You finally happed on a great business idea and now want to find out how to start a dog breeding business. Well, like all businesses, beginning a dog breeding business is a huge step and requires proper investigation and what not to ensure that you do things right and earn maximally from your business.
In one of our articles, we answered the question: “how much should I charge for dog walking?” That article addresses everything you need to know about setting up your dog walking business. If that’s what you’d rather do, click here to read How Much Should I Charge For Dog Walking?
That said, our guide today is an exhaustive one, addressing every single thing you need to know about setting up shop as a dog breeder. It covers everything you need to know about making your business legally compliant and very profitable.
First Things First
So, the first thing you should know about a dog breeding business is that it stands on three legs, each of which is super important.
You have the dogs which are the priority, of course. Then we have the breeding which is what the business is about in the first place. Then we have the business part which is how you reap the rewards of the good job you’ve done with breeding your dogs.
Most dog breeders are so passionate about dog breeding, they believe that you cannot do dog breeding and still draw a profit. This is simply not true. You can do an excellent job at breeding dogs and still draw a profit, a good one at that.
Dog breeding is serious work, people. You’re going to have to spend a lot of money, visiting the vet and getting other essentials. Compared to raising a single pet, dog breeding costs significantly more. Turning this passion into a business, if you want to, is not an ignoble intent and you should actively pursue it if you want to.
Why Go Into The Dog Breeding Business?
Whatever breed of dog you decide to raise, there’s definitely a market for them. Pet dogs such as Chihuahuas and Hoodle Poodles have a good market, especially among women. Guard dogs as well such as Rotts, GSDs, Pit Bulls, and Dobermans also have a large and growing market especially with the increase in crime rates around the world.
Some people believe that breeding is bad and that the world is already overpopulated with dogs. Well, breeding is only bad if you don’t know how to do it correctly and you end up producing unhealthy puppies. Once you know how to do it right, there’s definitely a huge market waiting for you and you can make good money from your passion.
Some Interesting Stats About The Dog Breeding Industry
As at 2014, the US pet products and services industry was worth about $73 billion and even now, this industry is still growing. More and more households are getting pets, both dogs and cats, and, therefore, are in constant need of pet products and services.
Comparing dogs to cats, 45 million homes in the United States have a dog while 30 million homes own cats. Among the dog owners, 52% own small dogs (under 25 pounds), 32% own medium dogs (between 25 and 40 pounds) while 42% own large dogs (over 42 pounds). From the stats, it appears that households in the US seem to be favoring small and large dogs over medium-sized dogs as the percentage of small and large dog ownership in the US appears to be experiencing an increase while that of medium-sized dogs seem to be holding steady.
Experts predict that this shift towards smaller pets will continue to increase as the years progress especially because of the aging human population.
Now, this shift portends many things for the pet market in the United States.
First off, smaller pets eat less so pet food manufacturers might suffer in as volume of sales might fall. However, by switching to breed-specific and size-specific dog foods, these companies might be able to make up for this loss. Royal Canin and Mars’ Cesar have used this strategy with significant success.
Planning Your Dog Breeding Business
Now, for any project you’re going to go into at all, you’re going to have a plan, and coming up with this plan involves a lot of brainstorming. You’re going to have to answer some very important questions with your head (not your heart) to be sure of exactly where you’re going with your business and what you want to do.
- What am I going into this business for? — passion for dogs or money or?…
- Am I willing to start out on my own? Do I have the needed motivation to put in all the grueling work required to build a business for the next few years.
- When things start to go rough, will I have the tenacity to remain?
- How do I intend to make money from my business? Will I follow the trends? How about when the trend fades?
- Is there a market in view for my favorite breed? How tough is the competition?
- How can I improve my favorite breed? What are the diseases specific to this dog breed?
And there are many more questions but you get the idea now, right? Please, be as honest as you can be when answering these questions and if you like them, you can go ahead and draw up your business plan.
Whether or not you need external funds is immaterial to drawing a business plan. Business plans are not just necessary for submitting proposals. They also give the business owner a clear idea of their objectives and vision. It’s a blueprint and guide for when you get stuck as you continue in business.
Before we continue with this article, check out the video below on how to start a dog breeding business. It should give you something to chew on while you peruse the entire article.
How To Start A Dog Breeding Business — Market Research and Feasibility Studies
You’d need to research into the demographics and psychographics of your target market. There are different groups of people from the private sector, to the public sector, to separate individuals who need dogs. These include pet lovers, government security firms, private security establishments, research establishments, and pet training firms.
Now, just how competitive is this industry? This is another thing you’re going to have to look into when running your market research.
The dog breeding industry is quite competitive like any other business field. However, don’t be too consumed with the competition. Instead, stick to your business plan and ensure that you do your business efficiently and give your customers a high level of satisfaction.
Before we leave this section, another thing you will find from your market research is that there are niche areas where you can specialize in the dog breeding industry. Some of these niches include dog grooming, dog training and instruction, dog walking, dog sitting, vaccination, and mating services.
Economic Analysis Of Starting A Dog Breeding Business
Thankfully, beginning a dog breeding business is not so capital intensive. You simply need to get all the necessary equipment and supplies, and then insurance. Once you’ve got those, you’re ready to go.
The main challenge you might experience is getting business. However, if your pups are healthy and adorable, you shouldn’t have such a hard time locating buyers even with little to no advertising.
That said, there isn’t only one way to begin a dog breeding business. You could set up yours like we’ve been talking about but you could also buy a franchised operation. You’ve probably considered this option already but what do we think about this idea?
Well, we wouldn’t go for franchising if we were you. Setting up your own dog breeding business is quite easy and there are loads of resources to help you to get it done perfectly too. So, why tie yourself down with the obligations that come with buying a franchise?
If you start from the scratch on your own, your initial investment is low and so are the overhead costs.
That said, there are still some challenges that come with starting a dog breeding business.
Challenges Of Starting A Dog breeding Business
- It can get quite expensive running vet care and genetic testing for your dogs. Why genetic testing? Well, some customers might require a genetic test to rule out hereditary as well as congenital disorders. Now, how many of these tests you’d have to run would depend on the breed you’re raising and their genetic predisposition for certain disorders. So, tests could easily run into thousands of dollars
- There are no guarantees in the dog breeding business. You must be comfortable with risk-taking. If you have a small litter (which small breeds commonly have), you’d have invested a lot of time, money, and effort for little profit. If you have a larger litter, then your running costs increase correspondingly.
- Monthly income is not steady as you’re not going to be breeding dogs every month. Remember that you can only breed a female once a year and then you still have to maintain the mother’s health as well.
- To fully promote your dog breeding business, you might have to build your own website or buy classified ads. Inexpensive ads in vet offices work too but they don’t do as much for your business as classified ads or owning your own website.
Cost Analysis For Starting A Dog Breeding Business
You are going to be incurring quite a lot of expenses before launching your dog breeding business. Of course, your location will have an impact on how much you have to spend when launching your business ultimately. This is why one of the first things you do when deciding to embark on a dog breeding business is to conduct market research and feasibility studies. Do this before you draw your budget and source for funding.
Here is a rough idea of how much it takes to launch a dog breeding business in the United States.
- Business incorporation fee in the United States: $750
- Insurance, licenses, and permits: $5,000
- Renting and reconstruction of a suitable litter facility: $10,000.
- Purchase of founding dogs: $20,000.
- Launching an official website: $700
- Signage, business cards, and similar acquisitions: $2,500.
- Miscellaneous: $8,000.
Other expenses you should expect to incur are stud fees, food for the dogs, shots and tests for the puppies as well. You’d also have to register with the American Kennel Club. It takes about $100 to register your business, $25 for your litter registration (with $2 per puppy). You can check out the fee schedule for the AKC here.
If you want to keep your costs low, then we advise that you begin with one female dog. You can breed one female dog in your home and then as you begin to make some profit, you can reinvest the proceeds into the business and expand.
Ongoing Dog Breeding Business Expenses
Ongoing expenses you’d incur as a dog breeder include getting dog food, vet costs for mothers and puppies, and AKC reg fees. Remember, every dog must be tested by a vet and registered with the American Kennel Club.
Getting Funds For Your Dog Breeding Business
There are a number of ways you can raise funds for your dog breeding business.
1. Your Own Money
First things first, analyze your assets by running an inventory of everything you own. Many times, people don’t realize it right away but they have a number of assets on hand already from real estate equity, savings accounts, vehicles, retirement accounts, recreation equipment, loads of other investments.
You could decide to sell off these assets to get cash or you could decide to use them as collateral when obtaining a loan.
You could also check your credit line. A number of successful businesses have started on credit cards.
2. Friends and Family
After you’ve gathered your own money, the next set of people to turn to, naturally, are your friends and family since they believe in you and would want to see you succeed.
However, you still want to be careful when approaching friends and family for money as money matters have turned many a great relationship sour. Still present yourself professionally and put things in writing, however close you are to the individual(s).
There is strength in numbers, they say. So, look around you. Is there someone you know who might be interested in running a dog breeding business with you? Or is there someone who has the money to invest but doesn’t care about putting in the work? You could approach any of these people and form a partnership.
Of course, there should be a written agreement where your individual obligations and obligations are clearly defined.
4. Government Programs
There are quite a number of government programs that seek to help and support small scale businesses. Your first stop should be the U.S Small Business Administration.
There are also programs aimed at women, veterans, and minorities as well.
You can begin researching in the business section of your local library.
Legal Aspects Of Starting A Dog Breeding Business
Choosing the legal entity you wish to adopt for your business is another aspect of your business that you want to consider. It determines how large your business would be able to grow in the end.
Many business owners choose to leave their businesses as sole proprietorships while others go on to form a limited liability company (LLC) or a corporation. The latter option helps you enjoy a number of legal and tax protections which is why legal experts will advise you to go with registering as a corporation or as a limited liability company.
Check out this video that clearly explains why you should incorporate your business or form an LLC.
Intellectual Property Protection And Trademark
When beginning your dog breeding business, it’s important to consider filing for the protection of your intellectual property. Your intellectual property would include your logo, name, and other necessary documents.
To begin filing for the protection of your intellectual property or to register your trademark in the United States, you’d have to refer to the USPTO. Begin the process by filing your application with the United States Patent and Trademark Office. Then your application will be reviewed and approved by some attorneys over at the USPTO.
Legal Documents Required To Start and Run Dog Breeding Business
For running a dog breeding business, you don’t really need any professional certification. All you need is your love and passion for dogs. That’s all.
You might decide to get additional certification for dog training or dog grooming. But dog breeding, generally, does not require professional certification to begin.
Nonetheless, there are still some legal requirements you need to start and run a dog breeding business.
First, if you have 6 or more female dogs older than 6 months and capable of breeding in your building, you’d need to apply to the local authorities as a dog breeding establishment. Also, you’d be required to pay a fee for that application except you’re a registered hunt club, a commercial boarding kennel, or a charitable organization.
When the establishment has been registered successfully, the breeder will be given a certificate which they must display prominently within the premises of the establishment. On their registration certificate, you will see information such as the address of the breeding establishment, the details of the applicant, the max number of bitches the holder can have in their premises per time, as well as other conditions that come with registration.
Then, you’ll also need to register your business with the government. The laws surrounding this differ from state to state.
When you’re ready to register your business, simply go to your local Department of Commerce as well as the Department of Licensing to get the necessary forms and to inquire whether or not you’d be needing a license to do your bookkeeping.
Afterward, you can inform the federal government of your dog breeding business by applying for an Employer Identification Number (EIN). You could also create your business name by filing a DBA (Doing Business As) notice.
Here are some basic legal documents you’d need to begin a dog breeding business in America.
- Certificate of Incorporation.
- Business license.
- Non-Disclosure Agreement (NDA).
- Memorandum of Understanding (MoU).
- Employment Agreement.
- Operating Agreement.
- Company By-laws.
- Operating Agreement.
- Operating Agreement for LLCs.
- Insurance Policy.
Choosing A Good Insurance Policy For Your Dog Breeding Business
You’ll need to get business insurance which includes general liability, product insurance, workers’ compensation (if you’ll be hiring), home-based insurance to protect your assets should there be a lawsuit or settlement.
Workers’ compensation will help to cover the cost of treating an employee who gets an injury or accident while on the job.
You might also have to get a surety bond which helps to promote a transparent relationship between customer and business owner. If there’s a lawsuit or settlement, this insurance will cover the legal expenses.
Drawing Up Your Dog Breeding Business Plan
Your business plan is another legal document you must have if you intend to register your dog breeding business. Thankfully, to draw up one isn’t exactly rocket science and you might not necessarily need the help of a professional to get it done.
When it comes to business plans, the main deal is to list the things you will be spending money on and the things that will be bringing in the money. At the very core of what a business plan is, that’s what you’re doing.
Here are the things you want to be considering when drawing up a business plan.
- Summary of the business plan.
- A management and operating plan.
- Competitive analysis.
- Market analysis and a marketing plan.
- A financial plan.
Registering For Taxes
As part of the legal processes for your dog breeding business, you’ll also need to register your business for federal and state taxes. You’ll need to apply for your EIN to get this done. Simply go through the IRS website and follow the instructions. It’s free, by the way.
Opening A Business Account
To protect your personal assets, it’s best to use a separate account dedicated to your business transactions. If your personal and business accounts are mixed, you put your personal assets such as your car, home, and other valuables at risk. For instance, say your business is sued, if both accounts are mixed, your personal assets will also be affected. Business law refers to this as piercing your corporate veil.
Besides protecting your personal assets, opening a dedicated account for your business will also make tax filing and accounting a lot easier.
After opening your business account, you’d also have to get a credit card for your business. Again, this is important to separate your business expenses from your personal expenses by having all your business expenses in one place. Plus, when you open a credit card for your business, you build your credit history as a business which will come in handy when you need to raise money or seek investment later.
Don’t forget to ensure that you keep a record of all your expenses as well as income sources so you can understand how your business is performing financially. Besides, it also helps to make things easier when you have to do your annual tax filing.
In the video below, check out the video below to further understand why it is important to open a separate business account from your personal account.
How To Start A Dog Breeding Business — Choosing Location
A common trend in starting businesses today is to do it home-based. Dog breeding is a business that can work great home-based as long as you have the required space. If you stay in an apartment, the home-based dog breeding might not be the best idea for you.
But just before you run off and open your dog breeding business in your house, remember that many areas have laws regarding what kind of business you can run in a residential area and even the volume of business as well.
In fact, for some, there’s an outright prohibition of home-based commercial activities. Others might place restrictions on traffic, noise, employees, signage, and commercially marked vehicles.
So, before you apply for a business license, you might want to find out what the situation is with home-based businesses in your area.
How To Start A Dog Breeding Business — Equipment And Labor
Generally, dog breeding doesn’t require a lot of manpower or equipment. You can run it alone or if you choose to expand to a medium scale, then you might require about 4 workers. Anything more than 4 workers, then you’re running a large scale dog breeding business. When it comes to dog breeding, it’s important to let the number of dogs you have determine how and when you expand. No need having 4 workers if you don’t have that many dogs to handle.
How To Promote And Market Your Dog Breeding Business
Your dog breeding business will not gain popularity by itself no matter how good you are. You will need to let people know about the good work you’re doing.
You’d need to do your work both online and offline. Facebook is a great place, of course. But don’t forget forums and message boards as well.
Getting your website is also important so people can easily find you through a Google search. Of course, the website should have your name as well as your contact details so people can reach out to you if they want to.
Offline, you’re going to have to go out often with your best dogs to relevant dog events. Depending on your breed, you can take your dogs with you to dog shows of various categories including flyball, agility, swimming, racing, herding, as well as other dog sports.
Whether your dog wins or not is not really material. The important thing is that your dog gets noticed by potential buyers and breeders. And you don’t always have to travel so far. You can check around for such events in your locality which you can attend.
Making Money As A Dog Breeding Business
Charging Your Customers
So, how much can you charge your customers for a puppy? Well, generally, dog breeders charge from between $500 to $3,000 for a puppy.
How much your puppy will cost on this scale would depend on the pedigree of its parents as well as the level of care you put into breeding your dogs.
Responsible breeders won’t breed dogs with genetic/congenital health issues or behavioral problems. This, of course, gives them the liberty to charge more as they’d have to cover the costs of raising such dogs.
Now, just how much can you make as a dog breeder can make will depend on the quality of dogs(s) you have and how many litters you are able to get per year.
High-end breeders may get four litters in a year but sell the dogs for $2,500 each. Now, say each litter had 6 dogs, that will account for about $60,000 for the business that year.
For low-budget breeders, profits are significantly lower. Since the quality of dogs they have in their litters would not be as high as those of high-end breeders, they can’t charge as much. In most cases, these dog breeders might sell their dogs at $800 for each dog.
Necessary Skills To Build A Successful Dog Breeding Business
Some skills that can help you build a successful dog breeding business include, firstly, being familiar with the breeding process. You should be able to select dogs that are suited for each other for the mating process.
You should also know how to birth dogs and be confident at it. Taking your dogs to the vet for each birth can gradually become expensive. (To learn more about dog whelping, click here to read our article: How Long Does It Take A Dog To Give Birth?)
Thankfully, there are courses you can also take to help you get better at your craft. The American Kennel Club offers courses on breeding systems, genetics, pedigree, and many more. You can take these courses for free and pay a small fee to get the official certificate.
Furthermore, to ensure your pups are healthy, you’d need to know the necessary tests and shots your puppies will need after birth. Again, the AKC has resources that can help you.
As a breeder, you should also become very familiar with the breed you’ve chosen to specialize in. Read books about the breed and join organizations that work with such breeds so you can learn more about them.
Best Dog Breeds To Begin A Dog Breeding Business With
Since you’re just beginning your dog breeding, it’s best to begin with a small number of puppies even if you can afford much more than that. It makes breeding easier for you, especially as a first-time breeder.
The most recommended dog breeds for first-time dog breeders are German Shepherds (Alsatian), Boerboel, and Rottweiler puppies.
Lastly, before you select a particular dog breed, you might want to research and find out what dog breeds easily adapt to the environment and sell fast as well.