BY B.C. HENSCHEN
Distributors play an interesting role in the pet food world. In the beginning, I mistakenly viewed them as a “store” I do
business with. I expected the same
customer service that I provide my
customers. Overall that’s what I
received. That’s because in the beginning I dealt with independent
distributors that were small business owners just like their customers. There are so many stories
featuring small distributors going
above and beyond.
Fast-forward a few years: Some
bigger companies came to town to
assimilate the little guys. I quickly
learned that they don’t really have
to provide stellar service because
exclusive distribution territories
don’t give me a choice when it
comes to picking who I deal with.
The No. 1 reason I have an
issue with megadistributors is
because I feel like an employee—
not a customer. Have you ever reviewed a distributor agreement?
It’s full of demands—order by this
date, meet the minimum, take de-
livery on this date, damages must
be reported within hours and so
on. With megadistributors, every-
thing feels inflexible.
One owner of a distribution
company told me how nice it
would be if I ordered online and
just had one delivery a week instead of two. I always made at
least the minimum, but he wanted to maximize efficiency. Sure,
online ordering is great for them,
but my point-of-sale system generates my purchase orders, and I
email them to my rep.
asked stores to only order by the
case UPCs and not the individual
UPCs on cans. My point-of-sale
tracks by the can, so when I make
an order, the purchase order will
request 12 cans. For years my inside sales rep was able to key that
in as one case with no problem.
Listen up, manufacturers!
Distributors really can affect your
brand. I’m very picky about what
I sell. I want to know ingredients,
safety assurances, manufacturing
processes and everything else I
can find out. I want to meet the
people who make the food. I also
consider a company’s distribution.
If it’s in an exclusive agreement
with a distributor I don’t want to
do business with or doesn’t have
other items that I want, I’m not
going to explore that food further
because I wouldn’t be able to ensure I could always offer good
inventory. Nothing is worse than
not having a food you spent weeks
getting someone to switch to.
The same holds true if I have
a bad experience with the distributor of an existing product. I am
going to slowly move away from
a brand that works exclusively
with a distributor I absolutely do
not want to do business with. I
understand the appeal of an exclusive distribution contract for both
manufacturer and distributor—in
the beginning. The manufacturer
needs its sales force to focus on
getting the brand out there more
than its manufacturers’ reps can.
The distributor doesn’t want to
jump into an unknown product
without assurances of moving it.
At some point, that brand will
end up being a line that the distrib-
utor is not giving as much focus
to, and at that point, dual distri-
bution should be allowed. What
also should be allowed from day
one is a backup distributor that is
allowed, even if by special exemp-
tion, to service a client when the
primary distributor fails.
I realize that these are all small-store problems—inside delivery,
no forklifts, small orders and many
phone calls make us a complete
pain that many megadistributors
would love not to deal with. What
both distributors and manufacturers need to remember is that small
stores can act as a major influence
on a product’s image. If you walk
the aisles of the big stores (and
I’m not talking megastores)—the
stores that order by pallets and
have a forklift to unload—know
that many of those foods first
showed up in microstores.
Can more manufacturers choosing dual distribution lead to a different
answer to the independent pet retailer-megadistributor equation?
B.C. HENSCHEN, a certified pet care technician and an
accredited pet trainer, is a partner in PLATINUM PAWS, a
full-service pet salon and premium pet food store in
Carmel, Ind. His knowledge of the pet food industry
makes Platinum Paws the go-to store for pet owners
who want more for their pet than a bag off a shelf.
“I wonder how my customers
would feel if I put up a sign that
said ‘Please point all barcodes
toward the clerk for simplified
checkout.’ My customers can
pile the cans in a basket and
place it next to the register. I am
more than happy to pick up that
basket and do my work. That
customer made a choice to do
business with me, I appreciate
it, and I will do whatever I need
to do.”—B.C. Henschen
HOW PETS AND HUMANS HAVE
BECOME EQUAL IN COMMERCE
The Micro and the Macro
PHIL CHANG is HUBBA.COM’S resident retail expert. With experience at
companies such as Johnson & Johnson, Unilever, Pfizer and Target, Chang
knows sales, buying, global franchise, price points, margins, the best products
in any industry, retail industry trends and analytics.
BY PHIL CHANG
Is the industry ready to talk about
the convergence of human and pet
brands? Consumers certainly are, and
it seems they’ve already spoken. The
pet accessories category is projected
to be a $91 billion industry by 2019.
Conversely, the baby care market is
currently at $47 billion worldwide.
Meanwhile, in more and more
countries, pets are being treated as a
companion rather than a household pet.
Studies have shown that when humans
look at their pets, they feel the same
emotional affinity as they do when they
look at their children. In fact, nine in 10
Americans say they consider their pet
to be a part of their family.
Furthermore, the average number
of dogs per household worldwide is 1.6,
while cats are 2.1. The average number
of children per household worldwide is
2. The number of children per household
has remained stagnant; pet ownership
has tripled in the U.S. since the ’70s.
All these statistics lead up to one
simple fact—pet products are changing.
Pet food, for one, is now more healthful,
all natural and ultimately mimics
human-food tastes and trends. We’ve all
seen claims of “fully cooked, all-natural,
human-grade dog food that is made to
order,” suggesting that these brands
have a higher-quality product than
standard pet food. As this market rises,
we can expect more products such as
Bowser Beer, The Bear & The Rat and
Natura Petz Organics to take the lead.
Natura Petz promises a better nutritional
supplement for pets, while Bowser Beer
and The Bear & The Rat give your pets a
human food experience.
These few examples drive many
questions regarding how and where
these products are going to show up on
mass retail shelves. Traditional pet food
sections currently have no space for
such products (which are still considered
niche or specialty), so what will retailers
do to expand space in order to get these
products on the shelves?