The clever copy cat

Discount Store News, Dec 8, 1997 by Robert Scally

Petco's mantra is customer convenience, and that translates directly into how the individual stores (within Petco's diverse store base) are merchandised.

"Convenience is the most important factor for us. We want to be where people are shopping so we can catch them when they're out making a frequent shopping trip," Asselin said.

"We'll take a site that is smaller [than the prototype] because we know we can put our assortment in there," he said. "In addition, we have some stores that are over 20,000 sq. ft.

"We have a national assortment that basically goes everywhere. Then, depending on the size of the store, we sku up from there, and on top of that there are selected items that go into regions where they do well," he said.

Because Petco's competitors are both numerous and diverse, Asselin said he tries to look at all of his competitors to see what they're doing that will work in Petco stores.

"From a product assortment point of view, we look at a lot of the specialty retailers and the moms and pops," Asselin said. "We've learned a lot from aquatic stores, bird and reptile and small animal [stores], and we pay a great deal of attention to them and try to understand as we competitively shop those stores for what kinds of things that we could incorporate into our stores.

"As we have acquired stores, we have found what was strong in those stores. A good example is wild birds," Asselin said.

Petco recently acquired a pet supplies chain in the Washington, D.C., area that had a highly developed business selling supplies for feeding wild birds. Petco was able it to take that chain's wild bird concept and apply it to other stores in the chain where it was appropriate, Asselin said.

"We've done things like this with a number of different categories," Asselin said.

Another example is Petco's pet treats bar, which is featured in the chain's current prototype stores. Configured somewhat like a salad bar for humans, the pet bar is stocked with doggie treats and other similar pet snacks.

"We picked that up from the Just For Pets stores in the greater Boston area," Asselin said.

"We're very focused on the future, and that's one of the things that's very exciting about this business," he said. "It's a very large business; our stores are growing rapidly, but there's still so much potential, particularly as people become aware of the category."

Pet owners are drawn to Petco's stores to purchase premium pet foods, Asselin said.

"They see premium foods and the health benefits for their pets, and in the process they're exposed to a range of other products that they may not have previously known about," he said.

Accordingly, Petco has picked up on new consumer trends and moved beyond dogs and cats and expanded into birds, fish, small animals and reptiles. "We carry an edited assortment of live stock, but also a full range of the dry goods that go along with it," Asselin said. "It give us a very nice complement to our sales margin.

"In the broadest sense, we believe in a good/better/best philosophy," Asselin said. "But not every category justifies that. Where appropriate, we try to have something that will cover the need. We're focused on the products that we know comfortably, that we can sell that provide a very high margin.