I created a market analysis report for a client interested in entering a niche section of the consumer pet market in 2005. In 2007 I was contacted again to provide a second report that had updated market analysis information as well as market development work prior to them committing to costly product development.

This report was a detailed atypical assignment in that they required research and analysis of the market to a level that included final product price, yearly growth and penetration estimates for Melbourne and Sydney. A more challenging part of this project was the need to tie revenues to consumer residential locations (density) as this would affect the level of service resources they would need to provide.


While there are specialist companies that can provide traffic flow analysis for a given retail shop location, this assignment required a degree of lateral thinking that would mesh potential sales with consumer residential density living patterns.

The analysis also considered what business model would be required to provide a lucrative exit strategy, should the company choose to package its product as an ideal takeover option. Several different sales models and sales prices were explored for the client to assist them with understanding the benefits of each in regard to creating a long term company versus being an attractive takeover target.

“The base recommendation of this report is that by creating a company based on pure intentions of helping pet owners and concentrating on volume sales will position the company best to either continue growth or be purchased.

The issue of building a strong brand and good relationships with retail chains was seen as a vital part of the business models.


Table 1: Major City Statistical Divisions: Change in Population Density 1976-1996

Capital City Statistical Division Population Density Change

























Source: ABS Census of Population and Housing, 1976 and 1996 Censuses

Melbourne Population Density Graphs 

Melbourne population density graph 

Population density at June 2005 was highest in the city centers, particularly in the Sydney Statistical Division where the three most densely populated Statistical Local Areas (SLAs) in Australia were located. These were Sydney (C) - Central (8,400 people per sq km), Waverley (A) (6,600 people per sq km) and North Sydney (A) (5,800 people per sq km). Fourth on the list and Victoria's most densely populated SLA was Port Phillip (C) - St. Kilda (5,600 people per sq km). The SLA of New Farm in inner Brisbane (5,400 people per sq km) was Australia's fifth-most densely populated SLA. (ref ABS)

The following table shows the Population distribution of pets in Australia. Note that in 2005 several state values were combined however the table still shows an overall drop in pet numbers.

Australian Pet Ownership Statistics 2002 ('000) 

 Dogs  1,332  913  815  367  318  129  49  49  3,972
 Cats  769  616  436  256  228  95  29  38  2,466

 Australian Pet Ownership Statistics 2005 ('000)  

 Pet Type


 VIC  QLD  WA  SA / NT  TAS  ----  ----  TOTAL
 Dogs  1,219  894  819  338  373  111      3,754
 Cats  804  599  443  261  227  92      2,426


Pet Ownership costs

When defining the pricing of this product it is worthy to consider the cost of ownership of pets as well as the cost of substitute products and the ‘emotional cost’ of the pet if it is lost.

The average life-span of a dog and cat is around 12 years, with some dogs and cats living until 15 or more years of age. There are many costs involved with pet ownership. In addition to food, you must consider, vaccination, micro-chipping, de-sexing, general health care, vet bills, grooming, obedience training, boarding, bedding and proper housing. The costs may vary depending on the type of animal you choose - costs associated with dog ownership can be as much as $500 a year.

Adoption costs: To adopt a dog from a shelter can cost around $250 to $300 for a dog that is de-sexed, C5 vaccinated, heart-worm free and micro-chipped. 


Due to the ongoing confidentiality aspects of this project it may seem like this summary is an ad-hoc splicing of data. The reality is that even with full disclosure, many projects begin this way. Simple data sets are usually sought, refined and combined until they have a sufficient accuracy and meaning. Then business models are built around them, always balancing the desired growth level, resources availalbe and the risk level that a client is comfortable with.

There are many reasons that a company will engage someone such as myself to produce a report such as this. Besides keeping themselves at 'arm’s length' and concentrating on their R&D or other products in the company, consulting also guarantees them robust independent advice. In this case research and analysis was performed on secondary data on a market that the client has no expertise in. This second report created for this company has encouraged them to continue their development programs and assisted them in convincing their product has a viable market.