Petcetera has been a dog of a business for a while, according to its founder and CEO Dan Urbani, who told Business in Vancouver that he will go through a corporate restructuring for the second time.
"We have filed our notice of intention to seek bankruptcy protection," he told Business in Vancouver March 17.
"This will allow me to sell some inventory to raise cash and look at my options, which include closing stores. I could potentially downsize them or negotiate with landlords for better lease rates or there could be an opportunity for me to sell some stores. Some stores are performing very well."
Urbani was optimistic five years ago, when he went into bankruptcy protection the first time. He bought 18 of the then-45 stores from his former company for between $575,000 and $730,000 and believed that, because he was buying the most profitable locations, that he would be able to turn things around.
Instead, he had a tough slog.
Competitors had opened up near some of his locations. In other cases, because the stores were closed for several months, customers had got used to going elsewhere for their pet supplies.
Urbani noted that PetSmart has been his toughest competitor. That international giant has opened more than 100 stores in Canada and has been able to get locations far smaller than the ones that it leased more than a decade ago.
"PetSmart used to have prototypes of about 25,000-square-feet. They've dropped that box to around 12,000 square feet," Urbani said. "My stores average around 16,000 square feet but the reality is that they don't need to be that big."
Urbani was slow to get into online sales, which he ceased as of March 17.
Unlike ecommerce success stories such as Coastal Contacts, which mails higher priced goods that are lighter, Urbani found that mailing pet food and charging customers for shipping was simply not viable, he said.
Richmond-based Petcetera has more than 300 staff in six provinces and operates B.C. stores in Richmond, Coquitlam, Pitt Meadows, Abbotsford, Chilliwack, Kamloops, Penticton and Victoria.
Urbani, who is 49 years old, co-founded Petcetera with Danny Guillaume in 1997 and is a former Business in Vancouver 40 under 40 winner.
