Text: Yulia Dolzhenkova, Alexander Kolchin
New reality triggered new trends in Russia – people are massively acquiring subsidiary farms and starting to breed poultry and other farm animals. Increasing demand for products for them allows pet stores to expand assortment and provides new opportunities for the pet market development.
Why is farming emerging in the regions of Russia?
It was always a popular hobby, especially in rural areas of the country, to breed and keep chickens, geese, goats and other agricultural (productive) animals. It stopped to be a fashion in ‘fat’ years, started somewhere in 2007, when many people rushed into businesses, when they were making good enough money even if they were just employed and acquired new hobbies like going out for the weekends, travelling, etc.
After another economic crisis in Russia in 2014, the living standards collapsed, and people were forced to give up costly entertainment and find new and more affordable ones. Some had to go back to growing ‘food’ themselves. Farming became popular again. The other trigger for that was people’s concern in natural, clean and healthy food to eat.
And the latest significant driver of farming was the pandemic, when people got more free time, less money and still a desire for healthy nutrition.
New opportunities captured
Where to buy food and other stuff needed? New Russian ‘farmers’ massively rushed to pet stores.
Specialty pet retailers respond to this trend by expanding their assortment with products for farm animals and poultry, such as animal feed, mineral supplements for birds and rabbits, veterinary medicines, and so on. On the other hand, those stores whose customers are mostly farmers are launching products for pets as well. Thus, the combination of two product categories becomes a trend in both types of stores.
E-com has also been affected by these changes. Many online players, like magizoo.ru, kormzoo.ru, pettown.ru, offer a wide range of food and accessories for chickens, goats, rabbits, cows and pigs.
From a hobby to a mini-farm
In those pet stores that have grown out of the agricultural business, selling products for productive animals is not only a tribute to the times, but also a tradition.
The Tyumen company called Sibvet launched products for farm animals in the early nineties, when the state entity Zoovetsnab could no longer satisfy the needs of the market. In 1993, the first Sibvet veterinary pharmacy was established, later the company opened several more veterinary pharmacies in village veterinary clinics.
Veterinary pharmacies gradually expanded their assortment with all sorts of pet products. Later, Zooray pet retail chain, run by Sibvet, appeared in Tyumen and other cities of Western Siberia. Now they offer products for both domestic and productive animals. At the same time, wholesale trade in agricultural livestock products remains an important line for Sibvet’s business.
It is critical to select the right assortment, so that the buyer can easily buy everything they need in one place.
“If the store is planning to place a range for productive animals, it should have at least 300 sq m area. Equipment, means for maintenance, bags with compound feeds and other goods require a lot of space, – comments the Sibvet owner Evgeny Kolomoitsev. – These goods is a perspective niche, but it requires financial investment and competence. The store’s consultants should have competence in the agricultural cultivation of animals and poultry, and give competent recommendations. In our company, these are people who have worked as veterinarians at farms for 10–15 years. The other issue is that a specialist in productive animals does not always understand the dogs and cats care issues. Therefore, we try to separate the segments of productive animals and small pets,” continues Evgeny.
Sales of products for farm animals in Sibvet increased by a third within this year. These are products for raising chickens, feed for calves and piglets, and mineral supplements.
The increase in demand for products for productive animals is also confirmed by Gora LLC, which runs Kormilec chain in the Moscow region. In the nineties, the company sold compound feed to collective farms near Moscow, and later engaged in wholesale and retail trade. To increase the interest of customers, the store’s range includes products for pets, gardening, and veterinary medicine. Currently, 11 Kormilec pet stores are operating in the Eastern part of the Moscow region.
Nikita Kabanov, Deputy Commercial Director of Gora, said that the main sales in market research are for grain and mixed feed for birds. “Our clients are small and medium-sized farms, amateur breeders, poultry farmers,” says Nikita. – Pet supplies demand in our stores is constantly growing. We focus on economy and mid-price products, due to demand in small towns close to Moscow. Our customers are both pet owners who do not have farms, and farmers who have cats and dogs”.
Both feed and treat
Veterinary clinics and pharmacies also report interest in productive animals. “The segment of products for farm animals has existed in our country before,” – comments Galina Chulkova, the owner of the chain of clinics and veterinary pharmacies in Volgograd, – but it wasn’t very well developed. In Volgograd and the region people living in the private sector have recently started to have chickens, goats, and even cows. Apparently, to feed themselves in such a difficult time. We immediately responded to this trend and expanded the range of products, feed and services for productive animals”.
Oleg Andreev, General Director of Simbio, states an increase in interest among cat and dog breeders in products used for disinfecting premises where farm animals are kept. In this regard, Simbio decided to offer pet stores a new Lodi product for the extermination of harmful insects, flies, cockroaches, fleas, etc. in the premises.
Manufacturers of veterinary products also indicate the increase in demand. Leading Russian companies in this segment have long been producing and actively promoting small packaging of veterinary products and feed additives for productive animals in pet stores. Today, the demand for this format of packaging from owners of private farmsteads and farms with small livestock is growing. According to Apicenna company, in 2020, sales in this category increased by 50% compared to the same period last year. Ivan Stepakov, sales and marketing Director at AVZ, confirms the same trend.
Wholesale and distribution companies have also started to buy products for productive animals more actively. Ivan Stepakov noted that veterinary products are now being included to the range of many city veterinary pharmacies and generated a serious demand growth for those.
Cross point
It is unclear yet how far the integration of different segments will go. It is also an open question to what extent pet stores and veterinary clinics will be able and find reasonable for themselves to specialize in a new segment.
According to Evgeny Kolomoitsev, a good service and a large range of products for productive animals should be provided by specialty stores, and pet stores can only cover part of the segment.
Anyway, now the demand for goods for productive animals in pet retail business is higher than ever. And despite the fact that the markets for pet products and products for farm animals are very different, businesses can find additional opportunities at the point where they cross.
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