driven, and will continue to drive, the company’s strategy, says Aziz Giga, head of the group that acquired Three Dog and the company’s CEO. “The recent acquisition does not change the guiding principle on which Three Dog Bakery was established some 25 years ago,” he says.” That guiding principle? A love for dogs. “We continue to fresh bake, from scratch, the world’s best dog treats that pet parents everywhere can enjoy sharing with their furry families. All our treats are sourced and made in the USA with premium ingredients. We make the treats for our dogs the same way you would make a treat for your children at home, with care and love in every bite. In addition, we continually introduce new products and fully test them out in our own corporate bakery before releasing them to the market.”
Treats are Three Dog’s business, and the company works hard to get its foot in all the right market channels. “We currently market our premium dog treats and food through four channels: bakery, direct to consumer (DTC), food/drug/mass and pet specialty,” says Giga. “We have expanded our footprint in all channels in the US and Canada. The pet industry is experiencing robust growth globally and we are positioning to benefit from this growth. We have started expanding our geographic boundaries through exports to Canada, Mexico and Japan, and are in the process of shipping products to South Korea, New Zealand, Australia and the UK.”
To stay on top of things, Three Dog introduces new treats and innovative packaging styles annually, primarily through the company’s 35 bakeries. In the last 12 months, Three Dog has introduced such products as Banana Split Duo, Pupkin Spiced Latte, Puppermint Mocha, Blueberry Muffins, Harvest Apple Duo, Pupkin Seeds, Paw-ty Pack Duo, The Girls Snickerdoodles, Puppy Kisses To Go and Grain-Free treats. Products that see retail success in the company’s bakeries are then introduced to Three Dog’s pet specialty and food/drug/mass channels. “For example, you can see our Café Cups, Beggin’ for S’mores and Banana Split in all PetSmart stores,” says Giga. “For pet specialty and our food/drug/mass channel, we typically introduce new items at the SuperZoo and Global Pet shows.”
This momentum will only grow, according to Giga. “The current state of the petfood industry is favorable in terms of growth,” he says. “It follows many of the trends in the human food industry, so the need for new products continues to grow. At the same time this is a highly competitive industry with few barriers to entry. As the proliferation of product offerings continues, our focus on total quality and product innovation is becoming increasingly important.”
Three Dog’s business strategy is built to take advantage of this, says Giga. “The key elements of our strategy going forward are as follows: further strengthen our manufacturing processes and procedures; expand our bakery channels through company-owned bakeries as well as through existing and new franchisees; broaden our footprint in the food/drug/mass and IP channels; expand geographically; and strengthen a culture of quality to ensure we meet the needs of our customers, community and employees.”
The company’s biggest opportunity right now? Expansion—specifically, the expansion of Three Dog’s bakery channel network through company-owned stores and franchisees. “Our bakeries offer a unique experience to customers both human and canine,” says Giga. “It’s a great place to pick up not only the necessities like dog food, training treats or a new leash, but also the exciting new items that make it a special treat. After a visit to the vet or a trip to the groomer, stopping in Three Dog Bakery is the perfect way for customers to reward their dogs and treat them to a special outing. Our bakeries also cater to pet parents excited about celebrating milestones in their dogs’ lives like birthdays, adoption days and graduations from training.”
Given the high-paced nature of the pet industry, Three Dog says it’s paying close attention to all segments, and expects the industry overall to continue to parallel the human food industry in terms of quality, packaging, innovative offerings and nutrition facts. A primary challenge for the company, says Giga, is keeping up with both the pace and its continuing flow of new trends. “Everything in our industry has a long lead time,” he says. “We have a tall order so balancing our resources becomes critical. Finally, the dog treat and food market is highly competitive, so maintaining our differentiation through new products and services becomes increasingly important.”
Whatever speed the industry moves at, Three Dog is prepared. “We have a very favorable outlook for Three Dog Bakery,” says Giga. “We have an excellent and innovative work force; we have dedicated franchisees willing to participate in our growth; we have a well-established brand in the premium treat and food segment of the pet industry; we have a strong customer base; and we have great products.”
