Spring Festival pet boarding is hot, have merchants made money?

Author| Bai Lu

Disclaimer| The title image comes from the Internet. The original article of the Sting Institute, if you want to reprint, please leave a message to apply for confession.

With the comprehensive relaxation of travel policies, many people chose to return to their hometowns for the Spring Festival and travel for the New Year this year. In order to save worry, the "shovel officers" who raise pets at home have also chosen pet boarding or door-to-door feeding services to solve the problem of eating and drinking for fur children during the holidays.

The Stinging Institute has learned that some pet stores have been "full" due to a strong rebound in demand for pet boarding and home feeding this year. And due to the market situation of short supply, the service price of some pet stores has increased by 50% compared with the usual price, and even there are "luxury pet suites" with thousands of yuan a night. However, behind the boom phenomenon of pet boarding, can merchants really make money?

The market rose sharply, and the "shovel officer" was willing to pay

An indispensable job for young "shovel officers" working in different places before the Spring Festival every year is to settle their pets before stepping on the train back home. Because airplanes, high-speed trains and other public transportation generally do not allow pets, some people will choose to check in, but the long consignment time, high price and possible risks in the consignment process make many people give up this solution. Safer and more reassuring pet boarding and home feeding have become the choice of most people.

Currently, boarding and home feeding services are primarily provided by pet stores or individuals. Among them, pet stores often become the core service provider of pet boarding because they operate pet care and pet supplies retail, and usually accumulate a number of customer resources. In addition, there are individual people who have their own pets but do not plan to go out during the holidays, and will post information on social networks that provide foster care services. However, for safety and professional reasons, most young people will choose to board their pets in a pet store, or choose the door-to-door feeding services provided by pet stores. The complete recovery in demand for returning to hometown and traveling during the Spring Festival this year has also led to a general increase in the price of pet boarding and door-to-door feeding.

"Usually the cost of one day of foster care is only about 120 yuan, but this year's Spring Festival suddenly increased the price to 160 yuan and 180 yuan, at least 50%. According to the 7-day holiday, the boarding fee needs 1100 yuan to 1300 yuan, which is already the food expenses of my cat for two or three months. Xiao Yun, who works in Beijing, told the Stinging Institute that when she went on a business trip in September last year, she boarded her cat in a pet store near the community, and the price at that time was 330 yuan for three days. It's just that I didn't expect the price to rise so much, and the foster care resources are still quite tight. ”

*Registration form to record foster care requirements/photo provided by interviewee

According to Xiaoyun, there are three pet shops near the community she rents, two of which are more than 130 square meters, but in the week before the Spring Festival, the merchants no longer accept orders. Xiao Yun asked the merchant to get the statement that as early as a month before the Spring Festival, customers have come to consult pet boarding services and book cages for pets, and this year's demand is two or three times higher than in previous years, so the orders for the Spring Festival are almost full, and it is too late to find a place to foster when the holiday is approaching. "The pet shop owner said that the cage would not be vacant until the fifth day of junior high at the earliest. I couldn't wait for that time, so I ended up sending the cat to a local friend's house and asking her to take care of it for a while. ”

Demand is hot, can pet boarding make money?

In addition to the general price increase caused by the surge in demand, the pricing principle of pet boarding is also related to the specific service content provided by pet stores. For example, in terms of the foster environment, some customers want their cats to have an independent activity space, and they will choose a "cat villa" with a cat climbing frame and a "toilet". In addition, for customers who have multiple pets at home and want their pets to stay together, the pet store also provides VIP rooms that can accommodate 3 pets at the same time.

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*Photo courtesy of cattery / interviewee in the pet store

Andy, who runs a pet store in Shanghai, told the Stinging Institute that pet boarding not only ensures that the furry children eat and drink every day, but also includes a series of services such as cleaning feces, cleaning and disinfection. According to Andy, during the Spring Festival, he and the staff in the store will arrive at the store on time every day to clean up the feces for pets, clean and disinfect catteries and kennels, and then check the temperature, humidity and status of pets in the room, and record the data in the corresponding table.

In addition, pet shops also offer some differentiated services. "For pets that need to play with them, we will interact with pets in the store, walk dogs outdoors, and take recorded videos to send to customers. For some customers who want to increase the amount of pet exercise, we will also take pets to the park for more abundant activities such as basketball and frisbee. In addition, remote monitoring is also installed in the store, so that customers can view their pets in real time through the network at any time. ”

For the general increase in pet boarding prices during the Spring Festival, in fact, from the perspective of cost structure, the increase in labor costs is an important factor leading to price increases. Because the number of catteries and kennels in pet stores is relatively fixed, when encountering a particularly large number of basic needs, the number of foster care can also be expanded by temporarily increasing the partition, so the space for hardware cost increase is not high. However, differentiated services and additional labor costs incurred during the special period of the Spring Festival are the key reasons for the overall increase in service prices.

Andy revealed to the Stinging Institute that the average labor cost per person per day during the Spring Festival is about 400-500 yuan, and the first to third day of junior high school needs to pay 3 times the salary, without calculating the commission, the labor cost of the 7-day Spring Festival holiday reaches 4000-6500 yuan. On this basis, the time of human and employee is also fixed, and providing pets to play with will directly increase labor hours. As a result, the price of pet boarding services has risen.

Also because of labor costs, the price of home feeding is often higher than the price of store fostering. "In terms of the industry average, the price of home feeding is generally 1.5 times that of store foster care, mainly because home feeding requires dedicated service, and commuting factors lead to some time spent on the way to and from the service, so home feeding takes a lot more time and labor costs."

Pet stores don't make money on boarding

The market is in short supply and the price of merchants is collectively rising, it seems that the development potential of pet boarding services can be seen only from the market during the Spring Festival. Andy also told the Stinging Institute that a 180-square-meter store he runs can accept 40 cats and about 20 puppies when it is full, and the average daily foster care income can reach 5,000-6,000 yuan. However, not all customers are "7 days full-time".

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*Photo courtesy of kennel in the pet store/interviewee

From the actual situation, there are many people who choose to board for 4-5 days, so although the peak demand is full, as the holiday draws to a close, some returning customers will pick up pets, and the income will decrease accordingly, but the basic labor cost has not been reduced. So it's not so easy for pet stores to make money from pet boarding.

Some insiders analyzed that the reason why this year's Spring Festival pet boarding service is so popular is because many people have been forced to celebrate the New Year on the spot in the past three years, and this year, the number of people returning to their hometowns and traveling for the New Year has increased significantly, and they have returned home relatively early, so the demand for pet boarding has been released since about a month before the Spring Festival. However, this "compensatory" consumption phenomenon is difficult to continue later.

At the same time, pet boarding itself has strong cyclical characteristics. Every year, holidays such as "May Day" and National Day will generate a large number of pet boarding needs, and whether consumers choose pet boarding depends on the length of the holiday. The vast majority of consumers tend to choose pet boarding services during the 5-day and 7-day long holidays, and there is basically no need for boarding during holidays of about three days. Based on this calculation, the real time to generate foster care demand every year is only three important nodes: Spring Festival, "May Day" and National Day. Therefore, the income generated by pet boarding can only be regarded as a supplement to the revenue of pet stores.

In fact, as a special offline format, pet cleaning, pet supplies retail and live sales are the more core revenue channels for pet stores. Common pet stores include community stores and shopping mall stores, of which the ratio of pet cleaning and pet supplies retail revenue in community stores is about 1:1, while shopping mall stores focus more on pet supplies retail and live sales. The reason why there is a clear difference in the proportion of income between the two is mainly related to the business environment.

Pet care itself has the particularity of offline services, and pets are also inconvenient to take public transportation due to restrictions in public places. Therefore, many consumers who have just had pets will choose stores within 3 kilometers of the community to provide cleaning services for pets based on the reasons that they can't wash, don't want to wash, and the distance is more convenient—which is also the core business advantage of pet stores. In terms of basic services, by increasing service items and improving service experience, pet care still has room for high-end development. Tony said: "By investing more costs to upgrade services, you can exchange for higher unit prices, so premiumization has become an important means for pet stores to increase profit margins." ”

In addition, some pet stores also display products including pet staple foods, snacks, and pet toys in the store when providing services to consumers. "Sometimes when the staple food is eaten and the express delivery purchased online has not yet been received, in this case, customers will also come to the store to buy a small bag of pet food as a transition." Andy added. In offline service scenarios, whether it is the active promotion of pet store operators or the active inquiry of consumers driven by curiosity, it is more likely to produce purchasing behavior.

As for live sales, although the profits are considerable on the surface, behind the profit margin of up to 50%, there are also high operational risks. Especially for small community stores, after handing kittens and puppies to customers, they may die alive due to environmental changes and other unknown factors. "In this case, you also need to compensate a new living body to the customer, which will not only not make money, but also probably lose money." So the average pet store rarely takes this business as a focus. ”

As a signal of offline economic recovery, the popularity of the pet boarding market during this year's Spring Festival is also the same as the surging crowd of people returning to their hometowns for the festival and traveling for the New Year, making people look forward to 2023 more. However, while being confident, we should also see the limitations of foster care services that have not yet formed a stable income in the actual offline format.

Survived the harsh winter and faced the coming spring. We still need to remain calm and look at the new changes presented in each industry from the perspective that is closest to the truth.

*To protect the privacy of interviewees, the above is a pseudonym only