Page 152 - 2020 White Paper on the Business Environment in China
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0 White Paper on the Business Environment in China
Market Regulation. Despite the improving quality medical services account for about 50 percent of the
of domestic products, public faith in domestically entire pet industry in the United States and only 20
produced baby formula has still not fully recovered. percent in China, the growth is far faster than the
Domestically produced baby formula only accounted US, as the US has maintained a 4 to 5 percent annual
for about 40 percent of the products sold in terms of growth rate in the last decade, In China, the pace of
weight in 2018 (Wang, Higher Standards). growth will be more than 15 percent (Ren).
Pets and Pet Products China’s growing pet economy saw sales of pet-
related products and services reached 172.2 billion
China’s urban pet (dog and cat) consumer market yuan in 2018. Consulting firm Frost & Sullivan China
surpassed the threshold of 200 billion yuan in 2019, said in a recent report that last year’s market size
with the overall consumption scale reaching 202.4 was three times that of 2013, and forecast it would
billion yuan, an increase of 18.5 percent over 2018. grow to 472.3 billion yuan by 2023. The pet cat
The consumer market for pet dogs in China will grow market segment, worth 60 billion yuan, is the second
17.8 percent from 2018 to 124.4 billion yuan in 2019, largest after the pet dog segment (98.5 billion yuan).
while the pet cat’s consumer market is expected to It is predicted to be the most vibrant one. Reasons
increase by 19.6 percent from 2018 to 78 billion abound as to why the cat economy is flourishing in
yuan in 2019. The number of pet dogs and cats is China. For one, pet cats are good stress-busters.
forecasted to reach 99.15 million in China by 2020, And in these hectic, stressful times in urban areas,
rising by 7.66 million from 2018(China Daily, Pet). they could prove very useful, experts said. According
to a report from Frost & Sullivan China, keeping cats
for pets costs a little less than maintaining dogs.
There were 91.5 million pet dogs and cats in China Cat-owners spend about 3,117 yuan per cat each
in 2018 and the market value of the pet industry year on average, while the corresponding number
reached US$24.84 billion. Some 47.1 percent of for a dog is 4,723 yuan. Much of a pet’s expenses
owners expressed frustration at the lack of medical are on food. For a cat, it is about 1,340 yuan, with
services for pets. The lack of regulation and industry medical care requiring 742 yuan on average. About
standards have led to problems due to the short 41 percent of the 99.8 million pet-keeping Chinese
history of the Chinese pet clinic business. People in households now have cats, and the number is
China didn’t really have pet dogs three decades ago, still growing. This has spawned a cat culture of
except foreign ambassadors and important figures; sorts, spanning a variety of business activities. For
ordinary people were not allowed to keep pet dogs. instance, specialist apps offer a service called “cloud
It only started in the 1980s when China was doing petting” for those who do not own a pet cat. The
business with the Soviet Union, and people started latter can follow “cat celebrities” on social media
to smuggle pet dogs into the country. It was a legally platforms. That’s just one form of making money in
gray area back then, but it did get the industry going. the cat economy. Many people are making products,
In the 2000s, the industry entered a development or offering services, that make cats’ lives fancier, and
phase, and people started to think about the medical their owners happier. An electric scalp massager
equipment and treatment market, but it was only in retails for about 120 yuan, and a FURminator (cat
the last 15 years when investment started to go into grooming comb) for over 100 yuan. Still, they are
the business. The market value of the pet industry just the tip of the cat economy iceberg. Medical care,
in China will reach 188.5 billion yuan in 2020 with theme parks, pet boarding services are expanding
an average annual growth rate of 30.9 percent from the sector. The Spring Festival holiday in February
2010 to 2020. Because people become more willing was a peak period for such services as more pet
to spend on their pets, the market is expanding to owners tended to make use of luxury pet hotels as
include not just clinics but also facilities and services ordinary boarding kennels were overbooked (Liu).
such as magnetic resonance imaging and beds for
worried owners so they can stay overnight with Finally, pet funeral services are picking up steam
their pets. As the market for professional pet care in China, as millions of animal lovers seek ways to
matures, the demand for machinery and medical bring closure to their relationships with their former
equipment grows too, which is good news for companions. The number of pet owners in Chinese
manufacturers of medical equipment. Although
152
Market Regulation. Despite the improving quality medical services account for about 50 percent of the
of domestic products, public faith in domestically entire pet industry in the United States and only 20
produced baby formula has still not fully recovered. percent in China, the growth is far faster than the
Domestically produced baby formula only accounted US, as the US has maintained a 4 to 5 percent annual
for about 40 percent of the products sold in terms of growth rate in the last decade, In China, the pace of
weight in 2018 (Wang, Higher Standards). growth will be more than 15 percent (Ren).
Pets and Pet Products China’s growing pet economy saw sales of pet-
related products and services reached 172.2 billion
China’s urban pet (dog and cat) consumer market yuan in 2018. Consulting firm Frost & Sullivan China
surpassed the threshold of 200 billion yuan in 2019, said in a recent report that last year’s market size
with the overall consumption scale reaching 202.4 was three times that of 2013, and forecast it would
billion yuan, an increase of 18.5 percent over 2018. grow to 472.3 billion yuan by 2023. The pet cat
The consumer market for pet dogs in China will grow market segment, worth 60 billion yuan, is the second
17.8 percent from 2018 to 124.4 billion yuan in 2019, largest after the pet dog segment (98.5 billion yuan).
while the pet cat’s consumer market is expected to It is predicted to be the most vibrant one. Reasons
increase by 19.6 percent from 2018 to 78 billion abound as to why the cat economy is flourishing in
yuan in 2019. The number of pet dogs and cats is China. For one, pet cats are good stress-busters.
forecasted to reach 99.15 million in China by 2020, And in these hectic, stressful times in urban areas,
rising by 7.66 million from 2018(China Daily, Pet). they could prove very useful, experts said. According
to a report from Frost & Sullivan China, keeping cats
for pets costs a little less than maintaining dogs.
There were 91.5 million pet dogs and cats in China Cat-owners spend about 3,117 yuan per cat each
in 2018 and the market value of the pet industry year on average, while the corresponding number
reached US$24.84 billion. Some 47.1 percent of for a dog is 4,723 yuan. Much of a pet’s expenses
owners expressed frustration at the lack of medical are on food. For a cat, it is about 1,340 yuan, with
services for pets. The lack of regulation and industry medical care requiring 742 yuan on average. About
standards have led to problems due to the short 41 percent of the 99.8 million pet-keeping Chinese
history of the Chinese pet clinic business. People in households now have cats, and the number is
China didn’t really have pet dogs three decades ago, still growing. This has spawned a cat culture of
except foreign ambassadors and important figures; sorts, spanning a variety of business activities. For
ordinary people were not allowed to keep pet dogs. instance, specialist apps offer a service called “cloud
It only started in the 1980s when China was doing petting” for those who do not own a pet cat. The
business with the Soviet Union, and people started latter can follow “cat celebrities” on social media
to smuggle pet dogs into the country. It was a legally platforms. That’s just one form of making money in
gray area back then, but it did get the industry going. the cat economy. Many people are making products,
In the 2000s, the industry entered a development or offering services, that make cats’ lives fancier, and
phase, and people started to think about the medical their owners happier. An electric scalp massager
equipment and treatment market, but it was only in retails for about 120 yuan, and a FURminator (cat
the last 15 years when investment started to go into grooming comb) for over 100 yuan. Still, they are
the business. The market value of the pet industry just the tip of the cat economy iceberg. Medical care,
in China will reach 188.5 billion yuan in 2020 with theme parks, pet boarding services are expanding
an average annual growth rate of 30.9 percent from the sector. The Spring Festival holiday in February
2010 to 2020. Because people become more willing was a peak period for such services as more pet
to spend on their pets, the market is expanding to owners tended to make use of luxury pet hotels as
include not just clinics but also facilities and services ordinary boarding kennels were overbooked (Liu).
such as magnetic resonance imaging and beds for
worried owners so they can stay overnight with Finally, pet funeral services are picking up steam
their pets. As the market for professional pet care in China, as millions of animal lovers seek ways to
matures, the demand for machinery and medical bring closure to their relationships with their former
equipment grows too, which is good news for companions. The number of pet owners in Chinese
manufacturers of medical equipment. Although
152
