China has become one of the most important pet markets in the world, having about 290 million pets in 2013 (number of European pets: ca. 270 million). Hand in hand with the rise in ownership rates (+35% since 2000), the expenditures for pet supply have risen: In 2013 the Chinese spent about 7.84 billion RMB and forecasts indicate that China will continue to rank among the eight fastest growing pet care markets in the world. Currently, the Chinese pet food market is dominated by Mars Petcare, having a market penetration of 37% in the dog food market (ca. 4 million RMB annually) and 45% into the cat food market (ca. 2 million RMB annually).
Looking at the distribution situation in China, the pet market is rather fragmented, i.e. there’s a multitude of small retailers, but only few specialized retail chains like e.g. the German retail chain “Fressnapf”. For the premium food segment, foreign owned chains and exclusive small pet supply boutiques are more relevant than other distribution channels.
Despite the relatively easy transportation requirements of pet food, its import into China is currently officially restricted due to meat quality problems in the past. Thus, the only way to import the products legally is by exceeding a long-lasting examination procedure by Chinese authorities. Therefore, pet supply manufacturers currently had to use other product areas to get a foot into the market, e.g. via pet fashion.
SWOT-Analysis of European high quality pet food suppliers in China:
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