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Sales of aquatics products and livestock have leveled off somewhat following exceptionally strong growth through the first part of 2021, though most retailers report that newer customers have turned into returning customers. Interest in the hobby has fueled demand for fish dietary products, along with the expertise that independent fish retailers offer.

Seasonal forces impacted the aquatics business in the spring through summer months, retailers reported.

“I got a huge boost from COVID,” said Anthony Vyeda, co-owner of California Reef Co., an aquarium shop in Newark, Calif. “Last year was probably the busiest year I’ve had since I’ve been open. This year, business slowed down like normal for the spring, but summer was dead. Last July was the worst month I’ve ever had. But summer is always slow, and combined with COVID winding down, and people being able to go on vacation this year, it’s understandable. Once the weather starts to cool down and kids go back to school, it gets really busy again.”

Most retailers report that they have reached a higher plateau in sales overall, with fish food sales remaining strong.

“We saw a lot of growth in sales last year,” said Annalise Roy, manager for Waterbury Aquarium, a tropical fish store in Waterbury, Conn. “We had a really good, record year. Right now, sales are remaining steady. During the summer heading into the back-to-school months, business tends to be slow, but we’re still pretty steady overall.”

For many retailers, it is not the case that sales are dropping, but instead are returning to more normal levels, stores report.

“Business has definitely been strong,” said Greg Housley, owner of Optimum Aquarium, a tropical fish store in Kennesaw, Ga. “Overall, the booming sales trend was more of a 2020 thing. I’m starting to see things level out to a more normal pace. At least for us, that jump we saw last year has plateaued to a new, higher norm in terms of sales. Fish food sales are relative to the amount of business overall. We’re selling less fish food now than we were in 2020. … We’re back to a more normal, average level than the crazy sales we saw last year.”

Part of the sustainability that retailers associate with fish food sales has depended on independents’ status as authorities in the hobby, especially for the newer aquarists who became customers in the last year to six months.

“A lot of our customers take our advice and have healthy, happy fish,” Roy said. “Most of our customers are coming in for specialty food items. … We’re the only source for a lot of this stuff. We have a lot of customers that are looking for that [expertise].”

Fish food sales have also benefited because product is readily available and retailers have experienced relatively few issues with restocking and shipping aquatic dietary products.

“Overall, availability hasn’t been as big an issue,” Roy said. “It’s rather steady right now. In 2020, we had a number of shipping issues with different foods. Recently, we had some issues getting frozen bloodworms in. But that’s all settled. It just took a couple weeks to be resolved.”

Specific foods are occasionally harder to find, but the segment as a whole is healthy, relative to other categories.

“We haven’t had problems with shipping [fish foods],” Vyeda said. “There has been a lot of stuff that just isn’t available, but currently we haven’t had a lot of supply issues. It was more a problem at the beginning of the pandemic.”

Fish food manufacturers are aware of the problem and continue working to alleviate supply issues.

“The pandemic created a huge disruption of the supply chain,” said Chris Clevers, president of Hikari Sales USA, a supplier of specialty fish foods in Hayward, Calif. “The major issue is the worldwide supply chain. At Hikari Sales USA Inc., since the start of the pandemic, we have taken the approach that business would increase due to people being at home and spending more time with their pets, and not just fish. Fortunately, we were right and the additional inventory we built in to our system has allowed us to keep our retail partners in stock.”

The rush to meet demand meant manufacturers have focused on fulfilling existing orders, industry insiders said, though both retailers and manufacturers are having success growing business and overcoming supply constraints.

“During the pandemic, the business of producing and successfully delivering frozen foods to retailers and distributors has been a roller coaster,” said Larry Dupont, owner and founder of LRS Foods, a fish food supplier based in Advance, N.C. “Reduced business hours for pet stores, increased online shopping clogging up the mainstream shipping networks, and sourcing of ingredients were all pitfalls we had to navigate. When you factor in the stimulus money and everyone trapped at home, 2020 saw our sales revenue jump 150 to 200 percent during the pandemic. Many of our retail partners experienced the same flood of customers and foot traffic.”

Consumer Education

Nutrition and Quality

Independent aquatics retailers have a strong market position in the nutrition category, retailers reported.

“Our customers are definitely focused on nutrition, especially if they are into saltwater,” said Annalise Roy, manager for Waterbury Aquarium, a tropical fish store in Waterbury, Conn. “Customers are more focused on nutrition in that part of the hobby, because the fish are more expensive. Aquarists want to take better care of them. We’re the only source for a lot of this stuff.”

Many retailers are able to successfully direct customers to frozen and premium dietary offerings, growing sales and producing better outcomes for hobbyists in the process.

“Around 80 percent of my customers really care about what they’re feeding their animals,” said Anthony Vyeda, co-owner of California Reef Co., an aquarium shop in Newark, Calif. “Around 90 to 95 percent of people who come in to buy pellets, I end up pushing them to use frozen foods, because it’s better for their animals.”

Hobbyists are devoted consumers of aquatic dietary products, industry insiders reported.

“Most consumers we talk to—and we talk to a large number each month via phone, email and social media—want the best food they can find for their fish,” said Chris Clevers, president of Hikari Sales USA, a supplier of specialty fish diets in Hayward, Calif. “It’s simple: They want their fish to look good, grow fast and live a long life. They also prefer to do less maintenance so they can spend more time enjoying their fish.”

Retailers who emphasize dietary quality have better success selling premium diets, according to insiders.

“We have done a very good job educating our retailers and end users about the quality, freshness, diversity and benefits of our foods,” said Larry Dupont, owner and founder of LRS Foods, a fish food supplier based in Advance, N.C. “Many retailers demonstrate the feeding response LRS foods illicit by keeping store use packs handy to show how fish respond to the food as well as how clean it is. One tactic that really seems to have helped is that retailers will encourage a customer to buy a pack of our food because that is what the fish they are about to purchase is already eating.”

Natural ingredients are associated with quality in consumers’ minds, insiders noted.

“Most hobbyists are looking for food with natural ingredients,” said Jason Oneppo, research and development manager for San Francisco Bay Brand and Ocean Nutrition Americas, a Newark, Calif.-based manufacturer of fish foods. “Most of the foods on the market are natural products, as most brands have stopped using artificial colors and preservatives.”

Independent aquatics retailers have the experience and expertise to be the go-to source for high-quality aquatic nutritional products.

“If [independent retailers] are not the go-to source, they are missing a huge opportunity,” Clevers said. “The three things that most influence the success of consumers with their fish are food, water care and tank setup. As more people figure out that the information they find online is conflicting and, in many instances, wrong or misleading, retailers have an outstanding opportunity to be that trusted source. … Help your team be the food experts, act and sound like the food experts, and let consumers see your team members feeding the food you and your team have found to be the best. This will move the needle and allow you to capitalize.”

Product Development

Taking Stock

Although the events of 2020 and early 2021 prevented some fish food manufacturers from focusing on product development, new introductions are beginning to ramp up as industry trade shows return and conditions become more normal.

“We have a number of new foods in the works that we expected to introduce at SuperZoo in 2021, but the pandemic and the sales surge have delayed the introductions so we could keep the current items in stock for our retail partners,” said Chris Clevers, president of Hikari Sales USA, a supplier of specialty fish foods in Hayward, Calif. “At Hikari, we are constantly testing new ingredients to try to find more sustainable raw materials we can use that will also benefit the fish. To be honest, the amount of time, resources and money spent on this testing and lab work offers infrequent success. … Having a great marketing story is less important to us than having a good food that the fish can more fully utilize.”

Product development has been less of a priority as everyone in the industry has scrambled to keep up with much higher demand.

“Research and development, along with new product launches, were placed on the back burner,” said Larry Dupont, owner and founder of LRS Foods, a fish food supplier based in Advance, N.C. “Delivering our staple LRS blends, along with PE Mysis and Hikari frozen foods, was our No. 1 priority to help keep independent retailers stocked up with frozen foods.”

Nutritional products in development highlight demand in the hobby for natural ingredients and high-quality food offerings.

“We are developing an all-natural tablet food using freeze-dried ingredients that can be pressed against and stuck to an aquarium’s glass wall so fish can nibble at it, or it can be allowed to sink so bottom feeders can feed,” said Jason Oneppo, research and development manager for San Francisco Bay Brand and Ocean Nutrition Americas, a Newark, Calif.-based manufacturer of fish foods. “It is designed to provide daily nutrition, or it can be fed as a treat to a wide variety of fresh- and saltwater fish.”

Currently, the food’s ingredient list includes mysis shrimp, Antarctic krill, brine shrimp, Pacific krill, spinach, peas, pumpkin, carrot, cyclops and sweet potato, plus astaxanthin and spirulina, Oneppo stated.

Manufacturer support and strong sales have helped retailers meet high demand for all types of aquatic nutritional offerings.

“We sell a lot of Omega One and Hikari brand fish food,” said Annalise Roy, manager for Waterbury Aquarium, a tropical fish store in Waterbury, Conn. “We sell flakes, pellets and a lot of frozen, including frozen Hikari and Omega One lines, as well as live foods, particularly bloodworms and brine shrimp.”

Many retailers are eager to see new product launches, and they continue to support the brands with which they have had success.

“I have seen a few things from Hikari coming out,” said Anthony Vyeda, co-owner of California Reef Co., an aquarium shop in Newark, Calif. “I’ve seen a few different mysis shrimp products coming out, such as spirulina-enriched mysis shrimp. … I carry almost the whole line of Hikari frozen foods, and I also have Rod’s Food and some San Francisco Bay Brand frozen foods.”

Merchandising

Effective Freezer Placement

The best location within a brick-and-mortar aquatics store to place freezers for merchandising frozen fish foods varies depending on whom you ask, with freezers in the back of the store, the middle or near the back all complementing various sales strategies.

“Our freezer is in the middle of the store so that it’s accessible for customers,” said Annalise Roy, manager for Waterbury Aquarium, a tropical fish store in Waterbury, Conn. “It doesn’t have glass doors. We try to keep it organized so customers can find what they want easily. We also have a regular fridge for some of the live stuff.”

Some prefer to keep their freezers near the front of the store, but many retailers reported that they are considering adding additional freezer units to keep up with demand.

“I have a full-sized, commercial freezer, and it’s packed full of frozen food,” said Anthony Vyeda, co-owner of California Reef Co., an aquarium shop in Newark, Calif. “It has a glass door and a Reef Nutrition wrap on it. I keep my large freezer by the register right up front because it sells so much. I’ve contemplated getting a second freezer, actually.”

Locating freezers near other food offerings and livestock helps increase foot traffic and grow impulse purchases.

“Flake food occupies maybe 15 percent of what we have, with the rest being pellets, freeze-dried and wafers,” said Greg Housley, owner of Optimum Aquarium, a tropical fish store in Kennesaw, Ga. “I have a glass double-door freezer with probably 60 different sizes and types of frozen food. Some of them are doubled stacked. I really could use another whole, large freezer to merchandise it the way I would like to merchandise it.”

Housley displays his freezer toward the back of his store, near the fish room. Locating the freezer near the back of the store helps to put more of the store’s offerings in front of customers, he said.

Jason Oneppo, research and development manager for San Francisco Bay Brand and Ocean Nutrition Americas, a Newark, Calif.-based manufacturer of fish foods, noted that freezer placement is key.

“Merchandise frozen foods in a glass-door freezer using spring-loaded trays,” Oneppo suggested. “Having a neat and organized glass-door freezer will lead to additional sales. … Also, place the freezer towards the back of the store or in an area where customers will have to walk down aisles of aquatic goods to get to it, increasing the chances of additional purchases.”