Wednesday, August 29, 2012

The pet shop operator's point of view

Yesterday, Aug 29, 2012, I phoned an old client cum pet shop owner as I reviewed his 2009 case records. He had sold off his share of consultancy business which included clientele like the Singapore Tourism Board. He had a pet shop which he now manages.
"How's business?" I asked. "Will you be interested in selling hermit crabs>"
"You've have the source?" he asked me.
"Yes, I have a supplier," I told him I was doing a survey.
"The AVA does not even allow me to sell a fish," he said.
"Why? Is your pet shop next door to a coffeeshop?"
"No, 3 shops away." he replied.
"That's strange," I said. "AVA allows pet shops to be opened elsewhere.
"I cannot sell any pets within 2 km of this food production factory," he enlightened me. "In case, disease goes to the food production factory." So, here, he wanted to increase his scope of services. The authorities put up 2km range to prohibit entrepreneurship.
"Business in pet shops in Jurong is very bad," he said the suppliers told him.
"Why? Is it because the public prefers to go to big operators where there is a diverse range of products and maybe cheaper?" I asked. This seems to be the trend. "This big operator (name given) kills all small operators. It does provide dog grooming too! People go for the cheapest prices."
So, there seems to be no hope for small pet shop operators as Landlords keep increasing the rentals. Singapore is just like Hong Kong. Only the Landlords and those tenants with deep pockets can benefit from intense competition. Kill all small operators in no time.

"What about the vet business?" he asked me.
"I am OK as I have been established over 40 years," I said. "That does not mean I will be OK in the near future as there are around 50 vet clinics being set up. If the management is poor or the standard of vet care is not up to excpectations or the Landlord closes me down, that is the end." I need to buy my own premises.

"There are many owners complaining about vets," the ex-management consultant said.
"What type of complaints?" I asked.
"Over-charging and being too young."
"Well, the vet costs to start up a clinic are very high as the younger vets with good financing installed all kinds of equipment and pay high rentals or buy the premises at over $2 million. Usually some have a business manager and several lay staff increasing overhead cost.  It is hard to price lower. May as well be an employee if the practise loses money on every case handled. Furthermore, new clinics have less clientele and therefore, the vet may need to charge higher. That gives the perception of over-charging. "

"imes will be rough for vets in private practice," I said. "Even some specialists leaving the government hospitals are not all having lots of patients."


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