The pet retail industry has experienced remarkable growth in recent years, becoming a booming sector that continues to captivate consumers and businesses alike.
As more people consider pets as beloved family members, the demand for quality pet products and services has skyrocketed. Pet owners now prioritize not only basic pet care but also premium products, innovative technology, and unique services to enhance their pets’ well-being.
This surge in spending reflects a significant shift in consumer behaviour, with pet-related expenditures reaching new heights.
Several factors have contributed to this growth, including the increasing number of pet adoptions in recent years, a growing awareness of pet health and wellness, and the rise of e-commerce platforms that make pet products more accessible than ever before. Moreover, the pet humanization trend, where pets are treated with the same care and attention as family members, has played a pivotal role in driving the demand for high-quality pet food, luxury accessories, and personalized services.
Looking ahead, the future of the pet retail industry appears bright. Innovations in pet technology, such as smart pet devices and health monitoring gadgets, are expected to continue gaining traction. Sustainability is also emerging as a key focus, with eco-friendly pet products and services leading the charge. Additionally, the rise of subscription-based services and direct-to-consumer business models will likely reshape the retail landscape, making it easier for pet owners to keep their furry friends happy.
As the industry continues to evolve, staying on top of the latest trends will be crucial for businesses looking to capitalize on this flourishing market.
Here are the top five trends driving the future of pet retail:
- Pet Health & Wellness Products – An increasing focus on nutritional pet food, supplements, and wellness products aimed at improving the overall health of pets.
- Sustainable & Eco-Friendly Products – Consumers are increasingly prioritizing eco-conscious and biodegradable products, leading to a rise in sustainable pet care solutions.
- Pet Tech Innovations – The growing demand for smart pet devices, including trackers, automatic feeders, and health monitoring gadgets.
- Personalized Pet Products – Customizable pet items, from food to accessories, reflecting a shift toward personalized experiences for pets.
- Online & Subscription-Based Services – E-commerce platforms and subscription services continue to grow, making it easier for pet owners to receive products on demand.
The pet retail industry is poised for even greater success in the years to come, driven by passion, innovation, and a deep love for pets.
Richard Maltsbarger, CEO of Pet Valu, said although the industry had a slightly below-average year last year with industry growth at approximately 3% to 4% the industry is still “pretty solid.” The long-term average for the industry is generally around 5% to 6%.
“We’re expecting roughly 3% to 5% market growth again this year. I’d say it’s stable but just a little uncertain, given the overall uncertainty for the consumer in Canada,” he said.
“We’ve had a really good run. Over the last five years, we’ve seen more than 100% revenue growth. This growth has been supported by really strong same-store sales growth for many of those years. We had a 5% same-store sales growth in 2023, we were just a bit below flat last year, but we’re expecting another 1% to 4% same-store sales growth this year. We’re expecting revenue growth closer to 7% to 9%. Part of this is due to a 53rd week year, so even without that, we would still be expecting revenue growth above 5% this year. Overall, we expect a relatively solid market.
“We are seeing a bit of a bifurcation in the consumer market. We’re seeing really strong results in our culinary products, such as frozen raw, freeze-dried, and gently cooked products. We’re also seeing strong results in our super-premium holistic kibble. However, we are also seeing some consumers seeking more value. For us, that’s reflected in our entry-level natural products, similar to grocery store premium food, like our Performatrin Naturals.”
But Maltsbarger said the market is also seeing customers looking for value, and the business has adjusted its go-to-market strategy to meet their needs.
According to Statistics Canada, Out of 12.2 million households that own a dog(s) and/or a cat(s) and a cat/dog population of 17.2 million in Canada, 50.9% owned a cat(s) compared to 49.1% whom owned a dog(s) in 2024. Over the year in Canada, the total pet population consisted of 8.9 million cats, 8.3 million dogs (majority large dog – 43.5%), 2.5 million birds, 8.6 million fish, 1.2 million small mammals, and 274.3 thousand of reptiles.
In 2023, Canada exported to the world a total of Can$963.3 million (217.1 thousand tonnes) in dog and cat food products – put up for retail sale, and Can$143.5 million (125.6 thousand tonnes) in canary seed – which grew at a combined value compound annual growth rate (CAGR) of 5% (2019-2023).
Over the year, leading Canadian provinces exporting the most in value exports of dog/cat food & canary seed were Ontario (44%), Alberta (22%), and British Colombia (14%). Top global export markets from Canada included the United States (Can$561.0 million), China (Can$54.8 million), and Mexico (Can$49.1 million) in 2023.
In 2024, food retail sales in the Canadian market totalled Can$6.7 billion growing at a CAGR of 10.0% for sales of dog & cat food (Can$6.6 billion) and at a CAGR of 8.1% for sales of other food (Can$122.0 million) between 2019 and 2024. Dog food sales accounted for 66.4% of the total market share within the sector, followed by cat food (31.8%), fish food (0.8%), bird food (0.7%), and small mammal/reptile food (0.4%) in 2024.
Bruce Winder, a retail analyst, said the Canadian food and accessory market has grown significantly over the last decade, and we can expect this kind of growth to continue.
“Why? Millennials are opting to have a pet instead of having children. Baby Boomers and Seniors are also getting a pet for companionship,” he said. “In addition, the premium pet food and accessory market is projected to grow even more as customers see pets as a family member and want to ensure their dog or cat is happy and healthy.
“You just need to look into your local Canadian Tire store to see these trends in play. The storied retailer has shops within shops with much greater linear footage, brand names and price points on offer vs. 10-15 years ago. PetSmart has done a great job as a category killer within the market which includes a massive assortment and services such as pet dog grooming, dog birthday parties and pet hotel services.”
George Minakakis, Founder and CEO of Inception Retail Group, said the pet Industry is one of the healthiest retail and service sectors imaginable.
“I’ve consulted in this sector. Over 60% of households have pets, which are part of the family. However, all sectors, including food and pet care, such as grooming and boarding, veterinary, and even insurance companies, benefit from the growth.
“I’ve seen large food distributors being acquired by private equity. The industry is estimated to be between $11.0 to $13.0 Billion annually. A great deal of consolidation is happening with veterinary clinics, and the costs to pet owners are increasing.”
And, Minakakis added, you have new operators who plan to open large hospitals offering significant inclusive services.
“I know of families that have spent thousands of dollars on their pets because they are so emotionally attached to them. This industry is fascinating, with significant future demand. Revenue is coming from retail stores, clinics, and online,” he said.
“This growth is tied to the humanization of pets and the premiumization of services and commercialization created by consolidation. It is more akin to what is happening in the dental industry, which has also been consolidated over the last decade. There are always growth challenges, but the industry is working through them and always looking to manage the pet owners’ experience.”
Monika Blachut, with Fairfield Commercial Real Estate, is a dog owner and says she thinks that the industry will continue to thrive in Alberta, albeit not necessarily grow, but definitely maintain current market cap.
“We may not see an increase in pet licenses, but what we are seeing is that many people view their pets as true companions and many are doing research on the benefits of cleaner eating – there will always be a market for the grocery store food brands, but just as with human food, many pet owners are reading the ingredients and are opting for specialty, cleaner ingredient options that only specialty stores offer,” she said.
“It will be interesting to see how the tariff’s impact the business though, many products are American made – the stores may need to seek Canadian options to fulfill demand and navigate price changes. I noticed there are a lot of options coming out of Quebec – dehydrated and freeze dried raw food is gaining traction and many Quebec farmers are providing options.”
“Over the past few decades, the percentage of households that own a pet in Canada has grown and the numbers are increasing,” says Jeewani Fernando, provincial consumer market analyst with the Alberta government. “Not only has pet ownership increased, but more owners are also treating their pets like family members. In addition, there is greater demand for higher quality and more natural pet foods and treats. And as pets have become increasingly important members of the family, their owners are spending more on pet food.”
With rising ownership trends, Canadian pet food and treat producers have grown as an industry over the years. Retail food sales experienced positive growth recently despite the effects of COVID-19 on the Canadian economy. It is expected the ownership trend will continue. In 2023 alone, more than a million Canadians are expected to add a pet to their household. This suggests the population could continue to increase, and demand for food and other goods and services will continue to grow, according to Fernando.
“Given the expected continued growth of pet populations, ownership and pet food retail sales, both domestically and internationally, Canadian pet food producers have an opportunity to maintain and increase their presence and distinct brand image within both domestic and global markets.”
Fernando said there are several trends in the Canadian pet food industry:
- increasing demand for premium food products with the humanization trend
- Canadian manufacturers focusing on premium food
- premium foods featuring local ingredients
- smaller local companies performing well
- e-commerce sales increasing
“Catering to the pets-as-family trend will continue to be an important marketing strategy into the future,” said Fernando. “As owners seek to provide pets with a happy and healthy life filled with human-like products and experiences, the market will continue to grow. There is significant opportunity for companies to develop innovative, premium products with customized formulas and functional ingredients focused on health and wellness.”
Maltsbarger said the long-term growth in the industry has been driven primarily by the humanization of pets. As we bring them closer to us as family members, we tend to buy them higher-quality products. Thirty years ago, dogs used to live in the doghouse. Now, the only people in doghouses are boyfriends and husbands, he joked.
“The dog has moved from the doghouse into the house, and possibly even into the bedroom and onto the bed. As we bring pets, particularly dogs and cats, closer into our lives, we are buying better products for them, including more human-grade ingredients, higher-quality toys, and more durable supplies. This has been the largest factor driving long-term growth in the industry, and it’s still true today.
“What we saw during COVID was a few years of abnormally high levels of pet adoptions, but that has now normalized. We are back to our long-term average of about 65% of Canadian households having a pet. So, while we saw adoption levels a bit higher during COVID, they’ve now returned to pre-COVID norms.
“We continue to expect long-term interest from pet owners in improving the quality of the products and supplies they provide for their pets. We’ll keep leaning into that.
“We also think the future will be an omnichannel retail environment, where customers want to have the full choice of buying from the same retailer, either online or in stores. Our omnichannel customers—those who buy both online and in-store—spend four times as much and visit five times as often as our online-only customers. So, we expect quality will continue to be a focus, and access to both in-store and online shopping will be important.
“We also expect the role of pets in families will continue to grow. We’ll keep opening around 40 stores a year, as we see an opportunity to have over 1,200 stores in Canada. We recently opened our 835th store, and we’ll keep opening about 40 stores annually. We’ll also continue reinvesting in our older stores and aim to be there for customers both in-store and online.”
According to IBISWorld, Canada’s pet stores have performed strongly in recent years. Cats, dogs, fish and birds remain popular home companions and owners are increasingly spending on their care. High existing ownership rates, combined with an increasing number of new parents, have supported demand for industry products. During the pandemic, demand for animal companionship and the required products spiked. Even after COVID-19, demand for products and services remained high, although revenue increased slower. Over the past five years, industry revenue is expected to grow at a CAGR of 3.8% to $3.8 billion, including an increase of 0.4% in 2024 alone. However, industry profit decreased over the past five years as wage growth outpaced revenue, said a report.
Traditionally, small and independently owned stores have endured mounting competition from supermarkets and mass merchandisers. In addition to luring consumers with competitive prices, these retailers offer the convenience of one-stop shopping. In response to heightened competition, pet stores have emphasized specialty services, like one-on-one consultations with pet nutritionists and veterinarians. Grooming and premium boarding options have also grown in popularity as stores aim to leverage their price-premium retail space and increase foot traffic. Also, pet stores have become actively engaged in community initiatives and partnerships with animal shelters, charities and adoption services. Such involvement helps raise consumer awareness and drives foot traffic to pet stores, noted the report.
Through the end of 2029, stores will maintain strong growth, although at a slower rate than the previous period. As the economy continues its upward trajectory and pet ownership continues to rise, revenue will be supported by strong demand for pet products and services. However, competition from supermarkets and discount department stores is expected to accelerate, limiting demand and threatening profit growth. Consequently, industry revenue is expected to increase at a CAGR of 1.4% to $4.1 billion through the end of 2029, added the report.
Trends and Insights according to IBISWorld:
- Pet ownership rates have increased over the past five years, benefiting pet stores. This trend was driven by consumers having increased leisure time during most of the period.
- Pet food is the largest product segment in the industry. The non-discretionary and frequent nature of purchasing pet food keeps demand for this segment high and steady.
- The geographic distribution of the Canadian Pet Stores industry closely follows the distribution of the population. The number of pet stores is primarily dependent on the number of households in each region because it generally increases the number of pets in the area.
- Pet stores compete with each other based on price, quality and product selection, similar to most retail industries. Customer service is also a key point of competition, given that consumers are particular about their pets.
Related Retail Insider stories:
- Pet Valu describes 2024 as a ‘dynamic year’
- Ren’s Pets Expands Canadian Presence with More Ontario Stores Planned for Spring 2024 [Interview]
