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minimizing potential harm to the business during economic downturns. ... A business may also use diversification as a growth strategy. Drinks, pets, drinks, pets, drinks, pets … get the picture? Concentric diversification. Diversifying into markets or products that are related to its current business. Think of an automobile company adding a new model to its current sedan lineup, or expanding into the station-wagon market, or trucks and SUV’s. Drinks and pets may not go hand in hand, but the significance is not to be underestimated. In the cannabis sector recently, there have been two big announcements from Canopy Growth Corporation and CannTrust Holdings Inc. that have brought the pet market into the spotlight once again. Not to mention the amendment to Health Canada’s subsection 56(1) with respect to using hemp under the Industrial Hemp Regulations which will now enable companies with licenses to use the entire hemp plant for commercial purposes as of now and up until October 17th when legalisation happens (and it becomes legal to use the whole plant). The significance of utilizing the whole plant under the new regulation is that it will allow for the extraction of CBD from hemp. Meaning, we may see more and more companies diversifying, and one avenue for diversification is pets.
Back in February, I stressed the growth pattern in consumer spending on their pets. I know myself, having just gotten a puppy that economics go out the window when it comes to my dog. I spent literally over $500 just to get the little guy comfortable with his surroundings. A playpen, special flooring that can wipe off accidents pretty easily, a crate to sleep in, dog bed to rest in, toys, chews, a travel carrier, leash, collar, custom name tag, and treats for training. Just this week, he attended his first puppy class. $260 (cha-ching). First vet visit $180 (yikes).