As the owner of My Pet Warehouse and former CEO of Petbarn, Philip Bartholomew has great insights into what it takes to be a successful retailer and what the future of retailing looks like.
As a pet supplies retailer, there isn’t much that Philip Bartholomew hasn’t seen.
“Over the years we’ve had dogs, obviously; we’ve had pigs, donkeys, snakes, rabbits... we’ve had everything,” he says.
And those are just the visitors to his 12 stores. Then there are the products that line the shelves and warehouses that make up the company’s national distribution network.
“We sell pigs’ ears, and we sell pigs’ noses … we sell lamb lungs, lambs’ ears, lambs’ feet, chicken feet – you name an animal part and we sell it as a treat [for pets].”
As Philip points out, it is a fun environment in which to operate a business, and he is quick to note that people love shopping for their pets just as much as (if not more than) shopping for themselves.
Yet that doesn’t mean his journey as a retailer has been all fun and games.
“We went against convention in that we started a business we knew nothing about, with money we really didn’t have, and my wife was six months pregnant. So we had the recipe for failure, not success!” he says.
Yet Philip knew that his reasons for wanting to establish the business were solid, and so he persevered.
“I [was] living in Sydney in 2001, and one Saturday morning, I had actually been walking my dog [Ralph] in Centennial Park, and on the way home I thought to myself that I would go and get some pet food and some pigs’ ears for Ralph. And as I was driving from Centennial [Park] to Leichhardt to buy them, I went past a factory that my wife and I wanted to lease, but we couldn’t think of a business idea to put in there,” he recalls.
“And so it was like a light bulb moment or an epiphany or something, and just as I drove past the factory, I looked at Ralph and thought to myself, ‘Why am I driving all the way to Leichhardt from Alexandria or Centennial [Park] to buy pigs’ ears and pet food?’.”
Staring down the competition
As Philip admits, things went well initially, with the local community turning out in force to support the couple’s first pet business, The Pet Warehouse.
“Certainly there was a lot of community [spirit]; people would bake us cakes initially when we started and bring them into the store. So it was a lot of fun,” he says.
“One of our first customers was Ita Buttrose, who was living in our street at the time in Alexandria.”
However, it wasn’t long before a strong competitor threatened to bring everything crashing down around them.
“Six months after we opened in 2001, Petbarn opened up around the corner, and they only had a few stores then – I think 12 stores – and of course, being in my situation, I panicked,” says Philip.
“I thought I could either wither away and die or fight it, so I researched them and did all my homework and some more homework, and focused on our customers and obsessed about customer service. From the day they opened, our business actually went up 20 per cent, and about three or four months after they opened, we were actually trading about 40 per cent above where we were.”
Just six months on, Petbarn recognised the efforts Philip had put in, and proposed a tie-up between the two businesses. Initially he turned them down, but within months they approached him again to merge with his competitor and become Petbarn’s CEO – an offer he accepted.
So just how did Philip take on a much larger competitor and come out on top?
“When [customers] couldn’t find what they wanted [at Petbarn], we made sure they knew we were around the corner and they would come around and visit us,” he explains.
“In the early days, I remember even following customers out of the store and getting in my car and following them to see if they actually went into Petbarn, and see if they bought anything – I did it plenty of times. We even used to pay our customers’ parking fines if we had good customers [if incurred while they were in the store].
“The other trick we did was, if we were out of stock of something and I knew Petbarn would have it in stock, while the customer was in the store I would actually drive in my car, race around the corner and buy it, and bring it back without the customer knowing and sell it to them, just so they didn’t step into a Petbarn.”
“There is – as strange as it sounds – no such thing as online retailing; it’s just retailing.”
It is this unflinching focus on customer convenience that has remained at the very heart of Philip’s endeavours.
“While financial success is extremely important, my belief is that if you look after your customers, they will tend to look after you,” he says.
After roughly two years at the helm of Petbarn, Philip parted ways to again launch his own start-up – this time called My Pet Warehouse.
“I’m a bit more entrepreneurial ... my focus wasn’t necessarily building the biggest business; part of the fun was serving customers, and I focused on that.”
Part of the challenge in recent years has been the rise of online retailing. Yet for Philip, it’s not so much about deciding whether to be an online or a physical retailer, but how best to integrate both into a seamless customer experience.
“There is – as strange as it sounds – no such thing as online retailing; it’s just retailing,” he suggests.
“How you retail is what makes the difference. Whether you are retailing [partly] online or exclusively online, our thinking in pet supplies is that it’s completely seamless. So it’s a bit like a house renovation, and you’re not quite sure where the old house stops and the new house starts. With retailing, we attempt to blur the lines – not well, yet – but we blur the lines on where a physical store stops and an online store starts.
“If we don’t have something in stock, no problems – why don’t you pay for it now, and we’ll have it shipped to your house free of charge the minute it turns up? No more store transfers. I’m not sending someone to another store to risk losing a sale.”
He adds: “We aim to provide that seamless integration, at which point, is it the courier system you’re offering or is it online retailing you’re offering? [Effectively] it’s somewhere in the middle”.
Technology may change, but service remains the same
For Philip, the means of delivering products may be changing drastically thanks to technology, but the old principle that ‘the customer is always right’ remains iron-clad.
“For example … we used to sell frozen chicken necks, and one time a customer brought it all back and said, ‘I can’t feed this to my dog, there is a head attached to the neck’. And we didn’t have the heart to tell her, ‘Where do you think chicken necks come from? And the head is actually the more nutritious part of what you’re feeding your dog anyway’. We just gave her her money back and smiled!”
Business name: My Pet Warehouse
Location: Sydney stores and national online presence
Industry: Pet supplies
Employees: Over 100
Operating since: Mid 2009