As living standards continue to rise, the pet economy has emerged as a sunrise industry, forming an increasingly comprehensive industrial chain. From pet food to full-lifecycle services—including healthcare, grooming, and even insurance for accidents and illnesses—pets are now enjoying premium care.
A recent visit to the Pet Products Industry Chain Incubation Base in Caoxian County, Shandong Province, revealed how the county has leveraged its traditional industries to pivot toward the pet economy. Through policy guidance, technological innovation, and industrial integration, Caoxian has successfully transformed its conventional economic sectors into modern, specialized industries.
Under the coordination of the county’s United Front Work Department and the Federation of Industry and Commerce, traditional industries such as timber processing, agricultural product processing, and garment manufacturing have been revitalized. The pet economy alone is projected to exceed 2.6 billion yuan in output value by 2025.
**Precision Expansion of the Industrial Chain** **Four Key Sectors in the Pet Economy**
According to officials, Caoxian has strategically extended its industrial chain by tapping into traditional sectors, achieving breakthroughs in both scale and output.
1. **Pet Housing & Accessories** The incubation base has guided local woodcraft enterprises to shift toward high-value pet products like cat trees and smart pet houses. In 2024, the base offered over 500 pet-related products—ranging from habitats and health care items to interactive toys—exported to more than 20 countries. The sector’s output reached 1.77 billion yuan, accounting for 66.8% of the county’s pet industry.
Notable companies include Penghui Crafts Co., which invested in an 11-member R&D team and achieved 28 million yuan in output in 2024, and Haina Crafts Co., which partnered with Alibaba International and Amazon to generate 19 million yuan. Zhengda Crafts Co. surpassed 50 million yuan after transitioning into pet products.
2. **Pet Apparel** Leveraging its existing garment industry, Caoxian expanded into pet fashion, quickly gaining market traction via e-commerce. Haizhou Garments produced 10,000 pet outfits in 2024, with sales surging 400% in early 2025. Yueyang Garments Co. also secured OEM orders for pet clothing.
3. **Pet Services** With a pet population of around 170,000, the county has fostered diverse service demands. Over 260 mid-to-high-end pet salons now offer grooming, styling, and wellness services. The rabies vaccine market alone holds a potential value exceeding 10 million yuan.
4. **Pet Food** The incubation base integrated agricultural processing resources to introduce dedicated pet food production lines, focusing on premium and functional products. The sector’s 2024 output hit 860 million yuan, with eight industrial enterprises—four of which exceeded 50 million yuan in revenue.
Key players include Paison Pet Food Co. (298 million yuan output), Zhongyu Pet Food Co. (136 million yuan, up 101%), and Kaifanle Pet Food Co. (208 million yuan), which operates a German-made extrusion line and an in-house WMS system.
**Government Support & Industrial Synergy**
To bolster the pet industry, local authorities have implemented supportive policies, fostering deep integration between traditional sectors and the pet economy.
- **R&D & Innovation**: Companies like Paison Pet Food invested 10.72 million yuan (3.6% of revenue) in R&D, developing functional wet food with probiotics and fish oil. Zhongyu Pet Food pioneered "low-temperature freshness-locking" technology for senior pet nutrition. - **Market Expansion**: The county organized trade fairs in cities like Shenyang and Shanghai to reduce reliance on Western markets. - **Logistics & Financing**: Fast-track approvals, low-interest loans, and land supply priority were offered to scaling enterprises.
The Caoxian Federation of Industry and Commerce also established a Pet Economy Industry Alliance, coordinating government agencies, financial institutions, and research bodies to nurture the sector as a new engine for regional growth.
**Branding & Cluster Development**
By clustering pet food and housing manufacturers in key towns like Qingguji and Zhuangzhai, Caoxian has enhanced industrial synergy. Companies are encouraged to build proprietary brands—Penghui Crafts launched an overseas brand, while Haina Crafts secured long-term e-commerce partnerships.
"Caoxian’s success lies in integrating resources, policy guidance, innovation, and cluster development," officials noted. The model offers a replicable pathway for regional economic transformation.
(Photo) The Pet Products Incubation Base in Caoxian showcases a variety of pet services.
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