What are Belgian pet retailer Tom&Co’s plans for the future?

Focusing on raising standards and accelerating development in both online and offline channels, leading Belgian pet retailer Tom&Co has adopted a strategy that involves pushing forward aggressively to enhance its offerings and services, ensuring that it not only meets but also exceeds market expectations.

Sven De Waele has worked in specialized retail for 20 years and co-founded webshop PharmaPets with his wife Valerie, who is a vet.

De Waele is currently wearing 2 hats – since Tom&Co acquired PharmaPets in June, he has remained CEO while also taking on the job of Chief Digital Officer for the pet store chain. In his new position, De Waele oversees everything related to the company’s e-commerce, digital initiatives and IT.

His responsibilities include omnichannel strategy management, which involves integrating all products, stores and future omnichannel features into the organization.

You are currently undergoing an omnichannel transformation at Tom&Co. What is your main priority?

The primary focus is on enhancing our e-commerce platform. Currently, Tom&Co’s online presence is minimal. We plan to migrate Tom&Co’s e-commerce operations to the PharmaPets platform.

Specifically, we will move Tom&Co’s warehousing to PharmaPets’ 7,500 sq m warehouse, which has been expanded by an additional 3,000 sq m this year.

We will also integrate the Tom&Co website into PharmaPets’ more advanced platform, which excels in areas like subscriptions and customer journey optimization.

What is the timeframe for that?

Our goal is to complete these projects by this November, allowing us to integrate online and offline experiences, so that online activities contribute to store visits and overall sales.

What’s your strategy when it comes to online sales?

With the integration of PharmaPets’ knowledge and expertise, we want to improve this balance. We aim to grow the online share of sales significantly. For the broader group, we expect online sales to represent about 15% of total sales this year.

Our long-term target is to increase online to 25-30%. But while online growth is important, it’s crucial that we continue to leverage the strengths of our physical stores, as they offer a competitive advantage over pure online players like Zooplus.

Is the online assortment going to be impacted in any way?

Currently, the Tom&Co online assortment is limited to what is available in stores.

Our new strategy will vastly expand this assortment, potentially offering 5 to 10 times more products compared to the in-store selection. We aim to include a wide variety of pet food brands to capture loyal customers who may not shop offline.

Will the new e-commerce platform be available across all markets where Tom&Co operates?

Yes, the new platform will be active in Belgium and France. The focus for Tom&Co will remain on these markets.

Unlike competitors like Maxi Zoo and Zooplus, who are shifting towards a marketplace model, our strategy will not follow that path.

Instead, we aim to build strong relationships with brands like Flamingo and Trixie, leveraging their full catalogs without needing to stock every product ourselves. This approach will help us maintain a broad assortment while ensuring efficient supply chain flows.

You’ve had some positive experience when it comes to subscription models…

At PharmaPets we started offering subscriptions last year and the response has been very positive.

In the Netherlands, over 60% of our sales now come from subscription customers, up from over 50% at the end of last year.

Belgium also shows strong results, with over 50% of sales from subscriptions.

France, where we launched in October last year, has also exceeded expectations, again with more than 50% of sales coming from subscriptions.

Will you be building on this successful customer loyalty strategy?

The success of these subscription models has been remarkable, and they have a significant impact on customer retention, as subscription customers are retained 4 times longer than non-subscribers. So, yes, we are exploring the potential of subscription options at Tom&Co.

What about category performance: which ones are the best and which are the most challenging?

Dog and cat food, which makes up over 50% of our sales, is growing at nearly double-digit rates.

Non-food categories, accessories for example, are facing more challenges. Sales of these items are showing slower growth than previous years, as some customers are buying smaller items or delaying purchases.

This shift could be caused by new competitors, such as Chinese players, who might be capturing a portion of the market.

How do you see the integration of services into your store network?

Until now, services have been designed primarily for points of sale (e.g. grooming salons, dog washing, insurance).

It’s time now to take them to the next level and to build a comprehensive ecosystem which will include, for instance, a mix of offline and online services, e-health and, potentially, in-store behavior consultations.

Which retailers are you taking as a model for this?

Pets at Home in the UK and Petlove in Brazil are great examples of how to integrate various services into a cohesive ecosystem. Pets at Home combines retail with in-store services, while Petlove started online before expanding into physical stores, vet software and insurance.

Chewy in the US also provides useful examples, with vet clinics and subscription models. Combining these elements – retail, vet services, e-health – could help us create a unique and competitive offering.

When it comes to expansion, are you mainly targeting the Flemish region?

Tom&Co has a stronger presence in Brussels and the French-speaking part of Belgium. We still have some gaps in the Flemish region, especially East and West Flanders. We plan to open 15-20 new stores over the next few years in those areas.

What’s your approach for new store openings?

While we initially focused on big cities, our strategy has evolved.

We are now looking to even open stores in cities where retailers like Maxi Zoo are located, provided the city is large enough. We’re no longer deterred by the presence of competitors if we still see opportunities to do business at that location.

Where do you want to be in the European pet retailing ecosystem?

Our goal is not necessarily to become the largest retailer in Europe – but to be the best. That means we are open to exploring new opportunities on a step-by-step basis.

Our investment partner, Verlinvest, has significant experience in the pet sector and can provide valuable insights when we are considering potential expansions. However, our current focus remains on optimizing and expanding within our existing markets.

Are you planning to expand to new markets in the future?

Our primary focus right now is to solidify our leadership position in Belgium and accelerate growth in France, a market that presents a significant opportunity for us due to its larger market size.

Today, we have 130 shops in Belgium as market leader. As France is six times bigger than Belgium, the market leader there could potentially have around 800-1,000 stores.

Maxi Zoo is the current leader with 300 stores, while we have 70. We would not expect to become the market leader in France, but be a strong challenger – growing to 200-300 stores in coming years.

You can find a 2024 overview of the Belgian pet industry, including the latest data and trends, here.