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Article - December 14, 2022

Pet Food: Voff Showcases the Power of a Multidimensional Platform

Key Learnings 

  • Due to steady demand drivers and innovation, pet food combines resiliency and growth. 

  • Pet food companies can create value through differentiated products across formats, categories, channels, and markets. 

  • Voff, a recent Harris Williams client, highlights how a strong platform can generate continued organic and M&A growth. 

Driven by non-discretionary demand and innovation across the space, pet food is a $136 billion industry that’s expected to grow by 10% annually through 2027.*

Here, senior bankers from the Harris Williams Consumer Group share why pet food and treats continue to attract investors, how Voff Premium Pet Food became an industry leader, and what key traits to look for in other winning companies.

Featured Professionals:

Will Bain, Managing Director, Consumer Group
Ryan Budlong, Managing Director, Consumer Group
Daniel Wang, Managing Director, Consumer Group
Konstantin Molinari, Vice President, Consumer Group

Reliable Demand, Growth Through Innovation

Even during periods of economic uncertainty, pet-loving consumers must feed their pets and often maintain their preference for top-notch food, treats, and supplements. Pet owners also tend to prioritize high-quality food and treats over other pet-related products, causing premium pet food and treat brands to be less affected by changes in disposable income. Meanwhile, pet ownership and lifespans are up, and trends such as the humanization of pets and premiumization of pet products remain strong. Together, these factors have established reliable demand and downside protection across the pet food and treat sectors.

With steady demand in place, pet food and treat brands can create value across multiple dimensions. “There’s a diverse array of opportunities to grow through different formats, categories, channels, and markets, both organically and through M&A,” notes Bain.

Innovation is a powerful driver of the sector and the growth opportunities within it. “New, interesting pet food and treat formats that capitalize on consumer trends are entering the market, capturing demand, and quickly taking share,” explains Budlong. “Retailers are drawn to these products because of their ability to generate increased rates of sale and higher cash margins,” he adds.

Raw and other minimally processed products, in particular, are expanding more rapidly than the broader pet food market. “These innovative and high-quality categories, further fueled by their complementary range of treats and supplements, continue to grow strongly with large white space to target,” says Bain.

Voff: Diverse Products With Expansive Coverage

Voff Premium Pet Food, a recent Harris Williams client, is a leading European platform in the premium natural pet food segment with a number of strong brands across Germany, the U.K., and Scandinavia.

Through a strong portfolio effect and multiple proven growth levers, Voff has built an attractive platform. “It has become a top performer in the space thanks to a wide range of innovative pet food products, and expansive coverage across key pet categories, formats, channels, and markets,” says Bain.

The company’s share by format is a key differentiator, featuring a holistic offering of trending and highly complementary product types such as raw food, treats, and supplements. And due to its scalable infrastructure, Voff has established end-to-end in-house production capabilities and complete ownership of the process from raw ingredient sourcing to packaging.

In addition, Voff offers these products across multiple markets through an efficient and cost-effective multichannel approach that’s broadly balanced between B2B and DTC. “Especially in the current economic environment, this multichannel strategy is a standout trait that allows for better management of cost inflation and related price optimization,” notes Budlong. “Voff’s DTC KPIs were incredibly strong, both on the customer acquisition and customer lifetime value sides of the equation. These strong, sustainable metrics helped underpin an exciting growth story in their DTC channel.”

On the B2B side, Voff mainly targets smaller shops in the specialty pet food retail space, where its on-shelf efficiency and premium quality help it to successfully manage price discussions. Meanwhile, in DTC, it can adjust prices as needed across its own websites, while targeting a more affluent and selective demographic that desires more premium products.

Another key to Voff’s success is its multi-market presence across three major European markets. “This broad and proven geographic reach provides larger white space for continued growth, while diversifying the company’s risk by market, brand, format, and customer,” explains Molinari.

These factors have contributed to the strength of Voff’s platform, which is fundamental to its organic and M&A growth. “The brand has established a proven M&A strategy that has played a pivotal role in its success, targeting a tangible pipeline of smaller companies in a highly fragmented landscape,” says Bain. “Due to lower competition for these businesses, Voff can acquire complementary brands across product categories, markets, and channels, while delivering both cost and revenue synergies,” he adds.

Hungry for Consolidation and Professionalization

When considering high-value pet food and treat opportunities, companies with innovative products, differentiated brand propositions, and unique consumer experiences will continue to win. “For instance, businesses can utilize advanced tech capabilities to track each pet’s breed, age, and medical conditions to serve a tailored and higher quality digital experience,” points out Wang.

There are also expanding opportunities to build more holistic offerings that address all of a pet’s needs, from products to healthcare. Bain explains that this approach can further drive higher-value ways to engage with a customer and increase their lifetime value, creating a stickier relationship and more opportunities for add-on services.

Lastly, plenty of white space and under-the-radar investment opportunities exist within the more niche pet food and treat categories, such as the plant-based and minimally processed markets. “These highly fragmented landscapes of businesses are primed for consolidation,” says Budlong.

A Sector Full of Opportunities

Driven by steady demand and innovation, the pet food and treat sectors combine resiliency through economic cycles and opportunities for long-term growth.

The companies best positioned to win will capitalize on pet food and treat premiumization trends with holistic offerings of differentiated products that can be delivered across a range of channels and markets.

To learn more, please contact our senior bankers.

https://www.statista.com/outlook/cmo/food/pet-food/worldwide

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Contacts

Harris-Williams Bio-Crop 0028 WillBain 1

Will Bain

Managing Director

Harris-Williams Bio-Crop 0049 budlong ryan-2

Ryan Budlong

Group Head
Managing Director

Harris-Williams Bio-Crop dwang 1

Daniel Wang

Head of Asia-Pacific & Sovereign Wealth Funds
Managing Director

Harris-Williams Bio-Crop 0008 KonstantinMolinari

Konstantin Molinari

Director

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Harris Williams is a global investment bank specializing in M&A and private capital advisory services. Clients worldwide rely on us to help unlock value in their business and turn ambitious goals into reality. We approach every engagement with boundless collaboration, pooling expertise and relationships across industries and geographies. For over 30 years, our clients have trusted us to think strategically, execute precisely, and deliver superior outcomes to help them grow.


Harris Williams LLC is a registered broker-dealer and member of FINRA and SIPC. Harris Williams & Co. Ltd is a private limited company incorporated under English law with its registered office at 13th floor, One Angel Court, London EC2R 7HJ, UK, registered with the Registrar of Companies for England and Wales (registration number 07078852). Harris Williams & Co. Ltd is authorised and regulated by the Financial Conduct Authority, number 5408952. Harris Williams Private Capital Advisory Ltd. is an Appointed Representative of Sturgeon Ventures, LLP, which is authorised and regulated by the Financial Conduct Authority number 452811. Harris Williams & Co. Corporate Finance Advisors GmbH is registered in the commercial register of the local court of Frankfurt am Main, Germany, under HRB 107540. The registered address is 16th Floor, Marienturm, Taunusanlage 9-10 60329, Frankfurt am Main, Germany (email address: hwgermany@harriswilliams.com). Geschäftsführer/Director: Paul Poggi, VAT No. DE321666994. Harris Williams is a trade name under which Harris Williams LLC, Harris Williams & Co. Ltd and Harris Williams & Co. Corporate Finance Advisors GmbH conduct business.