What Do Pet Franchises Look For in a New Market?

As a franchisor, expanding into a new market is a beautiful thing. With each growth opportunity, the brand awareness spreads, new customer bases are unlocked and potential franchisees learn more about the business. But it’s not as easy as just deciding to take the franchise to a new state, signing a lease on a storefront and opening for business.

There are hours of research, due diligence and leg work to be done to make sure that this new market has everything the franchise needs to be successful. Many franchises have additional considerations to take into account such as special real estate needs, local regulations on their industry and demand for the services they provide.

Pet franchises are a perfect example of this. Here are some of the things pet franchises need to look for when expanding into a new market.

Pet-Friendly Demographics and Market Data

One of the first questions a pet franchise needs to answer before moving into a new location is: Are there enough people — and the right types of people — in this area to support the business? Of course, this means looking at the number of pet owners, but helpful data also includes income levels, commute distance, housing type, and overall economic growth of the region. 

Usually, pet franchises aim to be near at least mid-sized cities with reasonable travel times to and from higher density areas. People in the market also need to have enough disposable income to spend on things like pet daycare, boarding, grooming and training.

“When we’re looking to grow our footprint in a new market, the natural first step is to look at the dog-to-human ratio,” said Linton Dowling, marketing director of Raintree*, franchise development partner of doggie daycare franchise Hounds Town USA. “We then move into the economic prospects of that state and demographics. If we’re trying to project growth potential, we look at a number of economic data points such as employment rate, apartment/housing booms, employment growth and interstate population growth.”

Even though a new market might not have widespread awareness for the brand yet, ensuring that there is a solid potential customer base in the area will set franchisees and the company up for success as a whole.

State and Local Regulations for Pet Care

State and local laws can vary wildly across the country, especially when it comes to the pet care industry. Franchises and their legal teams should spend ample time researching not only state laws but county, city and town laws to ensure there aren’t any regulations that would inhibit operations.

“Every municipality has different regulations and zoning requirements,” said Mike Gould, founder of Hounds Town USA. If you’re pushing into a new state, find out their general regulations. When it comes to running a pet care business, some markets are antiquated with laws made in the 60s and 70s that haven’t been updated. Since our type of business (doggie daycare and boarding) didn’t really exist then, there may be some extra bureaucratic things to sort through before opening.”

Real Estate Space for Pets

Most franchises in the pet care industry need more than a typical retail storefront. For example, daycares and boarding facilities require large industrial spaces and groomers need space for specialized equipment. Once an agreement has been signed, franchisors typically work with local real estate brokers who know the area to find the right spaces in the best locations.

“Real estate inventory is a challenge,” said Gould. “Hounds Town USA franchises need a certain space, typically warehouse or industrial, which is a unique need and hard to find in certain markets. It’s also hard to predict when that sort of real estate will be available.”

For mobile pet franchises, however, it’s not so much real estate that’s the issue, but the commute. Dog Training Elite*, the 34-unit dog training franchise, operates on-the-go, traveling from client to client to provide services.

“Due to the mobile nature of our business, some markets will pose a challenge getting around the city,” said Aidan Rosequist, franchise support director. “Take New York City, for example. Traveling from one client to another may take quite a while, even though they may be a short distance apart.”

Opportunity to Meet the High Demand for Pet Care

The demand for pet services has never been higher, especially after the high adoption rates during the pandemic, which means expanding into new markets makes perfect sense for pet franchises. Doing so helps spread awareness of the brand overall and opens the business up to an entirely new customer base.

“Post-COVID, the need for daycare has never been greater,” said Gould. “But besides the growing number of pets, there isn’t a city or area of our country that isn’t in dire need of quality pet care. We’re growing leaps and bounds in every market. From my perspective, the country is wide open for development.”

Besides increasing sales and growing the franchise business, expanding to a new market means the pet franchise has the opportunity to add value to the community in its own unique way.

“One thing I try to get across to new franchisees is that dogs are now the equivalent of children,” said Rosequist. “Because of that, the pet industry is booming, and there is a huge demand to make sure those ‘children’ are good members of society. Relationships with other animal organizations can also be rewarding. The therapy and service dogs that we train can be valuable to the franchisee's community.”