Executive Summary
The value of corporate social responsibility, sustainability, and business ethics cannot be overestimated. While the pet goods industry is relatively new, it already has businesses that are successful, competitive, and effective. PetSmart’s mission, values, and vision correspond with its ideas to help solve environmental issues, help pet owners who cannot care for their cats and dogs, and also make sure that employees and customers feel included and welcomed. In order to be effective in its strategy, PetSmart creates various initiatives. They are keeping homeless animals in PetSmart stores and finding them loving families, providing low-income owners access to veterinary services, sending humanitarian help after disasters, and donating money to other organizations that support animals. As for business ethics, PetSmart follows its principles by training employees, promoting diversity and inclusion, and having sincere and positive relationships with partners. While PetSmart has made some mistakes, including misunderstanding one of its product’s characteristics and selling reptiles while having the ‘no selling animals’ policy, the company learns and improves. When compared with competitors like Petco, PetSmart may have different approaches to sustainability but still remains effective. Therefore, this corporation can indeed be called one of the best in following all the outlined principles and in helping the environment recover.
Introduction
The retail industry may face numerous challenges and obstacles, which is why it is required from companies to put enormous efforts into becoming more competitive, recognized, and profitable. For instance, those firms that are sustainable and adhere to ethical principles, follow the code of conduct, and value corporate social responsibility are more likely to be respected by customers and employees. The pet goods market is now more demanded than ever, which is why it may be insightful to review a corporation from this industry. The purpose of this paper is to prove that PetSmart is one of the best in being sustainable and taking corporate social responsibility seriously.
Industry Analysis
To begin with, it is essential and quite insightful to conduct a thorough analysis of the market that PetSmart operates in. Overall, PetSmart is one of the several most competitive companies in the pet care and retail industry, and while the industry is profitable and successful, it is relatively recent. As a result, according to Roberts (2022), while some industries like beauty, health and wellness, and fashion have been explored in detail, there is not enough research available to cover all questions and themes related to the pet market. However, the main issues facing the market, as well as some worst and best social and environmental performers in this industry, can still be identified.
First of all, one of the key concerns of firms operating in the market under discussion is fierce competition and a number of strong, successful, and respected companies, including PetSmart. For example, some retail stores like Amazon decided to sell pet goods, which is not their main specialization (Pet Business, 2017). Nevertheless, pet owners find it convenient to add food, toys, and other things for their pets to the Amazon cart when placing their usual orders. According to Roberts (2022), this fact makes firms focused on pet goods retail lose their potential clients and find other, often costly ways to attract buyers and persuade people to purchase from them. Those companies that do succeed are required to compete with each other by leveraging the in-person experience, expanding the variety of products, and providing expert service.
Another issue is related to increasing competition and growing demands of pet owners, who tend to perceive and treat their cats and dogs as family members. Thus, it is observed that the available food, toys, furniture, and treats options do not always satisfy buyers (Roberts, 2022). Consequently, pet stores have to find ways to expand their range of goods and offer products not available for purchase from competitors (Pet Business, 2017). As for the issues faced by global value chains of the pet retail industry, they are connected with the lower ability to produce and offer what the client wants and also with external economic and political concerns. Thus, supply chains are severely disrupted, and people are now returning to their workplaces after having to work from their homes (Phillips-Donaldson, 2020). The global value chains are in the process of recovery but already have to satisfy the increased demands of customers, which causes stress and further disrupts the processes.
Further, it is possible to explore the best and worst pet retail companies in relation to sustainability and care about environmental and social issues. First, one may note that every pet store chain or retailer, in general, can violate some rules and principles either by ignorance or by willful neglect. For example, most sources state that PetSmart is an extremely eco-friendly, sustainable, and socially caring company, and a vast number of its initiatives and programs prove the same (Kotler, n.d.; Larkin, 2022). Its competitor Petco, a highly reputable and successful pet store chain, is also recognized as an environmentally friendly and supportive retailer. Noticeably, in 2017, Petco “has been recognized by the Ethisphere Institute, a global leader in defining and advancing the standards of ethical business practices, as a 2017 World’s Most Ethical Company” (Nabozny, 2017, para. 1). Therefore, these two companies can be recognized as the best performers in the industry, but there are some mistakes made by them that require mentioning.
Overall, PetSmart and Petco failed to provide clear and truthful information to their clients. According to Johnson (2021), “the companies sold pet waste bags and other plastic products labelled with misleading claims about their biodegradability” (para. 2). As a result, they had to pay for their mistakes and confusion, which also resulted in inevitable harm to the environment and customers. Therefore, this case proves that even the best sustainability performers can fail to consider everything. Further, there is a company that can be recognized as the worst performer in the industry – Petland. The investigation revealed, “that Petland stores across the country have marketed puppy-mill puppies to unsuspecting consumers” (The Humane Society of the United States, 2008, p. 1). In other words, the organization failed to be socially responsible and sincere to its buyers.
Company Overview
PetSmart is an American pet superstores chain founded in 1986 and headquartered in Phoenix, Arizona. According to the company’s official website, it is “the largest specialty pet retailer of services and solutions for the lifetime needs of pets” (“About PetSmart,” n.d., para. 1). PetSmart “operates approximately 1,650 pet stores in the United States, Canada and Puerto Rico, as well as more than 200 in-store PetSmart PetsHotel dog and cat boarding facilities” (“About PetSmart,” n.d., para. 2). The company offers its customers a wide range of goods and products for pets, including food and treats, toys, waste disposal, and furniture, at competitive prices. What is more, clients can receive high-quality services like pet adoption, boarding, and grooming, dog training, and PetSmart Doggie Day Camp.
Since 2015, the company has been owned by BC Partners, an international investment firm from England. PetSmart has its own division – PetSmart Charities, which is a rather profitable and beneficial decision. As for the ownership and some disadvantages it probably brings to the company, one is that BC Partners have a larger share of PetSmart’s business, and both parties can have varying values that do not relate to each other. The latter may result in lower profitability and a spoiled image of the pet store chain. Regarding PetSmart’s governance structure, it is a rather positive one. As stated by PetSmart (2014), its “Board of Directors has developed corporate governance practices consistent with its duties of good faith, due care and loyalty to help it fulfill its responsibilities” to the stockholders (p. 6). Therefore, no issues are expected, and such a system can bring growth and profitability.
Next, the organization’s website can provide information regarding its position on business and society-related issues. To deal with these concerns, PetSmart has its own Ethics & Integrity Program that strengthens the corporation’s culture, workers, and customers, as well as brings navigation to effective decision-making when a business or social problems arise (“Compliance and Ethics,” n.d.). PetSmart finds such issues to be severe and never tolerates them.
Finally, as for the company’s official statements, they are quite positive and contain all the required information. In its mission statement, the corporation states that it aims at connecting people and pets and creating special moments for the former to inspire the latter (“About PetSmart,” n.d.). The company’s values are talent, culture, and community, and the vision is “the foundation of our diversity and inclusion efforts and guides what we do to make our good company great” (“Belonging at PetSmart,” n.d., para. 5). PetSmart has its Ethics & Integrity department that oversees the Code of Ethics & Integrity, while many other departments are also responsible for supporting ethics and morale. Overall, one can say that the corporation’s statements and attitudes towards responsibilities in the workplace are connected between each other and promote a positive environment.
PetSmart’s Key Stakeholders and Their ‘Stakes’
The purpose of this section is to list and discuss the main groups that are somehow interested in the development, growth, and success of PetSmart. As for every retailer, pet store chains have their own significant stakeholders, and they are not limited to employees, customers, and leadership. There are many more parties that either win or suffer when PetSmart becomes more productive and competitive. Thus, these stakeholders are PetSmart’s leaders and investors, managers and employees, current and potential buyers, suppliers, competitors, government, activists, and the community as a whole. What is more, considering the market in which the corporation under question operates, one may find it essential to name pets as the main stakeholders of PetSmart.
To begin with, it is evident that each of the identified groups is related to the operations and performance of the corporation, either directly or indirectly. Leaders and investors of PetSmart are interested in receiving good profit from the company, and they are also motivated by their sincere love for animals (“About PetSmart,” n.d.). Further, managers and employees value their company as an ethical, inclusive, diverse, and positive workplace where they can contribute to making pets and their owners happier. Additionally, since the staff members are offered job security, training programs, various bonuses, and payments, they are committed to performing their duties and strengthening the image of their organization.
Next, both current and potential customers are also interested in the development of PetSmart. While loyal clients get access to high-quality goods at competitive prices, potential buyers may need this access in future when other pet stores are not able to satisfy their needs. Eco-friendly products and welcoming workers are valued by people. Additionally, as the representatives of the local and national community, they need PetSmart because the latter promotes ethical treatment of animals and helps pets to become healthy and find a loving family (“About PetSmart,” n.d.). As a consequence, the significant and valuable impact of the corporation is undoubtful, meaning that the world would probably be slightly worse without PetSmart. The community should see PetSmart as the almost perfect example of how successful organizations have to encourage morale and sustainability, participate in voluntary and humanitarian activities, and perceive their work as a valuable process.
The reason above also relates to activists who need the company because it supports an extended number of animal protection and rescue programs. Humanitarian help after accidents and catastrophes saves the lives of numerous pets, and the efforts of activists become more effective (“PetSmart Sustainability,” 2022). Further, as for suppliers, they are interested in the growth of PetSmart because they need loyal, trustworthy, and influential partners. The corporation develops and expands, and the more it offers and sells to its clients, the more it orders from the suppliers. Next, the government can also be considered a stakeholder because the authorities should overview PetSmart’s operations and compliance with laws, requiring the company to maintain transparency, and guarantee cooperation and help when needed. In return, the organization contributes to strengthening the country’s economy. Competitors are stakeholders because they are materially affected by the successes and failures of the corporation under research. Finally, pets and street animals need PetSmart since the company improves their lives.
There are mutual effects between the identified groups and the organization. While the stakeholders, in many different ways, contribute to the development and effectiveness of PetSmart, the pet store chain plays significant roles in the lives or growth of the listed parties. Finally, the company’s stakeholder relationship efforts are quite efficient because PetSmart prepares numerous reports and announcements to describe its achievements, promotes itself via social media and its official website, and introduces numerous discounts and offers to attract customers.
Key Social Responsibility Activities and Programs of PetSmart
To begin with, it is possible to say that the company in question is rather ethical and good in corporate social responsibility. PetSmart is engaged with numerous activist programs, protects its workers and customers, tries to contribute to solving environmental issues, and has a philanthropic nature (Larkin, 2022). Indeed, according to the official website of the firm, as well as a vast number of credible sources, PetSmart plays a considerable role in making this world a better place, and it is not surprising since those who work with pets are usually CSR-friendly.
First of all, it is vital to notice that PetSmart has recently taken its engagement in addressing environmental, social, and governance (ESG) more seriously. According to Larkin (2022), the company created a new role of “VP of corporate social responsibility and sustainability” and appointed Joanne Dwyer, who is a specialist in this field (para. 1). In her interview, Dwyer noticed that “PetSmart has had a long-standing commitment to CSR and sustainability,” and now the organization wants the strategy to become more robust (Larkin, 2022, para. 3). Consequently, one may expect that PetSmart will soon take an even more active role in supporting people and environment.
One of the main initiatives of the organization is the creation of in-store adoption centers for homeless cats, dogs, and other animals. As stated by Kotler (n.d.), PetSmart allows local animal welfare organizations to keep stray animals in PetSmart stores, and while the employees take care of them, visitors can get both a pet and food and accessories required. As a result, the store chain receives a profit, people get themselves beautiful pets, and animal welfare organizations can reduce their costs.
Another valuable initiative is also related to making connections between humans and animals and allowing loving families to adopt pets and make them happy. PetSmart Charities is a non-profit organization and a part of PetSmart. According to the official website, the company supports pets and “their families through programs that work to make veterinary care more accessible, help battle food insecurity, and provide disaster response” (“About Us,” 2022, para. 5). Low-income persons can receive help when they cannot take care about their pets themselves, while homeless animals receive an opportunity to be safe, loved, happy, and, most importantly, alive. In 2022, the organization donated about $15 million to enhance low-income pet owners’ access to veterinary services. Indeed, all these actions, programs, and initiatives make it evident that PetSmart is one of the best in addressing the needs of the community.
Additionally, there is a side of the situation that is rarely taken into consideration – PetSmart and their initiatives help make sure that fewer animals live on the streets, spread disease, breed, and attack people. As a consequence, such a charity not only helps humans find pets but also keeps them all safer. Further, one may find it necessary to mention that the corporation celebrates National Adoption Week and offers people an invaluable opportunity. Thus, during this week, “potential pet parents will have the chance to interact with adoptable pets from animal welfare organizations facilitated by PetSmart Charities at local PetSmart stores” (PetSmart Charities, 2022, para. 3). This is an amazing chance for all interested persons to meet with pets and also learn about appropriate caring since employees and volunteers will educate visitors.
One would agree that these initiatives and programs are extremely valuable and effective, which is proved by statistics. For example, “since 1994, PetSmart has donated more than $52 million to animal welfare programs and saved lives of nearly 3.5 million animals” – these are rather impressive numbers (“PetSmart Sustainability,” 2022, para. 5). At the same time, it would probably be more effective for the company to make sure that their efforts are reported and communicated more so that people can always learn about them and participate in various activities and programs.
Business Ethics
In order for organizations to achieve success and be respected by both employees and customers, they are required to have appropriate business policies to address discrimination, bribery, corporate social responsibility, and other controversial and severe issues. Business ethics allows for the establishment and maintenance of high levels of trust between stakeholders and decreases the risks of mistakes and negative situations. Therefore, another vital part of a company’s CSR compliance review is to analyze whether its business activities are ethical. Referring to PetSmart, one may say that the corporation always does its best to ensure that all its operations and processes are ethical, any violations are investigated promptly, and employees act in accordance with the code of conduct.
As mentioned earlier, PetSmart actively promotes workplace diversity and inclusion, making its employees feel welcomed and the differences between them – celebrated. The principles of integrity, respect, care, and honesty are at the core of PetSmart. For example, in 2020, the corporation’s “Associate Assistance Foundation (PAAF) has impacted many associate lives by funding almost $500,000 to help fellow associate face the unexpected” (“Belonging at PetSmart,” n.d., para. 5). An extended number of training programs is available for every staff member, meaning that one of the principles PetSmart follows is the support of employee education and talent development. What is more, there are several workplace collectives and groups like MOSAIC, Pride at Work (PAW), Women Inspiring Strength & Excellence (W.I.S.E.), and others (“Belonging at PetSmart,” n.d.). They welcome employees, help them feel like they belong, and encourage everyone to be more tolerant and friendly.
PetSmart has a good and robust system to ensure that rules are followed. The corporation states: “the E&I department works collaboratively with other departments such as Human Resources, Internal Communications, and Training to ensure we provide awareness and training to emphasize compliance throughout our company” (“Compliance and Ethics,” n.d., para. 1). Any allegations are handled appropriately through the Ethics and Integrity Program, and PetSmart acts in accordance with morale even when it is inconvenient or challenging. Noticeably, the staff members are encouraged to “voice their concerns with their immediate supervisor, a higher level of management, Human Resources, the Ethics & Integrity department, or via the CareSmart hotline” (“Compliance and Ethics,” n.d., para. 3). The latter is administered by a third-party service, meaning that anonymity is guaranteed and secured.
At the same time, it is of vital importance to notice that PetSmart is a large company with thousands of employees, and some of them can act unethically or violate the corporation’s guidelines. PetSmart itself may fail to consider all the areas it has to control and make a mistake like the one discussed in previous sections. Despite the fact that it sells eco-friendly goods and buyers trust the competence of its employees, there was a public conflict when PetSmart and some other major pet store chains confused its clients (Johnson, 2021). What is more, some other activities of the corporation raise concerns. According to researchers, “while they promote the adoption of cats and dogs, they continue to sell other animals, like reptiles and amphibians, therefore becoming part of a cruel trade, causing severe suffering” (World Animal Protection, 2021, para. 2). Although PetSmart tries to achieve high morale and ethicality of all its operations, specific improvements are still required.
As for some partnerships and relations with other companies, attempts to find negative comments or articles about such relationships failed. PetSmart has business connections with both non-governmental and governmental organizations, and these relations only bring profit and benefit. For instance, PetSmart Charities partners with Family Promise, Canine Companions for Independence, and some other non-profit organizations to improve the world together, and there are many advantages from these partnerships (“National Partnerships,” n.d.). Finally, it also works with CDC to prevent the spread of diseases, and all these relationships are ethically based and value-oriented.
Globalization and Sustainability
It is essential to mention that PetSmart’s operations are designed in accordance with sustainability rules, and the company not only tries to contribute to solving global issues but also avoids deteriorating the general situation. Researchers indicate that PetSmart’s steps in the direction of environmental conservation are slow and strategic (“PetSmart Sustainability,” 2022). Since 2006, the company has run the ‘Recycle for Life’ program in order to collect donations for homeless pets’ welfare. Thus, “PetSmart Charities receive $2 -$15 donations for every ink cartridge or cell phone recycled through this program,” and “if anyone purchases recycled and refilled ink cartridges, it receives a $2-5 donation per piece sold (“PetSmart Sustainability,” 2022, para. 6). In addition, the company sells eco-friendly products, such as EcoTraction, GREENFIN, and Safe Paw (“PetSmart Sustainability,” 2022). These green products are safe and nutritious for pets and do not harm the environment.
PetSmart demonstrates its awareness about numerous tragic accidents and catastrophes that can take the lives of or hurt homeless animals or pets. Thus, since 2007, it has run the ‘Emergency Relief Waggin’ program (“PetSmart Sustainability,” 2022). As stated by researchers, PetSmart Charities take care of animals after various disasters. When a hurricane, tornado, flood, or a man-made disaster happens, the company’s vehicles are ready to provide “emergency pet supplies and field and support equipment valued at $60,000” (“PetSmart Sustainability,” 2022, para. 8). These supplies include some general animal-care items like litter pans, bowls, food, beds, and crates, as well as less common things, such as lights, battery chargers, tents, a generator, and fans. The latter items are valuable for the agency that cares about the animals.
In order to better evaluate the efforts and practices of PetSmart, one may find it effective to compare its sustainability strategy to its competitor. Overall, PetSmart and Petco are at the same level in their compliance to improving and saving the planet, having some similarities and differences in their focus. For instance, similar to PetSmart, Petco offers eco-friendly food, toys, and furniture to its customers, and in the next several years, the corporation plans to increase its sustainable goods assortment to 50% (Petco, 2022). When manufacturing its own brand’s goods, the company designs reusable packages, uses environmentally friendly ingredients, and adheres to cruelty-free standards. Moreover, Petco (2022) “installed energy management systems in 98% of Petco Pet Care Centers” and adopted some other practices to help the environment (para. 6). Overall, it is possible to conclude that both corporations put enormous and effective efforts in sustainability, but PetSmart is more oriented at donations, charity, and humanitarian help, while the actions of Petco are more practical.
Finally, it is crucial to explore how the company attempts to alleviate global business challenges. Since PetSmart operates in Canada, America, and Puerto Rico, the global business issues it faces may include cultural differences, brand consistency and localization, organizational communication, and human resources. Since the corporation is extremely competitive and successful, one may suggest that it perfectly manages these concerns. For instance, PetSmart provides substantial training programs to its employees, teaching them about cultural differences and communication with their foreign colleagues (“Compliance and Ethics,” n.d.). The best and most talented candidates are selected in each location, while communication between the international branches of the company is effective due to well-established channels. Finally, while PetSmart makes sure that every facility follows the features of the brand, goods, products, and services are still localized to the needs and demands of local customers.
Conclusion
To draw a conclusion, one may say that a vast number of retailers should pay increased attention to the practices, policies, and initiatives of PetSmart and consider this corporation to be an example of a sustainable and ethical firm. Although not all operations are perfect, and PetSmart still needs to address several disadvantages and concerns it has, the contribution of this organization cannot be overestimated. Unfortunately, many business leaders only focus on getting a profit, but PetSmart’s leadership, first and foremost, makes a huge contribution to the fight against environmental problems and human cruelty and indifference. This corporation adheres to the code of ethics and conduct, has positive and beneficial relationships with all partners, and creates additional initiatives to support pets, humans, and the planet. As a consequence, when it manages to address the remaining concerns in its approach, PetSmart will become even more competitive. Even though the industry as a whole still faces some issues, this pet store chain has the chance to overcome them and contribute greatly to raising awareness of the need for corporate social responsibility and moral actions.
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