Online pet food and supply company Chewy is making a killing with Americans’ treating their dogs like humans, allowing it to earn $3.5 billion in 2018, which is 65 percent higher from 2017.
A girl and her furry friend. Image by Rebecca Schönbrodt-Rühl from Pixabay
The company experienced a spike in sales every year since it started operations in 2011, with nearly two-thirds brought by its automatic-refill service.
The robust earnings prompted Chewy to go public while crediting the acts of pet parents in viewing pets as part of the family for its robust growth.
According to Chewy, the so-called “pet-humanization” trend is boosting expenditures on health care for pets and premium and organic foods.
It also pressured another pet supply company to stop selling dog and cat food with preservatives and artificial colors.
Nearly 85 million US households have at least one pet, up from 73 million in 2010, according to the American Pet Products Association, an industry trade group. With most of them treating their dogs like humans and family members, the impact of dog supply business is enormous.
The company hopes to expand its new pet health care business called “Chewy Pharmacy” boosting its higher-margin pet goods brands Frisco, American Journey, and Tylees.
Chewy calls its frozen dog food brand Tylees as consisting of human-grade beef, pork, chicken, turkey, and salmon.
Is serving your dog human-grade food a good idea? Check out the following YouTube video by WXYZ-TV Detroit Channel to help you decide:
The pet supply industry has grown yearly for over a decade straight. In 2018, sales reached $72 billion.
For companies dealing with pet food and pet grooming businesses, these figures represent a windfall.
About 42 percent of the expenditures on pets go to food, while 47 percent goes to veterinarian care, pet supplies, and pet medication.
According to Chewy, online shopping comprises 14 percent of the pet industry’s food and supplies market in 2017. It is projected to increase to 25 percent by 2022 as more Americans patronize e-commerce and have their pet goods delivered to their homes.
PetSmart, which bought Chewy in 2017 for $3 billion, remains the majority owner of Chewy after its IPO.