The Brazilian pet sector has coordinated actions with public authorities and the private sector to mitigate the effects of the coronavirus on the economy and on the lives of families with pets.
However, according to Nelo Marraccini, executive president of Instituto Pet Brasil (IPB), “it still isn't possible to know with certainty how the sector fared in the first months of the pandemic. The overview is that entrepreneurs can demonstrate the resilience of the sector, which ranks among the top five in the world in gross sales.” IPB brings together the retail network, animal sales and pet service providers from all over Brazil.
One of the triumphs along with state governments is the recognition of all links in the pet chain as essential services for the population - from industries to pet shops, veterinary clinics and other veterinary services. The decision was made at a time when many services for the population were forced to close their doors.
“Despite the opening of street shops in April, the recommendation is that pet grooming services be closed or reduced - except in the case of therapeutic actions (such as therapeutic baths) for the welfare of sick animals. We understand, of course, that each city, state and region has its own economic context, and that different locations are impacted by the pandemic on different levels. For storeowners, our advice is to focus efforts on selling online or over the phone, and to reinforce contacts with customers in the neighborhood or region, offering services such as product subscriptions - for example, delivering pet food and other products to customers every two weeks. It is a way to preserve working capital and keep teams working,” says the IPB representative.
For the Brazilian business community, IPB has also started offering distance education business qualification classes this year, based on the PDI Pet platform. The training qualifies companies to participate in the Pet Brasil sectoral project in partnership with Apex-Brasil - the Brazilian Trade and Investment Promotion Agency. Aimed at international investments, the project portal has Spanish and English versions.
At the same time, working with the Ministry of Agriculture, Livestock and Supply, sector representatives guaranteed exemption from the registration of ingredients, supplements, technological additives, nutritional additives and sensory additives for the animal food products sector. The decree regulates federal law, which defines public services and essential activities during the pandemic. This change reduces bureaucracy in the production process.
The numbers so far | Despite its resilience, the sector is starting to show a deceleration in profits in 2019, even while registering growth. “Our understanding is that the sector has remained stable. Adding industry and retail together, we would have reached BRL 35.4 billion in sales at this time last year, based on the data analyzed up to the third quarter of 2019,” says Marraccini. "This projection represents a 3% growth over 2018, which saw revenues of BRL 34.4 billion. However, growth in 2018 was 4.6% higher than 2017.”
In addition to high taxes (for example, more than 50 cents of every 1 Real spent on pet food by consumers are taxes) it was found that consumers are, in general, opting for cheaper products, trading premium items for standard ones, and taking their pets to be groomed less often, for example. “People who have a pet at home may hold back on spending in these turbulent times, but they don't stop taking care of their pets, which is very positive,” concludes the president of IPB.
The numbers for the first quarter of 2020 should be released soon, and may indicate how the Brazilian pet sector has responded to the challenges of social isolation and the pandemic.