The Consolidation Of Pet Grooming & Boarding Is Imminent: Industry Growth, Trends, And Current Market Opportunities – Industry Updates & Analysis – Strategy

Overview
The pet grooming and boarding industry in the U.S. is
experiencing significant growth due to the increasing number of pet
owners seeking professional services for their beloved companions.
As pets are considered members of the family, owners are investing
more time and money into ensuring their pets are well-groomed and
properly cared for when they are away. With a highly fragmented
market structure and evolving consumer demands, this industry
presents a compelling opportunity for consolidation.
Market Size and Growth
The pet care industry has seen remarkable growth, with Americans
spending $147 billion on their pets in 2023, of which nearly $15
billion was allocated to grooming and boarding services. Pet owners
are increasingly willing to spend money on premium services that
offer convenience, personalized care, and a comfortable environment
for their pets. This substantial market size, combined with a lack
of dominant high market share competitors, coupled with consistent
growth rates, creates an attractive environment for consolidation
strategies.
Source: IBISWorld | Pet Grooming & Boarding in the US,
August 2024
Source: IBISWorld | Pet Grooming & Boarding in the US,
August 2024
The industry has seen consistent annual growth rates, reflecting
the increasing number of pet owners and their willingness to spend
on premium services. Key factors contributing to this growth
include the following.
- Pet Ownership: As of 2023, 66% of U.S.
households own a pet, recently dropping from a pandemic high of
70%. - Humanization of Pets: Pets are increasingly
seen as family members, leading to higher expectations for their
care and comfort during boarding. - Urbanization and Travel Trends: With more
people living in urban areas and traveling for work or leisure, the
need for reliable pet boarding services has grown.
Source: Statista
A Fragmented Landscape
The pet grooming and boarding sector is characterized by its
highly fragmented nature, presenting a prime opportunity for
consolidation. This fragmentation is largely due to low barriers to
entry, the localized nature of services, and diverse consumer
preferences. With over 160,000 establishments operating in the
industry, no single player holds more than 5% market share as of
2023.1
The industry can be segmented into various types of
facilities:
- Traditional Kennels. Basic boarding services
with individual kennels or runs, typically offering feeding,
exercise, and basic care. - Luxury Pet Resorts. High-end facilities
offering spacious accommodations, play areas, grooming, and even
spa services for pets. - In-Home Boarding. A more personalized service
where pets stay in a caretaker’s home, providing a home-like
environment. - Veterinary Clinics. Many veterinary clinics
offer boarding services, providing peace of mind for pet owners
concerned about their pet’s health.
Additionally, the industry is marked by high turnover rates,
limited economies of scale for smaller operators, and varied
adoption of modern technologies. These factors contribute to
operational inefficiencies and inconsistent service quality across
the sector.
This fragmented landscape creates significant opportunities for
strategic consolidation, offering the potential for operational
efficiencies, brand building, and technology integration on a
larger scale. There is also significant potential to leverage
economies of scale, standardize operations, and create strong
regional or national brands in a largely unbranded market.
Factors Driving Consolidation
Opportunities
1. Economies of Scale
Consolidated operations can achieve significant cost savings
through:
- Bulk Purchasing Power to negotiate better
prices for supplies and access higher-quality products at lower
costs. This improves service quality and margins across all
locations. - Streamlined Marketing and Administrative
Functions to centralize marketing efforts and back-office
operations like accounting, HR, and IT support. This reduces
overhead costs and improves operational efficiency. - Optimized Facility Utilization that balances
capacity across multiple locations and shares specialized
equipment, maximizing occupancy rates and resource efficiency. - Enhanced Bargaining Power to negotiate better
terms with service providers, landlords, and insurance companies
due to larger-scale operations.
2. Technology Integration
Many small, independent operators lack the capital to invest in
modern technologies that are crucial. Integrating technology into
the business can streamline operations, improve customer
experience, and increase efficiency.
- Webcams and Live Streaming allow pet owners to
check in on their pets remotely, providing peace of mind. - Mobile Apps that can be used for booking,
communication, and real-time updates on pets’ activities and
well-being. - Automated Feeding and Monitoring Systems that
ensure pets receive consistent care, even in the absence of
staff. - Data-driven decision-making can also help
facilities optimize operations and personalize services. For
example, tracking pet preferences, health data, and behavior
patterns can enable more tailored care and improve customer
satisfaction. - Customer engagement strategies are also
essential to fostering loyalty and enhancing service visibility.
Engaging pet owners through various channels, such as social media
platforms, email newsletters, and loyalty programs can help drive
differentiation.
3. Service Diversification
Pet boarding facilities can also diversify their offerings to
include additional services.
- Daycare provides daily care and socialization
for pets whose owners work long hours. - Training focused on behavior and obedience as
part of the boarding package. - Pet Transportation such as pick-up and
drop-off services to increase convenience for pet owners. - Senior Pet specialization that accommodates
and cares for older pets with specific health needs. - Exotic Pet boarding for less common pets, such
as birds, reptiles, and small mammals. - Luxury Market options that expand high-end
services to attract affluent pet owners willing to pay a premium
for exclusive care.
4. Geographic Expansion
Consolidation facilitates rapid geographic expansion, allowing
businesses to:
- Enter New Markets Quickly and acquire
established businesses in target markets, bypassing the slow
process of building a customer base from scratch. This allows for
rapid expansion into prime locations. - Establish a Recognizable Brand Across Multiple
Regions to create a unified brand identity and implement
consistent service standards across a wide geographic area. This
builds brand recognition and customer trust on a larger scale. - Cater to Customers Who Travel Frequently by
offering consistent services and loyalty programs across multiple
locations, appealing to pet owners who travel. This encourages
repeat business and customer loyalty. - Optimize Market Coverage by strategically
acquiring or establishing locations to create a comprehensive
network in each region. This allows for balanced coverage across
urban, suburban, and rural areas. - Leverage Regional Synergies and share
resources across nearby locations while developing partnerships
with regional complementary businesses. This improves operational
efficiency and can expand service offerings.
5. Quality Control and Standardization
As pet owners become more health-conscious, they seek boarding
facilities that prioritize their pets’ well-being. Larger,
consolidated operations can implement these trends and standardize
the care across their boarding facilities.
- Nutritional Options with customized meal plans
and premium pet food offerings. - Exercise and Play Programs that provide
structured activities and socialization opportunities to keep pets
active and mentally stimulated. - Veterinary Care that is on-site or on-call to
address any health concerns during the boarding period.
Challenges
Despite the growing demand for pet grooming and boarding
services, the industry faces several key challenges. One of the
main challenges is the high level of competition in the
market, with a large number of grooming salons and
boarding facilities vying for customers. This can make it difficult
for new businesses to establish themselves and attract a loyal
customer base.
Source: IBISWorld | Pet Grooming & Boarding in the US,
August 2024
Another challenge is the shortage of skilled groomers and pet
care professionals in the industry. Grooming and boarding
facilities require trained staff who are knowledgeable about pet
care, grooming techniques, and animal behavior. As the demand for
these services continues to grow, the industry is facing a shortage
of qualified professionals, making it challenging for businesses to
maintain quality standards and meet customer expectations.
The pet boarding industry is also subject to
regulations which can vary significantly by
region. Compliance with local health and safety standards, zoning
laws, and animal welfare regulations can be complex and costly for
facility operators.
Despite the challenges, the pet grooming and boarding industry
in the U.S. offers numerous opportunities for growth and innovation
as well as opportunities for well-executed consolidation strategies
to create significant value by addressing industry-wide issues.
Conclusion
The pet grooming and boarding industry in the United States
presents a compelling opportunity for consolidation. The fragmented
nature of the market, coupled with increasing demand and evolving
consumer expectations, creates an ideal environment for strategic
acquisitions and mergers. By leveraging economies of scale,
integrating technology, and standardizing operations, consolidated
entities can capture a significant share of this growing market
while improving service quality and operational efficiency.
The pet boarding industry is poised for continued growth, driven
by increasing pet ownership and the evolving expectations of pet
owners. Facilities that adapt to emerging trends, invest in
technology and staff training, and focus on delivering exceptional
care will be well-positioned to thrive in this competitive market.
By addressing challenges and seizing opportunities, the industry
can continue to meet the needs of pet owners and their beloved
companions, while continuing to prosper.
Footnote
1.IBISWorld Pet Grooming & Boarding in the US, August
2024.
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