Petco to stock fewer pets; PETA claims victory

NEW YORK (Reuters) - Petco Animal Supplies Inc, the second-largest U.S. pet retailer, said its stores will carry 30 percent fewer animals overall by the summer, as better customer-tracking systems allow it to devote more space to products.

People for Ethical Treatment of Animals (PETA) contended the change was prompted by its probe, which "uncovered abuse and neglect of birds and animals" at one of Petco's suppliers.

Daphna Nachminovitch, vice president of cruelty investigations at the animal rights group, said Petco had agreed to reduce its pet inventory "to better monitor the quality of care animals would get at its facilities," if the group refrained from attacking the retailer in public.

Petco spokesman Kevin Whalen said: "What we had agreed to with PETA was to accelerate this plan, as well as to revamp and upgrade animal supplier certification standards, as a result of what PETA shared with us."

Whalen said the plan was actually based on the results of a market test begun in November 2007, and is partly the result of having more sophisticated customer-tracking systems.

"As we looked at the results over the last three to four months, we decided to extend the program across all stores over the coming months," he said.

Petco is still laying out detailed plans, and will complete the change "probably sometime this summer," Whalen added.

"What we're trying to do is make sure we have the more popular animals where they will sell more quickly," he said. "How can you sell as many if you have fewer in less space? It's making sure animals in the stores are the right ones customers want."

A very small number among Petco's 850 U.S. stores, however, may carry more pets, Whalen said. What products take over space previously devoted to pets will depend on the store, he added.

"One of the things we talk about is trying to be the neighborhood pet store. It implies having the selection of products (customers) want rather than what we think they should have," Whalen said.

Petco's most popular products include food for cats and dogs. Its innovative offerings include automated kitty litter boxes, seasonal apparel for dogs, and beds for small animals.

PETCO SUPPLIER ABUSES

PETA said it found a Petco supplier, Rainbow World Exotics in Hamilton, Texas, abusing animals in surprise visits from September to November last year.

For example, PETA said, rabbits were neutered using a dull razor; live hamsters, rats and mice were dumped in trash cans; and animals were thrown to the floor in attempts to kill them.

In response, Petco suspended Rainbow, conducted its own surprise inspection, and Rainbow has completed improvements to its facilities, Whalen said.

"Based on their performance over the last month and their continued interest in working with us to improve protocols, we reinstated them as a supplier," he added.

PETA and other animal rights groups frequently urge pet stores to stop selling animals, and encourage aspiring pet owners to adopt from animal shelters instead.

But retailers note consumers prefer pets from stores they know, over adopting or buying from dealers they don't know.

San Diego, California-based Petco and rival Petsmart Inc (PETM.O) support separate pet adoption programs.

Petco was bought by private equity firms Texas Pacific Group TPG.UL and Leonard Green & Partners in 2006. Petsmart, based in Phoenix, has 993 stores in the United States and Canada.

(Editing by Braden Reddall)