Thumper the bunny rabbit and Sally the scorpion are coming to market; the stock market, that is. In what must rank as one of the more unusual stock market listings of recent years, Pet City, a chain of 34 out-of- town pet shops is seeking a listing on AIM, the Alternative Investment market for smaller companies. Dealings are expected to commence next month.
In addition to the standard fare of budgies, gerbils and guinea pigs, the warehouse-style outlets also do a nice line in iguanas, tarantulas, chipmunks and other "alternative pets".
A tarantula "starter kit", including glass case, thermal heated pad (and tarantula) is available at pounds 32.99. A Chipmunk kit costs pounds 99.99, while the more standard goldfish set is a bargain pounds 9.99. "We try and make our shops fun," says Richard Northcott, the chairman. "I defy anyone to bring a child and not buy anything."
Cats and dogs, however, are not sold. Customers are referred to breeders and rehabilitation centres instead.
Pet City is raising pounds 10m from the float which should value the company at around pounds 50m. It aims to spend the proceeds on expansion. The group is planning to open 300 of the 15,000 sq ft outlets by 2003 and capture a large slice of the fragmented pet shop market. The company made operating profits of pounds 20,000 on sales of pounds 45m in the 12 months to July but has been spending the bulk of its profits on opening new stores.
Mr Northcott says Pet City, similar to American stores PetCo and Pet Mart, could become the pet equivalent of Toys R Us, a "category killer" that becomes the destination shop for pet provisions. The UK pet market is worth pounds 3bn a year and there are around 600 independent pet shops.
Pet City was founded in 1989 by Roger Pedder, now chairman of Clark's Shoes and Giles Clarke, Pet City's chief executive, who founded Majestic Wine Warehouses. Mr Northcott founded Dodge City (the DIY chain that was later renamed B&Q) which he sold to Kingfisher in 1981 for pounds 20m. "The pet market reminds me of the DIY market in the 1970s when there were no really big players" he says. However, the group will have to overcome strict planning regulations on out-of-town developments if it is to reach its expansion target.
Retail analysts were withholding judgement on the chain's prospects."I suppose people might drive out of town if they can get things cheaper for their pets," one said. "But do people comparison-shop for lizards?"Reuse content