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Every year, about 3.2 million dogs and cats are adopted. Most of these adoptions are done through non-profit pet shelters. It’s possible to run pet shelters as for-profit businesses, though.
For-profit pet shelters take in unwanted pets and pets that people can’t care for. Shelters provide veterinary care for these pets. Then, they find new owners who will adopt the pets.
Who is this business right for?
Anyone who loves pets and has good business sense might enjoy running a pet shelter business. A heart for animals is needed because these businesses focus on helping pets. Business acumen helps owners transform a traditionally non-profit model into a for-profit business.
What happens during a typical day at a pet shelter?
Business owners spend time taking in pets and caring for them. Caring for pets involves feeding them, getting them veterinary care, brushing them, cleaning their cages and playing with them.
Owners also work to get pets adopted. This involves going to events, promoting adoptable pets and interviewing potential adoptees.
During slow times, business owners pay bills, manage volunteers and employees, and promote their business.
What is the target market?
A pet shelter business’ ideal customer is someone who loves animals. Such a person may want to adopt a pet, and they might be willing to pay a sizable fee to do so.
How does a pet shelter make money?
A for-profit pet shelter business can make money when pets are dropped off and when they’re donated.
For instance, Mike Arms requests a payment when a puppy is dropped off. He also charges a fee to adopt a puppy. (If people won’t pay the drop-off fee, Arms will still take a pet.)
What is the growth potential for a pet shelter?
Most pet shelter businesses serve a local area. For example, DogsAspen operates in the Aspen, Colorado area. Staying local helps a business owner network with vets and pet lovers in the region.
What are some skills and experiences that will help you build a successful pet shelter?
Business owners must know how to care for pets and how to run a business.
There are many resources on how to care for animals and run shelters:
- The Association of Shelter Veterinarians has information on shelter standards.
- The ASPCA has details on how to care for different pets.
- Best Friends Sanctuary has a variety of classes.
- Karen Pryor Academy has an online shelter training course.
Business owners who don’t have a background in business may want to take a course in business. Many community colleges offer business courses. There are also online classes. Coursera has many classes on different aspects of business. Open Culture maintains a list of classes that are free.
What are the costs involved in opening a pet shelter?
The startup costs of opening a pet shelter business are fairly low. Business owners need:
- a space to house pets
- access to veterinary care for pets
- food and water for pets
Business owners can keep the cost of space low by remodeling their home to house pets. For instance, cats can be kept in a basement. Dogs can be put in pens and dog houses that are outdoors. Alternatively, business owners can lease space in a low-rent district that has little commercial value.
Non-profit pet shelters often partner with vets who provide free or low-cost medical care. Vets may be less willing to offer free services to a for-profit business. For-profit shelters might still be able to get low-cost vet care, though. Some vets might even be willing to offer all the veterinary care pets need in exchange for a percentage of each adoption fee.
When starting out, business owners might be able to get food at discounted prices from a local pet store. A pet store that believes in a shelter’s work may be willing to offer a discount on bulk food orders to help the shelter succeed.
What are the steps to start a pet shelter?
Once you're ready to start your pet shelter, follow these steps to ensure that your business is legally compliant and avoid wasting time and money as your business grows:
- Plan your business. A clear plan is essential for success as an entrepreneur. A few important topics to consider are your initial costs, your target market, and how long it will take you to break even.
- Form a legal entity. Establishing a legal business entity prevents you from being personally liable if your pet shelter is sued.
- Register for taxes. You will need to register for a variety of state and federal taxes before you can open for business.
- Open a business bank account. A dedicated checking account for your pet shelter keeps your finances organized and makes your business appear more professional to your customers.
- Set up business accounting. Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
- Obtain necessary permits and licenses. Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
- Get business insurance. Insurance is highly recommended for all business owners. If you hire employees, workers compensation insurance may be a legal requirement in your state.
- Define your brand. Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
- Establish a web presence. A business website allows customers to learn more about your company and the products or services you offer. You can also use social media to attract new clients or customers.
Select your state below for an in-depth guide on completing each of these steps in your home state.
Where can I find a business mentor?
One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
What are some insider tips for jump starting a pet shelter?
Business owners who want to open a for-profit pet shelter must believe in their business. Most people expect shelters to work as non-profit organizations. Business owners have to be able to explain that pets have value -- and people should be willing to pay for that value. If they can’t explain this, owners will struggle to justify their higher fees.
How to promote & market a pet shelter
A pet shelter business should be advertised where pet-lovers are likely to be. Vet offices, events and pet stores are good places to post flyers. Targeted ads on social media can also be effective ways to market a pet shelter.
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How to keep customers coming back
A pet shelter business can distinguish itself by specializing in a particular type or breed of animal. Although a non-profit, the North Texas Scottie Rescue does this. The rescue only takes in Scottish terriers.
By specializing in a particular breed, a pet shelter will attract people who want that type of animal. These prospective adopters may be willing to pay a premiums fee so they get the exact breed they want. A pet shelter might be able to charge less than a breeder, creating a win-win scenario.
How and when to build a team
A pet shelter business can be run by one person. The work is easier when divided among several people, though. Many shelters have a team of volunteers when they open. Volunteers might help by:
- feeding pets
- brushing pets
- cleaning bowls and cages
- playing with pets
- fostering pets
- interviewing adopters
As a business’ income grows, employees can be hired to do a lot of the work volunteers do.
State & Local Business Licensing Requirements
Certain state permits and licenses may be needed to operate an animal shelter. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.
Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses.
Maintain Personal Asset Protection
Don’t think that just forming an LLC, or any other type of business, will save your personal assets in case of a lawsuit or other matter by itself.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your LLC is sued. In business law, this is referred to as piercing your corporate veil.
Two of the simplest steps that will protect your business, and yourself, are to:
Open a business bank account
- This separates your personal assets from your company's assets, which is necessary for personal asset protection.
- It also makes accounting and tax filing easier.
Get a business credit card
- This helps you separate personal and business expenses by putting your business' expenses all in one place.
- It also builds your company's credit history, which can be useful to raise money and investment later on.
Certificate of Occupancy
An animal shelter is generally run out of a storefront. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO). A CO confirms that all building codes, zoning laws and government regulations have been met.
- If you plan to lease a location:
- It is generally the landlord’s responsibility to obtain a CO.
- Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to an animal shelter.
- After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening, it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
- If you plan to purchase or build a location:
- You will be responsible for obtaining a valid CO from a local government authority.
- Review all building codes and zoning requirements for your business’ location to ensure your animal shelter will be in compliance and able to obtain a CO.
How much can you charge customers?
A pet shelter may charge ask for a few hundred dollars when a pet is dropped off and when it’s adopted. Arms requests $200 when a dog is dropped off. The amount increases to $2,000 for dogs over seven years old. He also charges $399 to adopt a puppy. His adoption fee is determined by the market.
What are the ongoing expenses for a pet shelter?
The ongoing costs of running a pet shelter business are manageable. They include:
- buying food for pets
- paying for space to keep pets
- paying for veterinary care pets need
How much profit can a pet shelter make?
A pet shelter business’ profitability isn’t widely known, because most shelters are run as non-profits. Non-profit shelters often employ a director, vet tech and other staff. A for-profit business can earn enough to pay for a team’s salaries, which often total six-figure sums, and still provide a profit.
How can you make your business more profitable?
A pet shelter business can increase its revenue by adding a pet store or vet office to its services. People who adopt pets need veterinary care and supplies for their pets. Thus, these are both natural businesses to add to a pet shelter.