Chewy is a retailer that sells thousands of pet-related items both online as well as through a multitude of retail locations.
The company, which is headquartered in Boston, Massachusetts, was founded in 2011 by Michael Day and Ryan Cohen.
Chewy serves all types of pet owners including dogs, cats, fishes, reptiles, birds, horses, and even the pet parents themselves.
As a result, it offers almost any product imaginable. Customers can purchase food and treats, medication, toys, litter, beds, accessories, and more.
Chewy boasts an inventory of 100,000 different products and works together with over 3,000 brands including Nutro, Royal Canin, and Greenies. It has even developed its own brands such as frisco.
During the Covid pandemic, Chewy also unveiled a virtual service that allows pet owners to connect with licensed veterinarians.
Chewy was eventually sold to PetSmart for $3.35 billion in cash in April 2017. The acquisition, at the time, became the largest sale of an e-commerce company.
And even though Cohen, who is considered the brains behind the operation, stepped down a year after the acquisition, Chewy continues to dominate online pet product sales.
The firm ultimately went public in June 2019 at a valuation of $8.8 billion, allowing it to raise $1 billion. Previously, investors had poured $451 million into Chewy.
And a year after, in October 2020, Chewy was spun out of PetSmart. The two firms had previously failed to properly integrate and BC Partners, the owner of PetSmart, felt that they would be more valuable on their own.
Today, Chewy generates $8.89 billion in revenue on an annual basis but remains unprofitable. Additionally, it employs over 20,000 people across its corporate offices as well as customer service and fulfillment centers.
The methodology with which competitors of Chewy are ranked is based on publicly available data. Information such as revenue, the number of customers, valuation, products available, and anything else in between will be considered.
Chewy is solely available in the United States. As such, only competitors from the U.S. will therefore be taken into account.
We will, furthermore, exclude sites that are primarily known for producing pet-related content. Examples include Rover, The Dodo, or Pet Keen. Lastly, the brands themselves (e.g., Royal Canin) will not be considered as well since they mostly work together with online and offline retailers.
It has to be noted that this analysis should not be seen as an endorsement of either service. It is merely an objective summary of the competition that Chewy faces as of today.
So, without further ado, let’s take a closer look at the top 7 competitors of Chewy.
Headquarters: San Diego, California Founder(s): Nick Braun Year Founded: 1965
Petco is likely the largest pet retailer in the United States. It operates 1,500 retail locations in the U.S., Mexico, as well as Puerto Rico. On top of that, it runs more than 100 in-store veterinary hospitals.
The firm, apart from pet supplies and medications, provides a variety of additional services. These entail in-store dog grooming and training services, a company-branded debit card, a monthly wellness plan, pet insurance, automated deliveries, and plenty more.
Petco’s extensive retail network, furthermore, allows it to offer same-day shipments. Chewy deliveries normally take between two to five days since the products are shipped from strategically located fulfillment centers.
Over 24 million active customers are currently using one of Petco’s services. In 2022, the firm generated around $6.15 billion in revenue while posting a profit of over $190 million. Over 27,000 people are employed by Petco right now.
Petco itself is currently owned by private equity firm CVC Capital Partners, which paid $4.6 billion to acquire the company back in March 2016. They even retained their ownership stake when Petco IPO’d for the third time back in January 2021, raising $864 million in the process.
Source: Petco, Retail Dive
Headquarters: Phoenix, Arizona Founder(s): Don Spear, Ford Smith, Jim Dougherty Year Founded: 1986
PetSmart, as previously stated, had bought Chewy back in 2017 but ultimately separated from the company three years later. Prior, PetSmart used proceeds from Chewy’s 2019 IPO to pay down portions of its own debt, which caused all kinds of problems. PetSmart effectively tried to move Chewy shares out of the lenders’ reach in case it wouldn’t be able to pay down debt.
Nevertheless, PetSmart remains one of the biggest retailers in North America. It owns and operates 1,650 pet stores in the United States, Canada, and Puerto Rico. On top of that, it runs 200 in-store PetsHotel dog and cat boarding facilities.
PetSmart, apart from selling nearly every imaginable pet product, also offers dog training, pet grooming, pet boarding, day camps for dogs, and even facilitates adoptions. In fact, over 10 million adoptions have been enabled through its stores.
The 11,000+ products are managed by the 55,000 people that PetSmart presently employs. The firm itself is owned by private equity firm BC Partners, which paid $8.7 billion to acquire PetSmart back in 2014 – the largest private equity acquisition at the time.
However, the BC Partners tenure hasn’t always been smooth sailing. Advocacy groups accused the private equity investor of slashing costs to the point that it negatively affects the treatment of both animals and workers.
Source: Bloomberg, Forbes, PetSmart
Headquarters: Seattle, Washington Founder(s): Jeff Bezos Year Founded: 1994
Amazon, being the world’s biggest e-commerce marketplace and one of its most valuable firms, certainly doesn’t need any introduction. Even more so, co-founder Ryan Cohen often cited Jeff Bezos as his main inspiration for how he grew Chewy.
For example, Chewy, much like Amazon, obsesses about the customers, which is exemplified by the thousands of people that work in its customer care centers alone. And he used Amazon’s lack of focus as a way to provide a differentiated customer experience based on a heartfelt brand.
However, Amazon has since begun to catch up. First of all, it offers tens of thousands of different pet products from leading brands such as Cesar or Greenies. Many of those brands are also directly selling on Amazon. Prime members, as with many other product categories, can take advantage of free and same-day deliveries as well as automatic refills.
On top of that, Amazon has launched its own private-label brands as well. In May 2018, for example, it unveiled Wag, a dog food brand. And Amazon’s advantage is that it can often price those products comparatively cheaper since it doesn’t have to pay a marketplace fee.
In May 2022, in celebration of National Pet Month, the firm unveiled the Amazon Pet Day. This 24-hour event granted customers access to hefty discounts in a variety of pet-related categories.
Amazon is expected to further its advances in the pet category, with industry experts speculating that new private label brands, as well as other, related services, may soon be unveiled.
Source: Bloomberg, Forbes, RetailWire
Headquarters: Bentonville, Arkansas Founder(s): Sam Walton Year Founded: 1962
Walmart is the other company on this list that certainly needs no introduction. The firm, which is active in 24 countries, is the largest private-sector employer in the United States, boasting over 2.3 million employees.
Over 10,500 Walmart stores are currently being run across the globe. In the U.S., a Walmart store is within a 10-mile radius for 90 percent of all Americans. The firm, in an effort to compete with the likes of Amazon, has also invested heavily into digital.
For example, its Walmart+ subscription is supposed to rival Amazon’s Prime offering by providing users with various discounts and access to exclusive deals. Walmart has, furthermore, launched initiatives such as curbside pickup or mobile scan and go. For reference, its namesake Walmart.com website is visited 100 million times per month.
However, Walmart’s efforts in the pet category pose a serious threat to Chewy as well. In November 2020, for example, it unveiled a new pet care service that brought together existing offerings such as Walmart’s pet insurance as well as dog walking and pet sitting, among many others.
Six months later, it debuted a new cat and dog food brand dubbed Pure Balance Pro+. Previously Walmart had introduced other native brands such as Ol’ Roy (for dogs) and Special Kitty.
Walmart, apart from food and other utensils such as beds, also offers pet medication via Walmart Pet Rx. Those meds are made available both online as well as through Walmart’s 5,000+ pharmacies in the United States.
Source: Store Brands, Walmart
Headquarters: Pompano Beach, Florida Founder(s): Marc Puleo Year Founded: 1996
PetMeds claims to be America’s most trusted pet pharmacy, totaling 11 million customers across all states. The firm, for instance, possesses an online veterinary pharmacy verification handed out by the National Association of Boards of Pharmacy.
Apart from distributing pet medication, PetMeds also connects pet owners with veterinarians through a chat. PetMeds, furthermore, creates content around various health conditions and treatments and, much like Amazon or Chewy, offers an option to have prescriptions shipped automatically.
Founder Puleo, a former anesthesiologist, launched the business as a mail-order service for both animal and human prescriptions. However, he quickly shifted to pet supplies only due to the intense competition in the human subscription market.
Four years later, PetMeds went public on the Nasdaq stock exchange. Today, it generates $273 million in revenue on an annual basis. Over two million unique customers and 70,000+ veterinarians and clinics are registered on the platform.
Headquarters: Minneapolis, Minnesota Founder(s): George Dayton, Doug Dayton, John Geisse Year Founded: 1902
Target, with $109 billion in annual revenue, remains one of the biggest retailers in the United States and beyond. It has, furthermore, been one of the first retailers of that size to sell online. Its namesake Target.com website was launched back in 1999.
Today, it runs over 1,900 stores in the United States. This means that 75 percent of all people in the country live within a 10-mile radius of a Target store. The firm sells all kinds of food and general merchandise, which obviously includes pet products as well.
Target currently sells over 7,000 different products aimed at dogs, cats, rabbits, birds, and fish. In 2011, it also launched its own brand dubbed Boots & Barkley which includes pet beds, bowls, collars, leashes, and toys. Ten years later, Target launched a pet food brand (Kindfull) as well.
While Target may not be specialized in pet-related products, it makes up for the lack of focus by offering other benefits such as same-day deliveries, in-store pickups, or the ability to earn loyalty points for any purchase.
7. Pet Supplies Plus
Headquarters: Livonia, Michigan Founder(s): Harry Shallop, Jack Berry Year Founded: 1988
Pet Supplies Plus is another physical retailer that has used its popularity to serve customers online. It offers many of the same products Chewy has in store. On top of that, customers can arrange curbside pickups or have products delivered from stores in proximity.
Additionally, Pet Supplies Plus offers a premium subscription service dubbed Autoship, which gives customers access to a variety of discounts and exclusive deals. The firm, furthermore, offers pet grooming and washing services as well as medical procedures such as microchipping or vaccinations.
Pet Supplies Plus, throughout its 30+ year history, has also gone through various ownership changes. The firm is currently owned by the Franchise Group, which paid $700 million in January 2021.
In 2021, the firm allegedly generated $1.2 billion in revenue for the year. It owns and operates around 560 retail locations while employing over 3,000 people on a full-time basis.
Source: Pet Food Processing,Pet Supplies Plus