Region/Countries: Asia, South Korea Industry: Food and Beverage, Other Date: February 2016

Why this is important to Wisconsin businesses: The growth in pet food and other pet products and services presents opportunities for Wisconsin companies.

As the population with companion animals has reached over 10 million, the market for pets in South Korea has been growing rapidly. The market, which hit $1.4 billion in 2014, has enjoyed double-digit growth, and is forecast to exceed $2 billion in 2016 and triple to $6 billion in 2020. The growth of the market reflects socioeconomic changes in Korean society, such as an increasing number of single-person households, income trends, low birth rate and aging population. With increasing interest in companion animals, owners' deep emotional attachment to their pets leads to growing demand for more sophisticated and diversified products and services.

The pet food market is growing rapidly, and is projected to reach $600 million in 2020—almost double the 2012 value of $320 million. As more and more pet owners regard their pets as family members and are treating them accordingly, the demand for premium pet food such as organic, non-GMO, preservative-free, handmade and health functional pet food is growing. According to one of the leading online shopping malls, Interpark, sales of health functional food for dogs increased by 364 percent and for cats increased by 86 percent in the fourth quarter of last year from the same period the year before. Imported brands such as Nestle Purina and Mars have dominated the South Korean pet food market. The industry’s potential has attracted local conglomerates such as CJ CheilJedang, Dongwon F&B and Sajo Industries, and many companies have been actively entering the market and introducing a variety of products.

Not only the pet food market, but also pet fashion and beauty, as well as other product and service businesses, have been enjoying the growth of the pet economy. With the expansion of the market, products and services are becoming more specialized and sophisticated, and clinics, beauty shops, cafes, hotels and funeral service businesses targeting pets have proliferated in South Korea.

As the growth is expected to continue with an increasing number of single-person households, this could be a good opportunity for Wisconsin companies providing value-added and quality products to find opportunities in the Korean market.