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How to Start a Dog Breeding Business

Overview

How to Start a Dog Breeding Business

For many dog lovers, a career centering around animals sounds like an ideal option. If you have experience in dog breeding and want to produce quality dogs that enhance their breeds, then starting a dog breeding business might be a rewarding opportunity. As the owner of a breeding business, you’ll spend plenty of time with your dogs every day. But there are challenges to becoming a dog breeder, too. Read on to make sure that this is the right career move for you.

Business Overview

Dog breeding businesses work to supply families, show dog owners, and even working dog owners with well-bred dogs who are suited for their purpose. Breeders often specialize in one certain breed of dog, and they carefully select pairings to pass on the best qualities to the puppies.

Many dog breeders who specialize in show animals also compete with their own dogs. Often, breeders have strict requirements for evaluating potential buyers. Breeding operations also vary widely in size. Some breeders may breed a litter or two a year, while larger operations may almost constantly have puppies available.

While breeding dogs gives you a chance to make a career out of your love of dogs, this business sometimes brings heartbreak with it, too. Births can sadly go wrong, and you’ll need to be prepared to face the potential loss of puppies and, sometimes, of your much-loved breeding dogs. While careful, deliberate breeding and regular vet care can help to minimize the risk of health problems, breeding is an activity that’s never entirely without risk.

Industry Summary

According to IBIS World, the dog and pet breeding industry experienced a 3.2% decline from 2014 to 2019. This decline was due to a number of factors, including stricter regulations of puppy mills. The 2017 “Adopt, Don’t Shop” campaign pressured pet owners to adopt pets from shelters rather than buying from breeders, which led to reduced demand. As a result of that campaign, many pet stores opted to partner with local rescues instead of selling puppies from breeders.

In 2019, there were 214,439 breeding businesses in operation, and the industry employed 219,743 people. The pet breeding industry brought in $2 billion in revenue.

While public concern over puppy mills and pressure to adopt is likely to continue, there are still opportunities for dedicated, quality breeders within this industry. Moving forward, breeders will need to demonstrate their dedication to breeding quality dogs in humane, ideal conditions to combat some of the negative perceptions that surround the industry.

Industry Trends

As different dog breeds come into popularity, the prices and demand for those dogs fluctuate, which can affect dog breeders. According to Orvis, popular TV shows and movies can prompt a breed to gain popularity, though the effect is often temporary. For instance, the 101 Dalmations movies caused Dalmations to surge in popularity, while the Game of Thrones series prompted families to seek out more Huskies. In some cases, media can cause a breed to be popular for as long as a decade, but this popularity is a trend and does end. Breeders may adjust their breeding programs to take advantage of the trends, but they also need to be prepared with a plan for when the breed’s popularity drops off.

Target Market

On the basic level, dog breeders market to people who want to be dog owners. However, individual breeding programs may have more refined target markets. A business that focuses on breeding show dogs will market to enthusiasts who want to own or compete with a show dog. Breeders of certain sporting breeds may market to owners who would provide their dogs with working homes.

Checklist for Starting a Dog Breeding Business

If you’re thinking about starting a dog breeding business, it’s important to do your research first. Here is a checklist to help you get started.

Step 1: Write a Business plan

After coming up with the idea, the next step in starting your business should be to write a business plan. Not only will a bank require you to have a business plan, but multiple studies have shown that a business plan helps increase the odds of starting a successful business.

Related: How to write a business plan

Step 2: Form a Business Entity

A business entity (also referred to as a business structure) refers to how a business is legally organized to operate. There are four primary business structures to choose from, which include the sole proprietorship, partnership, corporation, and Limited Liability Company (LLC). Each type of entity has its own pros and cons, such as liability exposure, costs, and administrative requirements.

When deciding on which business entity is best for a dog breeding business, it normally comes down to the sole proprietorship and Limited Liability Company.

A partnership opens the owners up to unnecessary personal liability because if a partner does something to get the business sued, or runs off with cash from the business, the other partners are personally liable to repay.
 
The corporation can be a good choice to minimize liability risk because it separates the business assets from the owner’s assets. If the corporation is sued or certain business debts can’t be paid back, the owners aren’t personally responsible to repay them. The downside to the corporation is that it is more complicated than all the other entities and requires more administration than the LLC. If you plan on raising a lot of investment though, the corporation is usually the better choice.

That leaves the sole proprietorship and LLC.

The sole proprietorship is the least expensive and easiest entity to start which is appealing. The downside is that the owner is personally liable should anything happen to the business, which is an important consideration. The LLC offers the ability to operate as a sole proprietorship with the liability protection of a corporation. Depending on the state, the cost to form an LLC runs from $40 – $500, which is pretty inexpensive for protecting the owners from business-related lawsuits and certain debts.

Related: Guide to forming your LLC
 

Forming an LLC sounds complicated and expensive, but using an entity formation service guides you through the process so you know it was done right.


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Step 3: Choose a Business Name

Finding the perfect business name for a dog breeding business can be challenging. Not only does the name have to resonate with your customers, but it also has to be available to use.

Step 4: Select your Location

Because of the amount of frequent care that dogs and puppies need, most breeders run their businesses out of their homes. Some renovation or expansion may be needed to create kennels and safe yard areas for the dogs and puppies. Since you are working with animals that will sometimes be noisy, be sure to check zoning and covenants in case you have a neighbor that doesn’t approve.

Related: Choosing a business location

Step 5: Apply for Business Licenses and Permits

A commercial dog breeder license is needed through the US Department of Agriculture (USDA) under the Animal Welfare Act (AWA). See the Dog Breeder Resource Guide.

Additionally, most states have animal health laws and licensing requirements for commercial pet breeders once they exceed four dogs.

Last, most states will require commercial dog breeders to obtain a sales tax permit, and some breeders will also need to get an Employer Identification Number (EIN).

An optional cost, though one that may greatly increase dogs’ value, is American Kennel Club (AKC) registration.

Related: Common business licenses, permits, and registrations by state

Step 6: Open a Business Bank Account

Keeping your small business and personal finances in separate bank accounts is important to track the income and expenses of your business and identify trends.
 
Many banks offer free business checking accounts, so be sure to find a cost-effective option for your business.

Step 7: Get your Marketing Plan in Place

After you define your target market and do thorough market research, it’s time to create a promotional strategy. A dog breeding business’s marketing activities may include building a website, maintaining a social media presence, networking with local dog trainers, and even advertising online.

Related: Low-cost ideas to market a new business

Every business is going to need a logo. Make a professional logo in no time with the free Canvaa logo maker!

Step 8: Get Business Insurance

There are several types of insurance to consider when starting a dog breeding business. A few of these include:
– General liability insurance policy protects the business if customers are ever hurt while on the property. Liability insurance can help to cover expenses like lawsuits, fees, and medical bills.
– Commercial property insurance can cover the cost of damaged or destroyed equipment during an event like a fire.
– Worker’s compensation insurance helps cover expenses like lost wages and medical bills that can result if an employee is ever injured while on the job.

The cost to insure a pet breeding business varies depending on factors like the business’s location, the value of its equipment, and the number of employees on staff. To get the most accurate idea of what to budget for insurance, request quotes from multiple providers. When comparing the quotes, don’t just look at how the premiums stack up. Instead, be sure to also consider other details like coverage limits, exclusions, and deductibles.

Step 9: Hire Employees

Owners of smaller dog breeding operations can often manage the entire business by themselves, but it may be necessary to bring in help as a business grows. According to ZipRecruiter, dog kennel staff earn an average salary of $24,075 per year or approximately $12 per hour. Depending on the location and a worker’s experience, the salary can be as low as $15,000 and as high as $31,500.

In addition to budgeting for employee salaries, a business’ budget also needs to include other expenses that come along with hiring staff. These additional expenses include paid time off, health insurance contributions, and worker’s compensation insurance.

Related: Hiring your first employee

How much does it cost to start a dog breeding business?

It’s possible to start a smaller dog breeding business with a limited budget, especially if a breeder already owns dogs suitable for use as breeding stock. It’s possible to start a small operation for around $500, while larger businesses with many dogs can cost closer to $15,000 or $20,000.

Some common startup costs for a dog breeding business include:
– Facility expenses such as kennels and any property renovations
– Equipment and supplies
– Dog food, veterinary supplies, vaccines, tests, vitamins, supplements, etc
– Breeding stock
– Signage

How much can a dog breeding business owner make?

Dog breeding business income will depend on many factors, including the number of litters, pedigrees, breed of the dog being sold, and even the dogs’ purpose, like whether they’re intended to be show dogs, working dogs, or pets. Salary.com reports that dog breeders make an average salary of $52,549, though salaries most often range between $46,743 and $58,801.

Some of the best dogs to breed in terms of profit, according to K9ofmine.com include:
– Akita
– French Bulldog
– German Shepherd
– Labrador Retriever
– Otterhound
– Pharaoh Hound
– Rottweiler
– Saluki
– Samoyed
– Siberian Husky
– Tibetian Mastiff

It’s also important to be prepared for significant, unexpected vet bills. A sick puppy or a birth defect can find you traveling to the emergency vet, and bills for even a single visit can be thousands of dollars. You’ll want to establish an emergency vet bill fund to have on hand, just in case. Some pet insurance companies may also provide coverage for breeders, which can minimize some of these vet bills.

What skills are needed to run a dog breeding business?

Starting a dog breeding business doesn’t require a business degree, but certain skills and experiences can increase the business’s chances of success.

Dog breeding experience. Experience in and knowledge of dog breeding are essential when starting a breeding business. Dog breeders should know good breeding practices, care for pregnant dogs, and recognize and manage labor and then care for new puppies.

Knowledge of dog genetics. Breeders need to understand genetics so that they can choose breeding pairs that will pass on good characteristics and produce quality offspring. An understanding of genetics is also essential in avoiding some hereditary conditions and ensuring that the puppies have the best chance of being born healthy.

Dog training experience. A breeder with experience in dog training can work to make sure that every puppy is well-socialized and has some basic training before it goes to its new home.

Pet first-aid skills. Dog breeders need to be comfortable doing basic first-aid and triaging an emergency until they can get the dog to the vet. Experience in a veterinary setting or some pet first-aid training is beneficial.

Interpersonal skills. While dogs are the main focus of this business, strong interpersonal skills can also help a breeder engage with potential buyers and find their puppies suitable for new homes.

Are there grants to start a dog breeding business?

It’s extremely rare to find a grant to start a dog breeding business. If you search for business grants, you will come across a lot of scams and misinformation. Occasionally an organization will offer grants to start a business, however, be skeptical and don’t provide any sensitive personal information or pay money to get more information.

Legitimate federal grants can be found at Grants.gov, and you can check on your state’s economic development office to see if they have any grants available.

What is the NAICS code for a dog breeding business?

The NAICS code for a dog breeding business is 112990.

The NAICS code (North American Industry Classification System) is a federal system to classify different types of businesses for the collection and reporting of statistical data.

Related: What is a NAICS code?

Resources:
American Kennel Club
International Working Dog Breeding Association
Natural Rearing Breeders Association

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