1. Overview of pet industry development
(1) Development of foreign pet industry
After more than 100 years of development in developed countries, the pet industry has formed an industry system of products and services including pet supplies, pet food, pet raising, pet medical care, pet training and pet insurance. In developed countries pet industry has become an important part of the national economy. At present, the foreign pet market has become a relatively mature market. In recent years, the global pet market has shown a trend of steady growth. According to the statistics of Euromonitor, in 2020, the market size of the global pet industry (excluding the pet service market) reached usd 142.132 billion, with a compound annual growth rate of 3.85% in the past decade.
(2) Development of Pet industry in China
China's pet industry has a short development time, but benefited from the development of national economy and consumption transformation and upgrading, the domestic pet market has shown a rapid growth trend in recent years. China's cat and dog consumer market grew from 14 billion yuan in 2010 to 206.5 billion yuan in 2020, with a compound annual growth rate of 30.88%, much faster than the global level, according to data from the 2020 White Paper on China's Pet Industry. China's pet industry is in a period of rapid development, the brand awareness of breeders is gradually enhanced, the pet industry "blowout era" has arrived.
2. Overview of pet products industry
Pet food, pet medical care and pet supplies are the top three major sources of pet consumption. From the perspective of the pet industry segment market, the domestic pet industry segment market pattern is gradually improving thanks to the increasing attention of pet owners to pets and the strengthening of consumption. At present, China's pet food is the main, pet supplies, diagnosis and treatment, bath and beauty supplemented by a diversified pet market ecology has emerged. Pet food (staple food, snacks and nutritional products), as the demand products for pets, accounted for the highest proportion in the consumption structure of pet food in China. In 2020, the consumption structure of pet food accounted for 54.70%, down from 61.40% in 2019. Pet diagnosis and treatment consumption ranked second, accounting for 16.20%; Pet products accounted for about 13.60% of the market size in 2020, up from 11.7% in 2019. Pet products are one of the segments with the fastest growth in consumption.
3. Market competition pattern of pet products industry
On the whole, after years of business accumulation and survival of the fittest in the market, the market concentration of products in developed countries is high, and the market share is mainly occupied by big international brands, while small brands have weak competitiveness. Wholesalers and distributors of pet products in developed countries mainly sell their own brand products through online or offline channels and have long-term and stable sales channels. Their products are mainly purchased by global supply chains and they do not set up factories for production. China's pet products industry is in the early stage of rapid development, the development time is late, the market concentration is not high. Pet disposable sanitary products industry is now in the stage of rapid development, on the demand side, as the resident population increase, the improvement of living standards, the number of pets increasing in our country, people to pet consumption concept also changed, more and more producers choose to buy pet professional pet health supplies, This further increases the demand for disposable pet hygiene products. In terms of supply, due to the rapid growth of the market, the number of enterprises in the industry continues to increase, the capacity continues to expand, and the total market supply shows an expanding trend. However, there are not many manufacturers with large scale, production quality and production cost, and the market concentration is relatively scattered. With the increasing market demand, the market size grows to a certain scale. After a period of accumulation and survival of the fittest, the market concentration of domestic pet hygiene products enterprises will gradually increase. The company is a pet disposable health care product manufacturer with good research and development, design and production capacity. It can sell products to domestic and foreign brand operators, and also sell its own brand (Lay's pet, Hushpet) products to the market. From 2018 to the first half of 2021, the export volume of pet disposable health care products, mainly pet pads and pet diapers, accounted for 33.22%, 33.08%, 36.33% and 34.48% of the export volume of similar domestic customs products respectively, approaching one third of the export market size and occupying a high market share. And showing a steady growth trend, the market position is relatively stable, market share ranking leading. At the same time, the company is also actively increasing the construction of independent brands, efforts to expand domestic independent brand sales business.
