Chewy, the national retailer of pet food and products, has opened two vet care centers in metro Atlanta as it expands its online business into in-person service.
The centers that opened this week in Dunwoody and Sandy Springs are part of an ambitious plan to add hands-on, physical service to an $11.5 billion business that the Florida-based company has built almost exclusively on internet orders shipped to the customer.
Atlanta has the third and fourth Chewy vet centers, part of a “proof of concept” aimed at seeing if the idea can work for the company, said Mita Malhotra, president of Chewy Health. “We’ve said we would open four to eight this year,” Malhotra said.
The vet centers will focus — at least for the moment — on dogs and cats, she said.
That concept is a melding of the company’s technology and an emphasis on customer service, she said. “The company was born on the premise that we would combine electronic commerce with the personal service you expect in a local pet store.”
Chewy already has centers in Florida and Denver, and plans centers in Austin, Dallas and Houston, she said.
The 14-year-old company, best known as an internet site specializing in pet food and products, boasts more than 20 million customers. However, revenue growth has slowed and the company sees an opportunity in the hand-on-paw business of providing in-person medical and wellness care for America’s pets.
Pets live in more than 90 million U.S. households, according to the American Pet Products Association.
During the pandemic, many households added pets. Overall, dogs lead the pack: Americans have more than 65 million dogs and 46.5 million cats, followed by fish, birds and other animals.
“About two-thirds of pet owners say they spend more on their pets’ health care than on their own,” Malhotra said.
Current pet-owning tendency has been particularly strong among the large wave of millennials, who account for one-third of all pets, the group estimates.
Gen-X households represent 25% of pet owners, closely followed by the boomers, with 24%.
The result is that Americans this year will spend about $150 billion on their pets, including about $39 billion at vets, the group estimates.
But when it comes to in-person care, Chewy is hardly entering an empty market.
The nation has thousands of vet businesses and nearly 80,000 veterinarians, according to the Bureau of Labor Statistics. Measured per capita, metro Atlanta has slightly more than the average, with hundreds of vet businesses and about 1,600 veterinarians, the BLS said.
Like many industries, vets have lately been the targets of big investors hoping to buy up small, locally-owned businesses and create large, profitable chains. Between 2017 and 2022, private equity spent $45 billion to make those kinds of deals in the veterinary sector, according to PitchBook, which tracks investment data.
Part of the attraction, experts say, is that each center is small, privately owned and generally receiving direct payments from customers, since relatively few have insurance.
VCA Animal Hospitals has more than 1,000 vet hospitals and clinics nationally, including 17 in metro Atlanta, according to VCA. National Veterinary Associates has more than 1,400 veterinary hospitals and pet resorts across its network, with a spinoff company managing 145 specialty vet hospitals.
Chewy centers are also part of a chain, but the company argues that it offers something different, aiming for better-designed facilities and more personalization. The company says that can come partly through technology the gives the pet owner more information about diagnoses, treatments and medicine, but also through designating “concierge” staffers to connect with each customer.
Atlanta is especially attractive as a place to expand, Malhotra said. “It’s a market where people are very attuned to the care of their pets.”
U.S. pets, in millions
Dog: 65.1
Cat: 46.5
Other small animal: 6.7
Bird: 6.1
Reptile: 6.0
Horse: 2.2
Freshwater fish: 11.1
Saltwater fish: 2.2
Makeup of pet ownership by generation
Gen Z: 16%
Millennial: 33%
Gen X: 25%
Boomer: 24%
Pre-boomer: 2%
Expected spending this year
Pet food and treats: $66.9 billion
Supplies, animals and over-the-counter medicine: $32 billion
Vet care and products: $39.1 billion
Other Services: $12.6 billion
Source: American Pet Products Association
Credit: cus
Credit: cus
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