You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple step guide to starting your pet supply store. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
STEP 1: Plan your Business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
- What are the startup and ongoing costs?
- Who is your target market?
- How long it will take you to break even?
- What will you name your business?
Luckily we have done a lot of this research for you.
What are the costs involved in opening a pet supply store?
Unfortunately, starting a pet supply store can be expensive. Because you’ll be competing with your area’s biggest pet supply chain, you’ll need to make sure you’re fully stocked. This means you’ll need to be well-equipped with food, toys, and care products for all pets. Fortunately, you can buy wholesale goods—rather than raw materials. For example, 50 lbs of dog food will cost between $29 and $49. Wholesale cat food, meanwhile, costs between $9 and $13 for a five-ounce case of 32 servings. As for toys and other supplies, average pet supply store products—purchased wholesale—cost between $5 for small-animal items and about $50 for larger items, like fish tanks. If you want to provide supplies for specialty animal care, you can. These items—like large aquariums, for example—can cost upwards of $500 per unit.
For your rent and utility costs, you can expect to pay about $1.20 per square foot of retail space in a wealthy area. So, a 2,000 square-foot shop will cost about $2,400 in monthly rent. You’ll need to pay an average of $300 for startup utility costs. Per month, your utilities can cost between $300 and $500. Expect to pay around $3,500 for shelves, a cash counter, and display cases.
What are the ongoing expenses for a pet supply store?
Most ongoing expenses will be inventory- food, toys, beds, etc. Rent and employee salaries present additional ongoing expenses.
Who is the target market?
Customers who are calm, understanding, and excited about pets are incredibly valuable. An ideal customer will handle their pet with care, have a well-trained pet, understand what they’re looking for, and be open to any care tips. If a pet supply store doesn’t offer adoptions or care opportunities, preferred customers are often repeat customers looking to restock on food and treats for their pet. As a local business, a pet supply store thrives on regulars.
How does a pet supply store make money?
Much of a pet supply store’s revenue is generated from the sale of goods—primarily food. As one of a pet owner’s only locations for food, a pet store receives continuous purchases. Pet supply store owners can expect return visits every couple of weeks. Many supplies pet owners purchase will need to be replenished over time. Such items include toys, beds, and other supplies that wear out over time. Pet supply store owners can expect consistent purchasing trends. Adoption centers, meanwhile, make money from adoption fees. Care centers receive money based upon provided services.
How much can you charge customers?
For dog food, you can normally charge between $20 and $60 for a large bag of dog food. Cat food, on average, is priced between $15 and $40. You can charge customers between $10 and $70 for pet care and entertainment products, depending on their size.
How much profit can a pet supply store make?
According to the American Pet Products Association, Americans spent about $55.72 billion on pets in 2013. On average, a pet store operated by four people makes about $400,000 in sales per year. The average net income of an average-sized pet supply shop is $30,000.
How can you make your business more profitable?
To be profitable as a pet supply store, you’ll need to focus on much-needed supplies. Find out the industry’s leading pet food brands, and stock them. Change your pricing strategy to price these goods competitively. Don’t focus on toys and self-care items right away. Once you’ve achieved a market advantage on food, move into other essential items, like grooming products and vitamins. You can also eventually add services like adoption, grooming, and a veterinary clinic.
What will you name your business?
Choosing the right name is very important. We recommend checking if the business name you choose is available as a web domain and securing it early so no one else can take it.
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC prevents you from being personally liable if your pet supply store is sued. There are many business structures to choose from including: Corporations, LLC's, and DBA's.
You should also consider using a registered agent service to help protect your privacy and stay compliant.
For most small businesses forming an LLC is a great option, but if you still want to weigh all your options check our our article, What Structure Should I Choose for My Business?
STEP 3: Register for taxes
You will need to register for a variety of state and federal taxes before you can open for business.
In order to register for taxes you will need to apply for an EIN. It's really easy and free!
You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.
STEP 4: Open a business bank account & credit card
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.
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.
STEP 5: 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.
STEP 6: 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.
State & Local Business Licensing Requirements
Certain state permits and licenses may be needed to operate a pet supply store. 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.
For more information about local licenses and permits:
- Check with your town, city or county clerk’s office
- Get assistance from one of the local associations listed in US Small Business Associations directory of local business resources.
Certificate of Occupancy
A pet store 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 a pet store.
- 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 pet store will be in compliance and able to obtain a CO.
STEP 7: 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.
STEP 8: 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.
How to promote & market a pet supply store
You should gear your marketing towards local printed ads. Larger chains dominate the online world. If you can partner with local businesses, you’ll have a leg up. Offering deals on social media is a great way to reach pet owners and entice them to come to your store. Promote deals on pet food, if possible, as it’ll be your highest-selling item. Small pet supply shops with well-priced pet food tend to succeed.
Recommended: Get started with local advertising for your business with a $300 credit from Yelp.
How to keep customers coming back
Attract customers with well-priced, high-quality pet food and emergency care supplies. Like a grocery store, a pet supply shop thrives on inelastic demand. Your customers need food for their pets, and they’ll flock to whichever store offers the best prices—assuming the food is of high quality.
STEP 9: Establish your 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.
Start A Pet Supply Store In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
A pet supply store isn’t necessarily hard to upkeep, but it’s best operated by those who love animals. Because all products and services are catered to animal owners, pet enthusiasts, and animal-lovers, having similar interests helps. A pet shop owner needs to not only be happy around animals, but also understanding of them. Frequently, pet shops allow animals on the premises. For this reason, a store owner must be willing to pick up after, calm down, and handle dogs, cats, and other animals. Day-to-day care for pet shop adoption centers is also needed.
What happens during a typical day at a pet supply store?
A pet supply store owner must purchase and distribute pet products. These products are purchased wholesale, but they require aggressive purchasing plans to profit. As with any small retail shop, operators must handle customers, promote products, conduct transactions, handle maintenance, and ensure a clean environment. Pet supply stores which offer adoptions and care centers have an additional set of responsibilities. They must uphold industry health guidelines, ensuring the health, safety, and wellbeing of any on-premises animals, feed the animals, and perform daily care routines.
What are some skills and experiences that will help you build a successful pet supply store?
If you’re a creative, entrepreneurial, pet-loving person, a pet supply shop is right for you. The pet store industry is booming, and it’s an incredibly viable profession. Before getting started, however, future owners are urged to volunteer or work at a pet store themselves. Pet enthusiasts, animal-lovers, and animal activists are solid candidates. From a technical skills standpoint, having retail experience, management experience, and financial experience helps in completing administrative activities. Pet nutrition, veterinary, and pet daycare experience are also incredibly important.
What is the growth potential for a pet supply store?
Pet supply stores have a high growth potential. Because their product demands are inelastic—customers need pet food—they can expect the consistent revenue stream needed for growth. As a local provider, a pet store can even become a preferred location. That said, small pet supply stores may have difficulty competing against large chains, such as Petco and Petsmart.
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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 supply store?
If you’re starting out, it’s a good idea to hold off on pet adoption and care centers. While you can still sell kittens, puppies, rodents, fish, and birds, adoption and care centers present additional legal and financial barriers. Start off by offering basic supplies. If you want to offer animals, start with low-maintenance animals, such as fish. As for customer service, make sure you’re capable of maintaining a cheery disposition. Customer service in pet supply shops is incredibly important in creating an environment to which customers will return.
How and when to build a team
It’s advisable to begin a pet supply shop with at least three people. As the business owner, you’ll be in charge of finances, management, marketing, and promotion. You’ll need a cashier, and you’ll need a worker to clean, take care of animals, and load new stock. Pet supply shops require constant upkeep, so having more workers is advisable.