Pet economy is heating up day by day, industry: new opportunities for industry development

Industry insiders point out that in the coming years, the number of pets in China is expected to resume growth, while offline stores and pet hospitals will also experience rapid development. According to data, the growth rate of China's pet healthcare industry decreased from 17.8% in 2019 to 5.7% in 2020, but there was a strong rebound in 2021, with a growth rate of 27.6%.

At the same time, the Chinese pet market has undergone a long period of expansion. With the continuous acceleration of urbanization, the increasing demand and awareness of pets among the younger generation, and the increasing demand for companionship, the Chinese pet market is expected to enter a new stage of strong growth. Pets are also becoming an important member of more and more Chinese families.

According to the 2021 China Pet Industry White Paper (hereinafter referred to as the White Paper), "family" is the preferred role given to pets by pet owners, accounting for 85.1%. The staff of the pet store mentioned above also introduced to the reporter that the younger generation of pet owners are more willing to purchase high-quality pet food and supplies for their pets, and they also hope that pets can receive professional pet medical services such as regular physical examinations to extend their lifespan and improve their quality of life.

According to a research report released by China CITIC Construction Investment Corporation, the development of China's pet economy is at a high level. With the continuous decline of the Engel's coefficient of pet consumption and the upward trend of pet consumption upgrading, the proportion of pet diagnosis and treatment, pet supplies, pet nutrition and health care, pet services and other consumption is expected to continue to rise in the future. The domestic pet industry is still in a state of rapid development with unchanged fundamentals, and is optimistic about the long-term development of the industry.

According to data from the White Paper, the number of urban pet owners (cats and dogs) in China reached 68.44 million in 2021, an increase of 8.7% compared to 2020. In terms of market size, from 2021 to 2022, the growth rate of the entire pet market was 13.5%, reaching 396 billion yuan. As an important component of the overall market, the pet medical industry has also experienced rapid growth in recent years. According to professional institutions, the pet medical market size in 2022 is estimated to be about 64 billion yuan, a year-on-year increase of 17.4%. With the successive introduction of a series of national policies, the pet medical industry will also usher in further healthy and standardized development.

The above analysis suggests that the recent introduction of a series of national policies to promote the healthy and high-quality development of the industry is conducive to accelerating the elimination of some small and medium-sized pet diagnosis and treatment institutions with insufficient qualifications and disorderly management. At the same time, it also provides policy based development opportunities for national chain pet medical institutions. Recently, a piece of news has attracted the attention of the venture capital industry. The domestic pet medical platform Xinruipeng has recently submitted a listing application and plans to go overseas for listing. According to data statistics, since 2015, there have been a total of over 80 financing incidents in China's pet medical racetrack.

The platform has built a complete pet ecosystem, including three pillar businesses: pet medical services, supply chain services, and local living services. At the same time, it has also extended and developed other business sectors such as third-party diagnosis, veterinary continuing education, and industry level enterprise services. "The relevant person in charge of Xinruipeng introduced.

Analysts believe that there are two main reasons why capital is favored: firstly, based on the experience of developed country markets, pet consumption has the ability to resist economic downturn or even "countercyclical growth"; Secondly, pet healthcare belongs to the blue ocean market with low market penetration and significant growth potential. The demand for pet care is continuously being released, and the demand for medical care will significantly increase.

Taking Xinruipeng as an example, its total operating revenue increased from 3.008 billion yuan in 2020 to 4.784 billion yuan in 2021. In the first three quarters of 2022, the company's revenue was 4.315 billion yuan, with a year-on-year growth rate of 26.9%.

How to stand out in the competition of the pet medical industry in the face of such a vast future development track? Industry experts say that the concentration of China's pet medical industry is not high compared to the pet food industry, and the industry is undergoing a period of rapid integration. Pioneers with a complete ecological layout are expected to continuously expand their market share. Meanwhile, taking Xinruipeng as an example, a wholly-owned company that owns its pet hospital has the advantage of equity structure and has the decision-making power to operate the terminal of the diagnosis and treatment system, which is more convenient for unified intensive and compliant management.

With the continuous development and growth of the pet medical industry, the position of professional veterinarians in the industry is constantly improving, and they are being respected by more and more pet enthusiasts. The pet medical industry is constantly attracting fresh blood to join, and the educational level of practitioners is constantly improving. Major universities in China can send tens of thousands of high-quality professional talents to the pet medical industry every year.

At the same time, the cooperation between pet medical market institutions, universities, and vocational colleges will be further deepened to ensure talent input and provide internship and training opportunities. More and more veterinarians are entering the industry and their experience is constantly increasing, and the quality of pet medical services will be significantly improved.

Some institutions have pointed out that China's pet industry has enormous growth potential. On the one hand, the increasing demand for companionship has led to an increase in pet related consumption; On the other hand, the concept of pet raising has gradually changed, from extensive breeding to purchasing more specialized pet products. It is expected that the pet industry will maintain a good growth trend in the future.