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Making Private Label Superpremium petfoods competitive in a crowded market

Making Private Label Superpremium petfoods competitive in a crowded market. Serge Boutet , agronomist. Mondou Ltd. Manager Petfoods and Nutrition. People and pets. People tend to be surrounded more and more by pets Dogs and cats primarily Small rodents, exotic birds,

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Making Private Label Superpremium petfoods competitive in a crowded market

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  1. Making Private Label Superpremiumpetfoods competitive in a crowded market Serge Boutet, agronomist Mondou Ltd Manager Petfoods and Nutrition

  2. People and pets • People tend to be surrounded more and more by pets • Dogs and cats primarily • Small rodents, exotic birds, reptiles and fishes

  3. People and pets • Within the past 5 years, especially for dogs and cats • No more : « pet owning » • Now : « Pet Parenting»

  4. People and pets • Pets are family members • Taking care of family • Providing the best we can • Deep and profound HUMANIZATION change • Increased petfood sales

  5. People and pets • As we know : • World petfood market > $50 billion • USA petfood market > $17 billion (about 1/3 of world market) • Canada petfood market 10 % of USA market (approximately)

  6. People and pets • This great interest in pets has influenced: • # of pet foods / brands on the market

  7. People and pets • # of pet foods sales locations (# stores and outlets) • Grocery stores / Mass merchandisers / Pharmacies • Independent Pet stores / Pet food stores / Feed stores • Veterinary clinics / hospitals • Specialized pet / pet food retail chains • grew as pets and pet foods became more and more popular

  8. Private labels and Controlled brands • This trend brought retail chains to create their own pet food lines : • WHY ???

  9. Private labels and Controlled brands 2 main reasons • Bring customers back to stores • because National brands can be found at many different outlets (no exclusivity) • National brands would improve service to retail chain customers (more support / more $$) • because they became also competitors within their stores (with their own brands)

  10. Private labels and Controlled brands • Early age of Private labels / Controlled brands • Low end, relative to premium pet foods • Seen by National brands as harmless / inoffensive

  11. Private labels and Controlled brands • In the new millennium, pet food sales : • in the value added products segment • Premiumnization (improved National brands formulas in grocery stores / mass merchandisers / others) • in the super premiumsegment

  12. Private labels and Controlled brands • New era and new opportunity • Super premium pet food market dramatically increased: • by good nutrition awareness • by increased consumers demand

  13. Private labels and Controlled brands • Which retail chains could sell into the private label / controlled brand super premium arena? Large retailers such as: • (USA and Canada) • (USA) • (USA and Canada) • (Canada and USA) • (Canada – province of Quebec)

  14. Private labels and Controlled brands • Pet Valuand Mondou, two large Canadian retailers have paved the way in this super premium segment with product lines such as : • Performatrin Ultra (Pet Valu) • vetdiet (Mondou) • vetdiet-i(Mondou)

  15. Super premium petfood segment • How can these retail chain stores get there? • Have nutritionist / nutrition expert on staff or an excellent open minded consultant on board • Partnership • Conduct own research and development • Ownership of formulation • Have own kennel or direct access to partner kennel • Provide Education / Training

  16. Super premium petfood segment • Let’s dig a little further into the previously mentioned ideas…

  17. Who is doing pet food R & D ? • Supply companies/ingredients manufacturers • Vitamins and minerals premixes • Flavors • Functional or specialized ingredients (MOS, FOS, hyperimmunized eggs, etc.) • Pet Food manufacturers • Develop recipes (not ingredients) by using the same ingredients available to everyone • Universities • Large retail chain stores

  18. How is R & D done in pet foods? 5 MAIN WAYS TO PROCEED: • Companies with their own research facility • Teams of Nutritionists (for recipe development) • Veterinarians and AHT for animal health • Use ingredients from suppliers available to everyone • High costs, mostly corporations in the top 5 global petfood players

  19. How is R & D done in pet foods? 5 MAIN WAYS TO PROCEED: • Collaboration with Universities • Collaboration with specialized research kennels • Collaboration with ingredients suppliers / manufacturers • A mix of two or more of the above…

  20. A story of success and accomplishment SUPER PREMIUM Private labels and Controlled brands by large retailers 1st) an idea of concept comes with a dream … 2nd) an idea comes with one unique ingredient … then a second one … then many more … 3rd) an idea comes with … science … and … artpet food formulation is science based but also linked to the art of how to combine all novel ideas and ingredients together…

  21. SUPER PREMIUM Private labels and Controlled brands by large retailers Determine the right setup: First step : product development and formulation • Select special unique ingredients • Do not be afraid to be pioneers • Innovate by creating different concept / new ideas • Innovate by creating partnerships • with specialty ingredients suppliers • ask support from partners’ nutritionists and scientists

  22. SUPER PREMIUM Private labels and Controlled brands by large retailers Innovation comes with courage Without it…no employee can create… neither can corporations innovate…

  23. SUPER PREMIUM Private labels and Controlled brands by large retailers First step : product development and formulation • Select specialty ingredients suppliers such as : • (Highland, Illinois, USA) • (St. Charles, Missouri, USA) • (Golden, Colorado, USA) • (Lexington, Kentucky, USA) • (Kalamazoo, Michigan, USA) • (St-Hyacinthe, Quebec, Canada) • and many more … …

  24. SUPER PREMIUM Private labels and Controlled brands by large retailers First step : product development and formulation • INNOVATE by bringing together science and specialty ingredients • Create unique formulas with added values • Super premium pet foods are foods with added values

  25. SUPER PREMIUM Private labels and Controlled brands by large retailers When formulas have been developed and meet requirements Second step : select the right manufacturing partner • ability to manufacture super premium foods • have access to specialty ingredients • dedication to quality – very high quality standards • HACCP, AIB, etc. • ability to export to Europe, Australia, etc. … a plus for sure

  26. SUPER PREMIUM Private labels and Controlled brands by large retailers Protect your formulas (note that manufacturing partners often have also their own brand) • By developing sub-formulas (that I call pacs) • of unique specialty ingredients from different suppliers • Manufacturer is buying the pacs, not each ingredient (so, does not know the inclusion rates and levels) • brings nutritional complexity to formulation but simplicity for manufacturing • Then only your company knows it all !!!

  27. SUPER PREMIUM Private labels and Controlled brands by large retailers Selecting the right manufacturer In Canada, USA, South America, Europe or Asia many manufacturers are of high quality standards

  28. SUPER PREMIUM Private labels and Controlled brands by large retailers Third step : Feeding trials • Base trials on AAFCO feeding protocols • Palatability is to be assured as step one • Foods given are very secure for the animals • Add a control diet as comparison • Add other trials to it if needed • joint health... • urinary pH... • etc. ...

  29. SUPER PREMIUM Private labels and Controlled brands by large retailers Feeding trials • Kennel trials • Provides precise and direct values • Provides overall group information • This type of trial have some limits • Limited direct contact with animals • Limited evaluation on skin and coat • Limited time to acknowledge behavior / temper change • Limited time for regular daily activity of animals

  30. SUPER PREMIUM Private labels and Controlled brands by large retailers Feeding trials • Select kennel where you have direct access to animals • Reliable kennel with dogs and cats • Dogs in individual runs • Cats should be housed in groups of 8 to 10 (better results) • Have your own technical staff • Veterinarian • Animal health technicians

  31. SUPER PREMIUM Private labels and Controlled brands by large retailers Feeding trials • Home trials • Gives important subjective data • Second step feeding trials • Key to get additional information that is limited in kennel trials • Day to day, minute to minute contact with animals from people at home

  32. SUPER PREMIUM Private labels and Controlled brands by large retailers Feeding trials • Home trials • Best of all : work with own stores staff (and their animals) • Key success factors with own staff animals • Staff will connect strongly to product by being part of the development • Staff will provide key details on claims / results that kennel trials cannot provide • Staff will be ready to sell and believe in the effectiveness of product line when it will be on shelves

  33. SUPER PREMIUM Private labels and Controlled brands by large retailers Marketing Innovation in marketing by working closely with partners • Bring them with you if and where possible

  34. SUPER PREMIUM Private labels and Controlled brands by large retailers Marketing • Who knows best what consumers want than the retailers themselves ? • Pricewise, products can be extremely competitive • minimum overheads compare to National and International brands corporations • Provide Education to staff (stores personnel) in nutrition and on products

  35. SUPER PREMIUM Private labels and Controlled brands by large retailers Summary of development

  36. SUPER PREMIUM Private labels and Controlled brands by large retailers Conclusion • Private labels and Controlled brands of pet foods can be directed towards high end products / Super Premium foods • Large retailers with the right staff or close consultants + courage + innovative ideas combined with strong partnership ...

  37. is the key to the success of ... Making Private Labels and Controlled Brands SUPERPREMIUM petfoods competitive in a crowded market

  38. Serge Boutet, agronomist 10 400 Renaude-Lapointe Montreal, Quebec, Canada H1J 2V7 514-322-5300 ext.: 246 514-324-5257 sboutet@mondou.com Mondou Ltd Manager Petfoods and Nutrition

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