Animal lover Manuel Yap muses about the time he and a friend set up a pet shop.

Text and photos by Manuel Yap

In 2003, my good friend Ming and I decided to venture into business together. He is into cars, while I am into fiberglass, so we wanted something completely different. As we talked about it, we learned that ever since, we both wished we could own a pet shop. That was how our project was conceptualized.

The first thing we decided was, what would make our pet shop unique? We visited other pet shops and even travelled outside the country to get more ideas. We located a place in Quezon City, mapped out the master plan, created the store layout, and implemented everything. We really enjoyed setting up the store and our friendship grew. But in a little under a year of operation, we slowly began to feel that our sales could not compensate for our expenses.

This was a major concern of my good friend (and fellow Animal Scene columnist) Johnny Filart when I consulted him. He told me that I have to be very careful with my operating costs, specifically, the rent and utilities. My friend and I had other businesses so we could not focus only on the pet shop. In the end, we decided to close it down and continued in the hobby of pets. Lessons learned from my pet shop business venture:

Lesson 1: The basic Ps of business

Price

• It should be competitive, especially for the same brands, but not so low that they cannot deliver the desired profit margin

• There should be a balanced mix between standard and high value products Place or location – consider the following • Neighborhood

• Nearby malls or commercial areas

• Home base

Promotion

• Word of mouth

• Referrals

• Store promos

• Social media

People

• Who is your target customer? Consider gender and age

• Very important: the staff operating the pet shop Product

• There are so many available products that will consume your display and add to inventory costs. Products you offer should be based on customer needs and your recommendations.

• Live animals are a great challenge. Most of them will grow fast in your display. Others, if not taken care of, are prone to diseases. This is one of the major factors a pet shop owner should give importance to.

Lesson 2 – Good relationship with suppliers.

They:

• Provide us with the best credit lines if we have a good relationship with them.

• Recommend fast moving products

• Provide healthy animals

• Can agree to returns on non-moving products after a particular time period

Lesson 3 – Positioning.

You should:

• Know your target market

• Focus on what they want

• Grow on that focus

• Be an expert in that fieldWe focused on a fish-only store with categories such as koi, goldfish, monster fish, motoros, Cichlids, and marine. As I mentioned in my previous column, I won awards in cichlid competitions.

I also have my own breeding collections of cichlids. Eighty percent of my sales went into cichlids and their product accessories. A great lesson I learned was to invest 80% of your capital, time, and other resources where you know you will excel.

Lesson 4 – System.

You need to establish the following systems:

• Purchasing

• Inventory

• Store operation

• Sales

Lesson 5 – Customers

Dream petshop.

• Customer count – Increasing the number of customers who visit the store. Malls and commercial areas present this advantage. A neighborhood pet shop has this limitation.

• Customer retention – No matter how many promotions we hold to get new customers, having them return is more important. Pet shop staff service and product lines play a major role in retaining them.

• Customer growth – Maximize each customer by going the extra mile when it comes to product updates and benefits; this will ensure a sales increase and even referrals.

When we presented a gallery of maximum size cichlids in our pet shop, the customers tended to better appreciate the value of the small ones. Customers know the basics of what they need; pet shop owners can show the customer the real value of what they are missing. Most pet shops owners sell only what the customers need instead of educating them on what more it can offer.

I surveyed various social groups as to what they look for in a pet shop and the following were their top answers:

• Price

• Location

• Staff – friendly and knowledgeable

• Store management

• Product variety

• Animal condition

During the April 2016 Aquafiesta show, I was able to have an informal talk with a friend who is the pet shop owner of Sam’s Lagoon, Toto Magturo. He dreamed of having a pet shop as a hobbyist himself, and finally decided to make the dream into reality in May 1996. Sam’s Lagoon started in Retiro near Cordillera Street, with an initial shop area of about 2 square meters by four square meters. You could not imagine how such a small space could be transformed into a pet shop.

But the dream and passion were bigger than the area it occupied; I know, as I am a living witness since I personally dropped by his place to buy items from him. With much perseverance, the business grew and has since transferred to a more conducive location, still on Retiro Street but near Banawe. The area now is almost four times that of the previous one. What I learned during our discussion:• He prefers to have an inventory that is 80% devoted to fish, specializing in arowanas.

Taking on more animals—such as birds, dogs, and reptiles—would require that he get more in-depth information on each, which will make it hard for him to focus on customer-specific needs.

• 20% of his other items are for other pet needs, such as those of dogs, since they are requested by his customers.

• He is hands-on as much as he can when it comes to attending to his customer’s needs; while this is greatly appreciated, this also prevents him from expanding his business.

• Pet shop challenges include staff turnover, product and fish supplies availability, and fish mortality.

• His staff members are trained on the basics of pet keeping. For more advanced inquiries and problems, Toto prefers to reply directly to his customers.

• Competition in business is healthy if professionalism is practiced. Badmouthing one’s competition makes the industry unhealthy. Another friend of mine, Dr. Glenn Angeles, ventured into the pet shop business. He opened the pet shop “The Big Fish Place.”

Lesson 5 – What I learned during our discussion:

• He started in 2011 with two other friends. Their reason for opening such a business was to offer quality fish to hobbyists.

• Major challenges were looking for a good location and finding knowledgeable staff. Knowledgeable and caring staff members are difficult to find. You really need to train your staff to read more about basic fish keeping: what fish are compatible with which, and product knowledge is important.

• He intends to overcome the challenge presented by the need for knowledgeable and caring staff members by creating an operations manual for the staff members to read so that day-to-day operations at all branches will be easier, particularly regarding the training of the staff members regarding fish and encouraging them to read more about fish keeping.

• Currently, he has three branches, and plans to add more by the end of 2016.• He finds joy in introducing quality brands to the Philippine market.

• He has plans for the next few years; these include bringing in small animal, dogs and cat, and reptile products.

• Competition is always there. You need to keep on innovating.

• He advises aspiring entrepreneurs that if they really want to mix their passion with business, go for it. The road will be bumpy at the start but all will fall into place as you go along. In my previous corporate experience in industries such as paint and fiberglass, we participate in specific organizations. The main goal is to raise the standard of the industry.

Toto and I contemplated the idea for the pet industry to have an organization that aims to set bylaws and standards to make it more professionalized. There are many untapped opportunities in the pet shop industry.

Here are just a few of them:

• Products and set-up services

• Single animal specialty store• Franchise-able pet store• Home-based alliance pet store

• Online pet store

• “Cartimar” of the North

• Mall-based kiosk store

The hobbyist normally jumps into the pet shop business with passion as their main motive for engaging in it. This is a bad idea unless the pet shop is set up for trial and discovery, with lots of backup capital. The sad part is, the burden of paying the monthly bills takes away the enjoyment in the business, and sometimes, these cause the passionate hobbyist to let go of the hobby itself.

Would I venture into a pet shop business again? Yes! Just to be sure, I put entrepreneurial knowledge before passion.

All of my articles are based on my research and personal experiences. For questions, please email aquarium_zen@yahoo.com.

This appeared in Animal Scene’s June 2016 issue.