There are 2 types of chain pet shops you can choose, one is the regular chain pet store, one is a franchise store. Franchise chain pet store is suitable for the new people, who are new to this business. Because they will provide all the things, like supply chain, marketing guide, management training. You will get into this business very quickly, while the regular chain pet store is usually managed by the brand themselves.
We compared two shops of the regular chain pet store and franchise pet store, let’s see the profits. This time, we analyzed 1 regular chain pet store that has 82 stores, 1 franchise chain pet store that has 5000 stores. First, let’s see the franchise pet store operations.
Regular chain pet store location:
The location of this store is not very good, it’s next to the office building and the universities in the east. There are only residential areas in the south. But the nearest pet store is out of 1km. Most of the people there are stuff, so they don’t live in this area.
Environment:
It has 40 square meters, the pet caring and grooming has 12 square meters,fostering area has more than 10 cages. Since it is just finished the decorations, so the environment is good.
Retailing:
Most of the items are their own brand, there is only a shelf for the snacks. While pet foods have 2 shelves, pet supplies have 2 shelves. The gross profits are around 30%-40%.
Pet caring and grooming:
Bathing 1 small dog price is 50-60rmb, the shearing price is 120-140rmb. They can wash 4-5 dogs per day. Since there are no pet groomers, so they can’t provide the pet grooming service.
Pet Fostering:
At least 60rmb, the fostering quantity is at most between 10-20.
So overall, the rent is about 13 thousand RMB per month, which is about 11rmb/square/month since the location is not very good, the rent is cheap. It opened 10 days ago, the turnover is about 300-400rmb per day. It’s losing money now, and the boss wants to keep this situation for half a year.
Since there is only the boss in the store, so there is no labor cost at the moment. Including the previous investment and equipment cost 100 thousand RMB, the joining cost is about 63 thousand RMB, rent is 13 thousand rpm, labor cost is about 7 thousand RMB, so it needs 2 years to make money.
Franchise Chain Pet Store
We get more information about the joining policy, the joining cost is about 63 thousand RMB, the guarantee cost is 3 thousand RMB. The head office will provide the opening store guide, products supply(include the pets), pet grooming training, decorations solutions and other kinds of services. We are the pet products manufacturers for this brand, so they usually place the OEM orders to us. The head office guarantee that the gross profits are above 50%.
According to the franchise pet store owners, they can choose to source the products from them or outsource from others. They can also choose what to source. The average profits are about 30%-40%, it is similar to the community store, store owners can manage the shop by themselves.
But as the franchise shop principle, the basic requirement of the pet store is unified VI and decorations, products, supply chain system, service & SOP and complete training and supervision system. But it seems there is no franchise brand that can do all these things. Here are the reasons:
1. Pet food has fixed competition situation
The number 2 and number 3 are fixed for years, even though the best selling brand can not take lower discounts. And the best selling products don’t have their own management system. If one franchise brand wants to produce the pet food, they can only do OEM, and there is no strength on cost.
2.Pet caring and grooming.
The store’s profits are in the labor cost, the pet groomers also take a bonus from this part. But as the head office, they can not make profits from this service.
3.Pet fostering
It’s making money from renting the space, the head office can also not take part in the profits.
4.Pet selling.
Since the pets supply chain is long, so the damage rate is very high, the head office can not take this as their business part.
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