Dog and cat owners also resent inflation. Although companion pets have become “the kings of the home” since the start of the pandemic, their owners are looking for alternatives to deal with the rise in the prices of croquettes or cans. One of them is to reduce the amount of food purchased, even if this means making more visits to grocery stores.
Since the escalation of inflation, stores, markets and businesses in neighborhoods and neighborhoods have made room to add different brands of pet food to their offer: packages of Pedigree, Ganador, Dog Chow, Nupec, among others, are ready for bulk sales. A trend that has begun to displace the acquisition of packages of five, eight or even 20 kilos that can be bought in specialized stores and supermarkets.
Companies that market pet food are already noticing this change in trend. Carlos Posadas, president of Grupo Amascota, which integrates dog and cat food production companies, acknowledges that a percentage of pet owners already choose to buy half a kilo or a kilo of food, because their pockets have suffered the effects of inflation.
“There is a part of the market that prefers to buy weekly at the corner store, instead of a package of four or five kilos. And there is another part that buys the package of 20 or 25 kilos, people who can make that outlay and have some savings instead of buying many small packages”, he declares.
Paola Delgado, who directs the marketing area at ADM Animal Nutrition, a company that sells the Ganador and Minino brands, adds that in these proximity channels the consumer prefers to look for options, smaller presentations or bulk purchases, rather than change their brand, “because their dogs and cats are already used to a certain food.
Why is pet food going up?
The specialists consulted explain that the rise in raw materials, such as corn, logistics transport and packaging, has made it unsustainable to maintain the price of packages, although the companies assure that they are trying to generate efficiencies in production and transport in order to of not fully transferring the increases to the final consumer.
“The increases range between 4% and 6%, which is a limited figure versus what we have received (in increased operating costs). We have tried to improve (processes) to turn around (the increase in prices of raw materials)”, adds Delgado. Even in this context of high prices, which began in 2021, the company registered an advance of 6% in the volume of feed production and 8% in value at the end of last year.
In Mexico, the pet food category has a value of 50,000 million pesos and in recent years the market has maintained constant growth. At the end of 2020, the latest data available, consumption grew 8.1% to 1.2 million tons. Production also increased 8%, according to the latest data from the National Council of Manufacturers of Balanced Feed and Animal Nutrition (Conafab).
Small grocers and grocers are riding the wave. “It is a good sales niche because there is a great demand, especially for dog croquettes,” says CuauhtĂ©moc Rivera, president of the National Alliance of Small Businesses (ANPEC).
But, unlike specialty stores, neighborhood stores offer consumers to buy by the gram. “What reigns now in small businesses is the purchase of croquettes in bulk, there are very expensive brands, so people have begun to look for alternatives in stores and businesses in markets,” adds the representative of small merchants.
The commitment to wet food
In addition to bulk purchases, cans have positioned themselves as an alternative to rising pet food prices. The president of Amascota comments that this category has a production volume that is divided in half for dogs and cats, unlike dry food, which is 85% for dogs and 15% for cats.
For Delgado, from ADM Animal Nutrition, this is because these presentations have a more accessible price and allow them to complement the animals’ diet. The company, owner of Ganador, will start operations next year of its first wet food plant in Mexico.
In February, Mars Petcare, owner of brands such as Pedigree and Whiskas, announced the expansion of its wet pet food plant, located in Querétaro. For this, it will invest more than 2,000 million pesos in the following 18 months.
Amid inflation, companies still see room to grow. In Mexico, around 4.4 million dogs and 18 million cats are companion pets, but 70% still eat leftovers. “There is still a long way to go to reach every household in Mexico that has a pet,” says Delgado.
