How does online competition affect buying an independent pet food store?
Treat online competition as a set of things to check. Find out which of the store’s brands online sellers and chains also carry, whether the store runs its own delivery or autoship program, whether it holds any brand exclusives, and how often its customers come back to reorder.
Pet owners can buy food from chains, online shops and independent stores, so a buyer of an independent store should ask what the store offers that a customer cannot easily get elsewhere. The answer lives in the shelves, the customer records and the supplier agreements, not in the seller’s opinion. These checks help you see it for yourself.
Which brands are shared
Go through the main brands on the shelves and see which ones online sellers and large chains also stock. A store that sells only widely available brands competes mostly on convenience and service. A store that carries lines found in few other places competes differently. Ask for the sales split between the two groups.
Delivery and autoship
Some independent stores deliver or offer a repeat-order program. Ask how many customers use it, how orders are taken and who does the deliveries. If the owner personally handles it, plan for what happens when you take over. Review how the stock is counted too; our page on counting pet store stock at closing covers that.
Exclusive lines and supplier terms
If a brand supplies only a few stores in an area, find out whether that arrangement is written down and whether it continues with a new owner. Ask the brands directly, with the seller’s permission. Unwritten promises can disappear when the owner changes.
Reorder history
A pet food customer often buys the same bag again and again. Ask for reorder records, loyalty or points data if the store keeps any, and note how many customers buy food rather than occasional accessories.
Related reading
15 pages on the same subject, grouped by topic.
Due diligence
- Expert answerHow do I check a business’s supplier relationships?
- Expert answerWhat if there are no written contracts with key customers?
- Expert answerDoes a month-to-month tenancy affect the sale of a business?
- Expert answerHow do I check a pet store’s live animals and stock before buying?
- Expert answerWhat should I ask about a pet store’s relationship with its pet food brands?
Legal
Buying
- Expert answerHow do I take over a business after closing?
- Expert answerHow should I manage cash right after closing on a business?
- Expert answerHow do I check a pet supply store’s regular food delivery customers?
- Expert answerHow do I check a pet store’s delivery service for heavy bags of food?
- Expert answerHow do I check a convenience store’s neighbourhood competition from nearby chains?
Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentHow to conduct due diligence when buying a business
- 02Business Development Bank of CanadaGovernmentWhat is inventory
- 03
- 04Business Development Bank of CanadaGovernmentWhat are the steps to buying a business?
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