Acquisition captures market share, prompts plan for warehouse
NAPA — Lixit Corp., which has captured more than two-thirds of the U.S. market for small-pet watering devices, is preparing to reel in more dog accessories sales with the acquisition of a Chicago-area pet products company that patented a reel-based dog run, and a new Napa warehouse is planned to support Lixit’s double-digit annual growth.
Lixit (707-252-1622, lixit.com) acquired Howard Pet Products of St. Charles, Ill., on May 30. Operations were rolled into Lixit’s in Napa, and Howard Pickens, owner of the 2-year-old company, was hired as national sales manager.
“The products we acquired are helping to open difficult doors we couldn’t open before,” said Linda Parks, Lixit CEO.
Howard Pet had sales of around $1 million a year. The key product is a dog tie-out with a retractable leash akin to a fishing reel. It’s designed to replace chains, cables and other mechanisms for keeping a dog on a leash while allowing movement in a yard or a public setting such as a park. The reel can rotate 360 degrees on a stake that’s pounded into the ground. It comes in small, medium and large sizes and retails for $30–$40.
“The No. 1 customer that buys it is Camping World,” Ms. Parks said. “That gives us a heave-ho into the sporting-goods industry.”
Other key retailers that carry it include Ace Hardware, Tractor Supply, PetCo, PetSmart and Amazon.
The Howard Pet line of tie-outs, kennel-carriers with wild designs such as leopard spots and “vintage” leather footballs, soccer and other balls for dogs to chew on fit with Lixit’s dog products, Ms. Parks said.
Sales of dog products make up about 40 percent of U.S. sales of pet supplies, she said.
U.S. consumers spent $55.72 billion on their pets last year, up 4.5 percent from 2012, according to the 2013–2014 National Pet Owners Survey conducted by the American Pet Products Association. Estimated sales this year are $58.51 billion, which would be a 5.0 percent increase. Annual growth has been 3.5 percent–9.8 percent since 2001, and sales doubled in that time.
The third-largest category for pet spending, about $13 billion, is on supplies and over-the-counter medicine, following food at No. 1 and veterinary care at No. 2, according to the survey.
Pet ownership increased to 68 percent of U.S. homes in the most recent survey, up from 56 percent in 1988, the association said.
Lixit’s revenue growth is around 10 percent a year, reaching about $12 million a year now. Other products made and sold in Napa include pet houses, exercise equipment and care accessories. Lixit acquired horse show blanket maker Equitex of Petaluma in 2012.
The company employs 120 now and plans to hire 10 more in the next year. Lixit employs 30–40 disabled adults placed by local agencies and has done so since the 1980s.
“The business is growing by leaps and bounds, and we do not have the infrastructure to support that growth,” Ms. Parks said.
So the 46-year-old Napa company wants to build a 12,000-square-foot warehouse next spring next to its 50,000-square-foot headquarters factory at 100 Coombs St. The company currently leases an adjacent 10,000-square-foot warehouse. Initial designs and discussions with city officials is in progress, Ms. Parks said.
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