Pet Spending at All Time High -- The American Pet Products Manufacturers Association Releases 2006 Pet Industry Spending Figures.

GREENWICH, Conn. -- New industry spending figures released by The American Pet Products Manufacturers Association (APPMA) confirm just how much pets are becoming a part of American families.

After tracking pet industry statistics for more than a decade, APPMA announced new figures today demonstrating a continued rise in pet expenditures. Pet spending has more than doubled from $17 billion in 1994 to an estimated $38.4 billion in 2006.

In 2006, Americans' spending on pets is projected to be higher than ever:

--$15.2 billion for food

--$9.3 billion for supplies and over-the-counter medications

--$9.4 billion for veterinarian care

--$1.8 billion for live animal purchases

--$2.7 billion for other services

Total pet spending in 2005 was more successful than projected with total sales coming in at $36.3 billion. And when examined by individual segment, the numbers are even more revealing. Both veterinary care and other services had stronger than anticipated performances in 2005. New and expanded veterinary services such as joint replacement surgeries, delicate eye procedures and senior health care helped increase total spending by almost 8 percent over 2004. Other innovative new services continue to increase market penetration with pet spas and hotels, grooming, pet therapy and related services.

"Both of these segments should maintain strong performances this year as pet ownership continues to increase especially among key demographic sectors including baby boomers and young professional couples," said Bob Vetere, president of APPMA.

Growth in the pet food sector performed as forecasted at 3.5 percent over 2004. "It is interesting to note that food continues to show growth not only in the expected high-end areas with vitamin fortified formulas, gourmet lines and natural/organic food but with the value-priced portion of the segment as well," said Vetere.

As with most retail areas, sales of pet supplies and O-T-C medications were impacted by an unusual number and intensity of storms last year like Hurricane Katrina and resulting record high gas prices. But, the late summer and fall slowdown in retail activity turned around with a strong Christmas selling season. Total sales within the pet supplies segment fell short of original projections but still showed a strong growth of 7 percent over 2004. "Based on year-end 2005 and early 2006 activity, we can anticipate almost the same growth this year," said Vetere.

Vetere points to a continued trend in the humanization of pet products to fuel further growth in retail. "Both baby boomers whose children have moved on with their lives and young professionals who are delaying having families in favor of careers are turning to pets to fill the void at home," he said. "With these families' higher-than-average disposable incomes, their pets are enjoying elaborate high-end and high-tech products as well as innovative devices designed for convenience for the pet owner." With this healthy base continuing to expand, APPMA is projecting total industry spending to grow by 5.7 percent in 2006 to a total of $38.4 billion dollars.

According to the APPMA 2005-2006 National Pet Owners Survey, current basic annual expenses for dog and cat owners in dollars include:

Dogs    Cats
        Surgical Vet Visits       574     337
        Food                      241     185
        Kennel/Boarding           202     119
        Routine Vet Visits        211     179
        Groomer/Grooming Aids     107     24
        Vitamins                  123     32
        Treats                    68      43
        Toys                      45      29

As it is becoming widely recognized, pet owners' spending is not limited to the basics. APPMA's National Pet Owners Survey shows 27 percent of dog owners and 13 percent of cat owners buy their pets birthday presents, and 55 percent of dog owners and 37 percent of cat owners buy their pet holiday presents.

Why do people pamper their pets to the tune of billions of dollars a year? Pet owners report in APPMA's National Pet Owners Survey it because they have a special bond with their pets and consider them a best friend, a companion or like a child or member of their family.

Vetere likens it to his experience with his golden lab, Dakota, "I can sit and talk to him and tell him any problem I have, and he just sits there with his tongue hanging out, smiling at me, just waiting for me to finish. It's like, 'OK, you feel better now? Let's go outside and play.' "

Pets not only make us feel better, all the pampering we've done for American pets has helped them reap the health benefits of human technological advances. A better understanding of pets by veterinarians and manufacturers is producing high-quality pet food, treats, treatments, health care items, vaccines, chemotherapy and surgical techniques that are extending the life of pets.

"We've come a long way in terms of how we view and treat our pets," said Vetere. "And, fortunately for pets and people, there is still plenty of opportunity for healthy growth."

The American Pet Products Manufacturer's Association (APPMA) is the leading not-for-profit trade association serving the interests of the pet products industry since 1958. APPMA membership includes nearly 900 pet product manufacturers, their representatives, importers and livestock suppliers representing both large corporations and growing business enterprises. APPMA's mission is to promote, develop and advance pet ownership and the pet product industry, and to provide the services necessary to help its members prosper.