Pet & Pet Supplies Stores NAICS 459910

Nov 25, 2025 - Petco to Close 25 Locations

• Pet supplies retailers face renewed pressure as Petco announced plans to close 25 underperforming US locations by the end of 2025, according to Penn Live. The closures, affecting a fraction of its approximately 1,300 stores nationwide, follow a year-over-year revenue decline in Q2, per the company’s earnings report. While Petco CEO Joel Anderson emphasized the move as part of a broader effort to strengthen its economic model, the decision underscores industry headwinds. Key challenges include intensifying competition, reduced consumer demand, labor shortages, inflation, and tariff impacts. For the wider pet supplies retail sector, Petco’s retrenchment signals potential consolidation, tighter margins, and heightened focus on operational efficiency. Smaller retailers may benefit from localized demand shifts, but overall, the industry must adapt to evolving consumer spending patterns and cost pressures. The closures highlight how even major chains are recalibrating strategies to stabilize earnings amid uncertain market conditions.
• The Retail Trade Industry is one of 11 industries reporting growth in October's Services ISM Report on Business. Executives in the Retail Trade industry reported increases in business activity, new orders, employment, prices paid for materials and services, and order backlogs, along with decreases in new export orders, imports, and inventories in October. Additional industries reporting growth during the period were Accommodation & Food Services; Wholesale Trade; Real Estate, Rental & Leasing; Health Care & Social Assistance; Utilities; Transportation & Warehousing; Agriculture, Forestry, Fishing & Hunting; Information; Professional, Scientific & Technical Services; and Educational Services. Six industries reported contraction during the period, including Arts, Entertainment & Recreation; Management of Companies & Support Services; Finance & Insurance; Public Administration; Construction; and Other Services. Overall, economic activity in the services sector expanded in October, with the Services PMI registering 52.4.

• According to Pet Age, the American Pet Products Association (APPA)’s 2025 Fish & Reptile Report reveals strong growth in pet ownership among Gen Z and Millennials, with 10 million US households owning freshwater fish, 6 million owning reptiles, and 2 million owning saltwater fish. Saltwater enthusiasts are upgrading: 44% now use 56–125 gallon tanks (up 10% from 2023), and 34% use tanks over 126 gallons (up 17%). Reptile trends show turtles/tortoises leading at 43%, while snake ownership rose 22% year-over-year. The report showed rising demand for high-end tanks, lighting (saltwater: 79% ownership, 58% planned purchases), and enrichment products. Specialty retailers gained traction, with reptile purchases from local stores up 15%, while superstore sales declined 14%. Gift spending also increased, with reptile owners averaging $34.20 per gift. These shifts signal opportunities through personalized products, habitat upgrades, and omnichannel engagement, especially as younger demographics deepen their investment in pet care.
• US consumer sentiment weakened in October and November 2025, putting pressure on pet and pet supplies retailers that rely on household discretionary spending. The University of Michigan’s Index of Consumer Sentiment fell 6.2% month-over-month to 50.3 in preliminary November data, nearly 30% below last year, while the Expectations Index dropped 36.3% annually to 49. Inflation expectations rose to 4.7% for the year ahead, and the Conference Board’s Consumer Confidence Index slipped to 94.6 in October, with short-term expectations down to 71.5 despite stronger current conditions. With more than half of consumers anticipating higher interest rates, households are likely to postpone or scale back big-ticket purchases such as appliances, televisions, and home electronics. For retailers, the environment points to slower sales growth, tighter inventory management, and heightened price sensitivity, underscoring the need for promotional strategies and financing options to sustain demand in a cautious consumer climate.