Article & Images Provided by: The Austin Business Journal
Many retailers and would-be retailers have struggled to find suitable space in Austin for new and expanding businesses with vacancy rates in the single digits and rents skyrocketing. But a Houston-based pet food purveyor has had great success finding affordable options in Central Texas.
Natural Pawz opened a store in Round Rock in September and will debut its second location in January in Steiner Ranch. A third store will open near Lakeline Mall in February or March.
The search, said Natural Pawz cofounder Biff Picone, has actually been easier here than in Houston.
"Of course if you want to locate in downtown Austin, that's crazy, and new construction is more expensive," Picone said. "We know that we just can't go into certain areas."
Picone and his wife, Nadine Joli-Coeur, were veteran tech employees with Hewlett-Packard Co. and Samsung Corp. when they decided to head down a completely new career path.
"My wife came home one day and said, 'We're going to open a pet store,'" Picone said. "We had a love for pets and a dog with allergies."
The couple created Natural Pawz in 2005 for a select demographic: picky pet owners.
They don't compete with PetSmart, discount stores or grocery chains. They offer pet foods that they've personally researched.
"We tour every manufacturing facility and learn how their food is produced," Picone said.
In addition to natural pet foods, Natural Pawz sells other natural pet supplies, cleaning products, holistic herbs and health supplements. They also partner with rescue organizations on pet adoptions.
Natural Pawz has 16 locations in Houston and about 110 employees.
Expansion to Austin is due in large part to support from Houston landlords, who have properties in Austin, and Houston customers who have friends in Austin.
"Our customers in Houston always told us, 'You have to open a store in Austin. They're dog crazy over there,'" Picone said.
So when Regency Centers Corp., a Houston landlord, urged Natural Pawz to open a store in one of their Round Rock properties, the decision was pretty simple.
"We do a lot of analysis with local people," Picone said.
He's also very conservative, refusing to pay more than 7 percent of his monthly revenues for monthly rent. Picone knows he needs a space that's at least 1,400 square feet but not larger than 2,100 square feet.
Mature neighborhood centers anchored by grocery stores are the sweet spot.
About three years ago, Picone and his wife came up with a prototype design, which carries over to every location.
"We've adapted a cookie cutter design that is functional. We want people to have the same kind of feeling in all of our stores," he said.
Even though design matters, Picone said Natural Pawz spends about one-third what other retailers spend on average for build-out.
Picone aims to open between three and five Natural Pawz stores in 2016.
The company has never sought investors, preferring to self-fund and pour revenue back into the business.
"We make less money than when we were in high tech, but we've been profitable," Picone said.
Here's a list of Natural Pawz's Austin stores:
- 110 N. I-35 in Round Rock, opened in September 2015
- 5145 N. RR 620 in Steiner Ranch, opening Jan. 9, 2016
- 1530 Cypress Creek Road in Cedar Park, opening in spring 2016