2H 2023 Deal Hound M&A Report

It’s a long-held tenet that the pet services and products sector is “recession proof,” immune to the laws of economic gravity. People love their furry buddies, and they want what’s best for them. But 2023, and perhaps 2024, may be testing pet parent wallets. Consumers have been fighting inflation as pet product manufacturers deal with rising input costs. You can’t address costs by suggesting someone “not feed your pet,” one analyst noted, but consumers can, and apparently did, seek less costly private or off label nutrition and toys. And the “pet pandemic effect,” people adopting new friends as they were working from home, may have peaked. Still, more than two-thirds of American homes have a pet, and pet ownership rates have been rising for three decades.