The business logic behind launching your own brand of cat litter

Hi, everyone! I’m Gavin from Petonly. Today, I want to discuss a serious topic — the business logic behind launching your own brand of cat litter. We have quite a few OEM customers, and I’ve been thinking about why they choose to create their own cat litter brand, especially tofu or cassava-based cat litter. Let me share my observations and thoughts with you.

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1. Brand Extension and One-Stop Service

Pet products aren’t just about food anymore. Pet owners care about health, care, and hygiene products as well. By offering your own brand of cat litter, you can diversify your product range and create a one-stop shopping experience for your customers. This makes it easier for customers to stick with your brand because they can trust you for more than just pet food. Plus, by expanding your product line, you can lower marketing costs since consumers already trust your brand.

2. Channel Resources and Supply Chain Synergy

If you’ve been in the pet food business for a while, you’ve probably built a strong sales network and a solid logistics and warehousing system. This makes it easier to promote new products like your own brand of cat litter. By using existing channels, you can significantly lower the costs and risks of launching a new product. Also, managing logistics and inventory under one roof helps you achieve scale, which brings down operational costs. On top of that, supply chain synergy helps ensure that every batch of cat litter meets high-quality standards, like being eco-friendly, low-dust, deodorizing, and antibacterial.

3. Higher Profit Margins and Targeted Marketing

With your own brand, you get to set the prices, which means higher profit margins compared to selling other brands. By managing everything from design and production to packaging and sales, you have more control over costs and quality, which boosts your overall profitability. Also, the customer base for pet food and cat litter is pretty similar. This gives you an opportunity to use data to target your marketing more effectively. For example, an American pet e-commerce site found that customers who bought both food and cat litter had a 62% higher retention rate than those buying just one category. They also reported that offering “food + cat litter subscription bundles” increased the average order value by 35%. This makes cat litter a great “retention tool,” “profit booster,” and “data pool,” which keeps customers loyal and strengthens your brand’s competitiveness.

4. Different Market Entry Paths and Their Logic

From talking with our clients, we’ve noticed a few different paths to entering the market:

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• Start with cat litter, then move to food: Some brands, like Kit Cat, started by focusing on cat litter. The idea here is that cat litter has high repeat purchase rates and good profit margins, which gives businesses steady cash flow and market validation. Once they’ve built a strong customer base with cat litter, they expand into food and other products.
• Start with food, then add cat litter: Some brands already have a solid presence in the food market and a loyal customer base. Once they’re established, they use that foundation to add cat litter to their offerings. This helps them grow their market share and profitability by cross-selling to existing customers.
• Supermarket chains or large retail stores start with cat litter when expanding into pet products: When large supermarkets or retail chains expand their product lines to include pet products, they often start with cat litter. Cat litter is a basic, essential product that people need for their cats, and it’s something that gets repurchased regularly. It’s a great way to bring in customers and then expand into other pet products.

By analyzing these different approaches, we see that:

• Cat litter is a basic, repeat-purchase product that can quickly build customer loyalty and act as a test for the market.
• Companies can choose to start with cat litter or expand into it later, depending on their existing resources and market positioning. Either way, it helps them grow their product range and increase sales.

5. Risk Management and Long-Term Strategy

Of course, starting a cat litter business comes with risks, like managing inventory, handling fierce competition, and maintaining product quality. To manage these risks, companies can strengthen their supply chain, set up efficient inventory management, and monitor product quality closely. Additionally, using data from your existing customer base for targeted marketing and subscription bundles can improve customer retention and reduce risks from depending on one product line. Over the long term, the pet market is growing, and getting into cat litter now helps position your brand for future growth and gives you a competitive edge.

Conclusion

For companies already in the pet food business, launching your own cat litter brand is more than just adding another product to your line. It’s a strategic move to integrate resources, enhance brand value, and grow your market presence. By offering brand extension, a one-stop service, supply chain synergies, and targeted marketing, you can meet customer demand, increase loyalty, and boost profits. While there are risks, with the right strategy and planning, launching your own cat litter brand can be a powerful driver for long-term growth and market success.

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