Fashion perks up pet goods - discount retailers are seeking their pet departments expand as new products come out

Discount Store News, Nov 18, 1996 by Robert Scally

NATIONWIDE DSN REPORT - Now canines can look good on walks and felines can glow in style.

Fashion - from movie-theme dog leashes to glow-in-the-dark cat collars - has arrived in the pet department, and mass merchant pet departments are growing, industry experts report.

Penn Plax, which manufactures pet products featuring Walt Disney and Warner Bros. cartoon characters and items relating to Disney's new live-action "101 Dalmatians," is talking with Kmart, Wal-Mart and other retailers, said John Michels, vp of administration. Plax, based in Garden City, N.Y., currently has sales program with Ames, Hills, Venture, Petco, PetsMart and major regional grocery chains such as Kroger. Even Blockbuster Video has gotten into the act; it will use "101 Dalmatians" leashes for a promotion involving the release of the live-action film.

Products in Penn Plax's 242-sku catalog include dog and cat apparel (including sweaters and raincoats), dog and cat beds, dog collars and leashes, brushes and feeding accessories such as bowls.

"People might not buy a dog bed, but if they saw something that looked really nice and matched their living rooms or their children's rooms where the dog sleeps, they might go out and buy that," Michels said. "That would turn them on to a whole other set of products."

He added, "Coming in and saying `I'll beat his dog bed price by 10%' isn't cutting it anymore. You have to make new things that are going to grow the industry."

That message is coming through loud and clear at Petco, where Disney's licensed merchandise will be featured in a self-contained endcap, said Larry Asselin, Petco's senior vp of marketing and sales. Self-cleaning kitty litter boxes and fashion collars for both cats and dogs also show promise of being big sellers, he said.

Asselin said he likes the "Buster Cube," a $14.99 play toy for dogs that dispenses food as the dog plays with it. The more the dog plays, the more food the Buster Cube dispenses.

New fashions and licensed product are breathing new life into basic accessories such leashes and collars.

The leash and collar market lit up several years ago when nylon leashes and collars in neon colors brightened the scene. Neon colors were quickly joined by leashes and colors featuring logos and printed patterns. More recently, sales of retractable leashes, popular in Europe, are taking off in the United States, said Denise Sibole of Coastal Pet Products.

Safety sells, she added. Special leashes made for jogging and others that are reflective or glow in the dark are also new trends within the product niche. Adjustable collars that can give a customized fit are growing in popularity because of their utility and perceived value, she said.

Firms that had traditionally served the fragmented retail pet products industry helped drive the innovations. Coastal Pet Products pioneered licensed pet products by selling a line of leashes and collars featuring logos of National Football League teams.

More recently, Penn Plax introduced a wide assortment of entertainment-related licensed merchandise into the category.

Adjustable nylon collars for dogs are dominating the market, said Larry Kissinger, merchandise director for the 40-store Superpetz chain based in Dayton, Ohio. Patterns and woven cloth materials for dog and cat collars are also gaining popularity, he said.

Fashion programs from some manufacturers that offer rotating selections of leashes and collars that change on a quarterly basis are also a new trend, Kissinger said.

Because of the growth in the pet supplies categories in mass merchants and pet superstores, pressure has been put on some pet product manufacturers that previously catered only to independent pet specialists to start selling to the mass market.

One manufacturing executive said that he's seen demand from mass merchants for new products grow by 30% to 50% during the past few years. His company has sold product into the mass market and has taken heat from his independent dealers in the process.

That kind of pressure will only increase as the market consolidates and superstores chains like Petco and Pets-Mart grow. In addition, mass merchants and supermarkets are steadily expanding their pet aisles, said Simon Handelsman, a pet industry consultant based in Newburyport, Mass. The strategy continues to squeeze out smaller players in the fragmented pet food and supplies business.

In terms of overall trends, discounters will probably enjoy greater access in the near future to brands that had previously been exclusive to pet specialists.

Pet foods are continuing to rend to upscale, with customers looking for the highest quality possible for the lowest price, with rice and lamb products being the most popular, Petco's Asselin said.

At the same time, private label pet supply brands are likely to gain ground, Handelsman said. He pointed out that Wal-Mart's Old Roy dog food is the largest-selling brand in the nation, and if a consumer is in the store to buy some food, they're likely to buy some supplies.