sinesses, and that the acquisition will only serve to strengthen its loyalty program and customer offer – as well as add a physical component to its own pet business. “We’ll continue to support [PetStock’s] growth through access to our own retail capabilities in areas such as digital media, e-commerce, supply chain and retail operations,” Banducci said.  “Greencross and Pet Barn are very strong competitors, and we can see where the performance gaps are for PetStock – so that gives us a really good foundation on what can be done. “There’s a lot of lessons we can apply to [PetStock] together with our partners, and so our hope is to help them to execute on the opportunities they have.” According to Banducci, the key areas that are ripe for improvement are PetStock’s supply chain, its omnichannel and e-commerce operations, and its customer data. Petspiration’s brands, including PetStock, Caribou and Glow, will be operated independently from Woolworths. Covering all bases The acquisition will help Woolworths further  tighten its grip on areas of non-discretionary spending at a time where many people are looking to cut back. “We’ve been asked if pet ownership was at its peak during lockdowns – everyone had a pet then – but it isn’t trending downward in any Western country,” Banducci said.  “Pets are living longer, their nutrition is better, and their exercise is better. There’s a number of trends there which will [contribute to growth].” Queensland University of Technology’s Professor Gary Mortimer told Inside Retail that the deep push into everyday categories such as pet goods, insurance, alcohol and food is a way for Woolworths to keep steady, consistent and sustained growth across the board. “Areas of retail such as fashion, footwear, jewellery, can ebb and flow based on the economic conditions of the day,” Mortimer said. “They’ve really made a smart, strategic alignment of brands [they’ve invested into].” Analysts, however, were less convinced. Sean Cousins from UBS asked Banducci whether the recent spate of acquisitions, from MyDeal and PFD to Petspiration, were going to create meaningful returns for shareholders or if they were a way for Woolworths to recreate itself as a retail conglomerate.  Banducci pushed back, stating that the amount it had invested was dwarfed by the amount it raised during the demerger from Endeavour Group. “The difference between the two types of acquisitions we’ve been making is that we either back the founders, believe in their vision and back the brand… or we see they can strengthen the capabilities of our existing business,” Banducci said. “None of them are designed to distract from our very strong food retailing business.” Headwinds That’s not to say that Petspiration will be a sure-fire success. The pet sector, like all parts of retail, is likely to face difficulties into the new year, though maybe at a different rate than others.  “Traditionally the pet sector has been recession proof,” Mike Halligan, co-founder of Scratch dog food told Inside Retail.  “[But] what’s interesting about this moment in time is that most of the innovation has been in the premium end of the market, as private labels and new startups like Scratch try to improve on a stagnant industry and capitalise on the humanisation of pets. “Cost-of-living increases are hitting pet food hard, with most raw ingredients having gone up by over 20 per cent this year – which puts pressure on the premium end, which uses animal protein sources that will be hit harder than lower-cost meals.” Halligan said he also expects to see empty shelves across the pet food sector at different points next year, as different manufacturers struggle with the price of raw materials and supply chain challenges continue impacting food deliveries.