Dog-eat-dog world eats up Pets USA

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Pets USA Inc., which has two stores in Colorado Springs, will no longer minister to the needs of our canine and feline friends. The small chain has been gobbled up by a rival and one of the largest specialty pet food and supplies chains in the nation.

PetCo Animal Supplies Inc., based in San Diego, has recently completed acquisition of Pets USA, which has four stores in Colorado.

The acquisition of the two Colorado Springs stores and two in the Denver area will bring the total number of stores PetCo operates to 325.

Jim Koskey, who started Pets USA along with Wes Howard in 1993, believes the acquisition is a very positive one for both companies.

"I think this will be a good move for everybody, particularly our customers," said Koskey. "Because of the numerous advancements we will be able to make, it will filter down to the customer to make the shopping experience a more enjoyable and cost-efficient one."

PetCo has also recently made its presence known in Canada. According to Brian Devine, CEO and president of PetCo, the size of the Pets USA stores proved to be an attractive ingredient in the acquisition, since PetCo’s outlets are uniformly spacious.

"The size and the location of these stores are excellent," said Devine. "The acquisition accelerates our growth in market share in Colorado."

Devine added the Pets USA stores are not the sole outlets where the PetCo masthead will be seen in Colorado. The company plans to add three stores in the state by the end of 1997, including at least one in Colorado Springs.

The stores in Colorado Springs have 35 employees, all of whom will stay on with the company, which will keep the Pets USA name until the end of the year. Koskey believes the changes will also be beneficial to employees, with more advancement opportunities available.

The needs of pets has become a entrepreneur’s dream in the last 20 years. Perhaps no one realizes this more than PetCo, which in 1965 was a start-up company with one store in the San Diego area. Devine said the consolidation of the pet supplies stores will likely continue, with his company being a major pursuer of opportunistic acquisitions.

With PetCo carrying more than 10,000 items in each store, premium foods, vitamins, toys, and other supplies can be found for fish, birds, and rabbits in addition to cats and dogs. Koskey predicts sales will increase dramatically with the new programs and products that will be available to the stores through PetCo.

PetCo also recently signed a merger agreement with Pet Food Warehouse, a chain with 28 stores in the upper Midwest, with annualized sales of $70 million.

PetCo’s 1995 revenue was $271 million, with 1996 sales projected to be $495 million. Looking ahead to 1997, PetCo projects record sales to be approximately $615 million.