If asked to calculate in dollars just how much they love their dog or cat, most people would likely consider them priceless. Although the level of affection and companionship people feel for their pets can’t easily be quantified, the amount of money they spend each year on their furry friends can be.
According to the American Pet Products Association, an estimated $60 billion will be spent in 2015 on pet products in the United States, an all-time high. Thousands of companies and products are competing for a piece of this lucrative market, but only a few can truly call themselves leaders.
For 20 years, Fairport Harbor, Ohio-based manufacturer OurPets has claimed a position at the top of the industry when it comes to product innovation.
“In any industry, if you become a me-too type of company making commodity type products you’re just selling based on price unless you have huge brands, and we couldn’t survive in that mode because the retailers we’re selling to would then be our competition and just source these products themselves under their private labels,” says Vice President/General Manager Dean Tsengas, who started the company with his father, Dr. Steve Tsengas – its president and CEO – in 1995. “Our model is developing and presenting patented products that are very innovative that differentiate ourselves across various technologies in the pet industry.” The Tsengas family remains heavily involved in the company, which since 2001 has been publicly traded (OPCO).
The company offers 1,000 different SKUs and holds 175 patents on its pet products, which fall into three main categories: interactive dog and cat toys, feeding and storage systems, and waste management, particularly related to cats. Its products are available in pet specialty stores as well as food/drug and mass accounts globally.
At the time they founded the company, Dean and Dr. Steve Tsengas had years of experience in several different areas of manufacturing including blow molding, injection molding, rubber molding, powder coating, vacuum impregnation sealing and electronic assembly. The two were looking to diversify the family’s capabilities beyond supplying components to OEMs when they were approached about using their blow molding experience to make an elevated dog feeder.
“We’re very opportunistic and entrepreneurial,” Dean Tsengas says. “When the opportunity to make the dog feeder came, we initially didn’t think much of it and did not know much about the pet industry. But after we looked into the pet industry and saw how it was growing, we thought this might be an opportunity to get into an industry with a line of products with our own name and brand. We also researched the need for such a product and what else was out there, or specifically what was not out there.”
OurPets’ first product, the Big Dog Feeder, is a blow molded, elevated food and water diner designed to improve the posture and digestion of larger-breed dogs and minimize their joint and muscle stress. The feeder became an instant hit at dog shows and through catalogs – including Skymall – soon after its introduction.
OurPets today offers products ranging from innovative molded feeders to more sophisticated products including the Wonderbowl, a dog bowl that utilizes infrared technology to only open and close when within the range of a special pet tag. Several of its other products, including cat and dog toys, include sound chips and other technologies. The company also markets automatic cat litter boxes that utilizes a motorized rake to dispose of waste.
Much of the company’s product development is performed internally. Weekly meetings that include people from all departments are scheduled to develop products and manage projects from conception all the way to production and launching of product into the market.
OurPets’ product development efforts are aided by its supplier partners, which perform the majority of its manufacturing. “We try to form long-term relationships with partners, because they are very critical to our growth,” Tsengas says. “We believe they are just as important to our business as our customers, and that they are the lifeblood and extension of our company.”
Roughly 35 percent of the company’s products are manufactured domestically, a figure Tsengas hopes to improve. “We’re taking the initiative to re-shore production and bring as much of it to the United States as possible,” he adds.
‘The Right People’
The company in recent years has greatly enhanced its production and supply chain operations through its addition of enterprise resource planning and warehouse management systems. “Going from a single product to more than 1,000 has been very challenging from an operational standpoint, especially when it comes to warehousing and forecasting and replenishment,” Tsengas says. “Integrating our forecasting system with ERP and replenishment systems is critical in helping our sales and operations teams become much more in sync.”
Although these systems have greatly helped OurPets grow its business, Tsengas credits the people using them with the company’s success. “Our staff is the most important thing. Product innovation, teamwork and collaboration with our strategic supply partners are taking us to the next level,” he says.