How to Start a Kennel

People adore their pets, but they’re often unable to bring them on vacation. That’s where kennels come in, which these days are almost like hotels for pets and make up an $8 billion US industry. If you love animals, you could start your own kennel, even a small one in your own home, and make good money while taking care of people’s cuddly cuties. 

But starting a successful business requires a great deal of planning and preparation. Fortunately, this step-by-step guide lays out all you need to know and walks you through the process of starting a kennel from beginning to end.

Step 1: Decide if the Business Is Right for You

Pros and cons

Starting a kennel has pros and cons to consider before deciding if it’s right for you.

Kennel industry trends

Industry size and growth

• Industry size and past growth – The US pet grooming and boarding industry was worth a strong $8 billion in 2021. The industry has grown nearly 1% annually for the last five years in spite of a large dip during the pandemic.((https://www.ibisworld.com/united-states/market-research-reports/pet-grooming-boarding-industry/))
• Growth forecast – The global pet services market is projected to grow 6% annually through 2027.
• Number of businesses – In 2021, 130,838 pet grooming and boarding businesses were operating in the US.
• Number of people employed – In 2021, US pet grooming and boarding businesses employed 231,928 people.

Trends and challenges

Trends in the kennel industry include:

• Pet daycare is in greater demand, offering a huge opportunity for kennels to have regular revenue rather than periodic overnight boardings.
• Spa-like services for pets, such as shampoos and grooming, are increasingly popular, offering an opportunity for kennels to add significant revenue. 

Challenges in the kennel industry include:

• Aggressive dogs and other animals can present a safety challenge.
• Pet safety and animal health must be a priority as a pet owner can hold the kennel liable if a pet is injured or gets sick.

Demand hotspots

• Most popular states – The most popular states for kennels are Michigan, Connecticut, and New York.((https://www.zippia.com/kennel-assistant-jobs/best-states/))
• Least popular states – The least popular states for kennels are New Mexico, Arkansas, and Louisiana.

What kind of people work in kennels?

• Gender –  70.1% of kennel workers are female, while 26% are male.((https://www.zippia.com/kennel-worker-jobs/demographics/))
• Average level of education – The average kennel worker is high school educated.
• Average age – The average kennel worker in the US is 32.5 years old.

How much does it cost to start a kennel business?

Startup costs for a kennel range from $3,500 for a home kennel to $14,000 for a physical location. Costs include crates and other equipment as well as a deposit on a kennel space on the high end. 

You will also need to get a kennel license for your kennel and pet boarding business. Requirements vary by state, and licenses usually need to be renewed annually.  

You’ll need a handful of items to successfully launch your kennel business, including: 

• Crates
• Food bowls
• Blankets
• Leashes

Start-up Costs	Ballpark Range	Average
Setting up a business name and corporation	$150 - $200	$175
Business licenses and permits	$100 - $300	$200
Insurance	$100-$300	$200
Business cards and brochures	$200 - $300	$250
Website setup	$1,000 - $3,000	$2,000
Location rental	$0 - $5,000	$2,500
Crates and other supplies	$2,000 - $5,000	$3,500
Total	$3,550 - $14,100	$8,825

How much can you earn from a kennel business?

The average price of a kennel is $50 per day. If you start the kennel in your home, your profit margin should be about 90%.

In your first year or two, you could work from home with 6 crates and fill each crate for 3 days a week, bringing in $46,800 in annual revenue. This would mean $42,000 in profit, assuming that 90% margin. As your brand gains recognition and you get repeat customers, you’d rent a commercial space and hire staff, reducing your profit margin to around 20%. If you can fill 25 crates 6 days per week, you’d have annual revenue of $390,000, and you’d make a tidy profit of $78,000.

What barriers to entry are there?

There are a few barriers to entry for a kennel. Your biggest challenges will be:

• The startup costs to rent a space and purchase equipment
• Competition from established kennels

Step 2: Hone Your Idea

Now that you know what’s involved in starting a kennel, it’s a good idea to hone your concept in preparation to enter a competitive market. 

Market research will give you the upper hand, even if you’re already positive that you have a perfect product or service. Conducting market research is important, because it can help you understand your customers better, who your competitors are, and your business landscape.

Why? Identify an opportunity

Research kennels in your area to examine their services, price points, and customer reviews. You’re looking for a market gap to fill. For instance, maybe the local market is missing a kennel that also offers grooming and training.

This could jumpstart your word-of-mouth marketing and attract clients right away. 

What? Determine your products or services

In addition to boarding services you could offer:

• Pet bathing
• Pet grooming
• Training
• Pet spa services

How much should you charge for pet boarding?

The average price for pet boarding is $50 per day. Once you have a physical location, your expenses will be rent, overhead, and labor. You should aim for a profit margin of at least 20%.

Once you know your costs, you can use this Step By Step profit margin calculator to determine your mark-up and final price points. Remember, the prices you use at launch should be subject to change if warranted by the market.

Who? Identify your target market

Your target market will be pet owners, which is broad. You should spread out your marketing to include sites like TikTok, Instagram, Facebook, and LinkedIn. You could also distribute flyers at pet stores and veterinary offices.

Where? Choose your kennel location

In the early stages, you may want to run your business from home to keep costs low. But as your business grows, you’ll likely need to hire workers for various roles and may need to rent out a kennel space.

Depending on the type of kennel services you plan to offer, you may also want to consider the proximity to residential areas or parks. Find commercial space to rent in your area on sites such as Craigslist, Crexi, and Instant Offices.

When choosing a commercial space, you may want to follow these rules of thumb:

• Central location accessible via public transport
• Ventilated and spacious, with good natural light
• Flexible lease that can be extended as your business grows
• Ready-to-use space with no major renovations or repairs needed

Step 3: Brainstorm a Kennel Name

Your business name is your business identity, so choose one that encapsulates your objectives, services, and mission in just a few words. You probably want a name that’s short and easy to remember, since much of your business, and your initial business in particular, will come from word-of-mouth referrals.

Here are some ideas for brainstorming your business name:

• Short, unique, and catchy names tend to stand out
• Names that are easy to say and spell tend to do better 
• Name should be relevant to your product or service offerings
• Ask around — family, friends, colleagues, social media — for suggestions
• Including keywords, such as “kennel” or “pet boarding”, boosts SEO
• Name should allow for expansion, for ex: “Playful Pooch Kennels” over “Medical Care Kennels”
• Avoid location-based names that might hinder future expansion
• Use online tools like the Step by Step Business Name Generator. Just type in a few keywords and hit “generate” and you’ll have dozens of suggestions at your fingertips.

Once you’ve got a list of potential names, visit the website of the US Patent and Trademark Office to make sure they are available for registration and check the availability of related domain names using our Domain Name Search tool. Using “.com” or “.org” sharply increases credibility, so it’s best to focus on these. 

Finally, make your choice among the names that pass this screening and go ahead with domain registration and social media account creation. Your business name is one of the key differentiators that sets your business apart. Once you pick your company name, and start with the branding, it is hard to change the business name. Therefore, it’s important to carefully consider your choice before you start a business entity.

Step 4: Create a Kennel Business Plan

Every business needs a plan. This will function as a guidebook to take your startup through the launch process and maintain focus on your key goals. A business plan also enables potential partners and investors to better understand your company and its vision:

• Executive Summary: A concise summary of the entire business plan, highlighting key points and objectives.
• Business Overview: A brief introduction to the kennel business, its mission, and the problem it aims to solve.
• Product and Services: Details about the specific services offered, such as pet boarding, grooming, and training.
• Market Analysis: Examination of the target market, its size, demographics, and trends in the pet care industry.
• Competitive Analysis: Assessment of competitors in the local area, their strengths, weaknesses, and how your kennel will stand out.
• Sales and Marketing: Strategies for promoting the kennel, acquiring customers, and generating revenue.
• Management Team: Profiles of key team members and their roles in running the kennel.
• Operations Plan: Information on day-to-day operations, including location, facilities, staffing, and processes.
• Financial Plan: Projections of financial statements, including income, expenses, and funding requirements.
• Appendix: Supplementary materials, such as resumes, market research data, or additional documents that support the business plan.

If you’ve never created a business plan, it can be an intimidating task. You might consider hiring a business plan specialist to create a top-notch business plan for you.

Step 5: Register Your Business

Plus, registration is exciting because it makes the entire process official. Once it’s complete, you’ll have your own business! 

Choose where to register your company

Your business location is important because it can affect taxes, legal requirements, and revenue. Most people will register their business in the state where they live, but if you’re planning to expand, you might consider looking elsewhere, as some states could offer real advantages when it comes to kennels. 

If you’re willing to move, you could really maximize your business! Keep in mind, it’s relatively easy to transfer your business to another state. 

Choose your business structure

Business entities come in several varieties, each with its pros and cons. The legal structure you choose for your kennel will shape your taxes, personal liability, and business registration requirements, so choose wisely. 

Here are the main options:

• Sole Proprietorship – The most common structure for small businesses makes no legal distinction between company and owner. All income goes to the owner, who’s also liable for any debts, losses, or liabilities incurred by the business. The owner pays taxes on business income on his or her personal tax return.
• General Partnership – Similar to a sole proprietorship, but for two or more people. Again, owners keep the profits and are liable for losses. The partners pay taxes on their share of business income on their personal tax returns.
• Limited Liability Company (LLC) – Combines the characteristics of corporations with those of sole proprietorships or partnerships. Again, the owners are not personally liable for debts.
• C Corp – Under this structure, the business is a distinct legal entity and the owner or owners are not personally liable for its debts. Owners take profits through shareholder dividends, rather than directly. The corporation pays taxes, and owners pay taxes on their dividends, which is sometimes referred to as double taxation.
• S Corp – An S-Corporation refers to the tax classification of the business but is not a business entity. An S-Corp can be either a corporation or an LLC, which just need to elect to be an S-Corp for tax status. In an S-Corp, income is passed through directly to shareholders, who pay taxes on their share of business income on their personal tax returns.

We recommend that new business owners choose LLC as it offers liability protection and pass-through taxation while being simpler to form than a corporation. You can form an LLC in as little as five minutes using an online LLC formation service. They will check that your business name is available before filing, submit your articles of organization, and answer any questions you might have.

Step 6: Register for Taxes

The final step before you’re able to pay taxes is getting an Employer Identification Number, or EIN. You can file for your EIN online or by mail or fax: visit the IRS website to learn more. Keep in mind, if you’ve chosen to be a sole proprietorship you can simply use your social security number as your EIN. 

Once you have your EIN, you’ll need to choose your tax year. Financially speaking, your business will operate in a calendar year (January–December) or a fiscal year, a 12-month period that can start in any month. This will determine your tax cycle, while your business structure will determine which taxes you’ll pay.

It is important to consult an accountant or other professional to help you with your taxes to ensure you’re completing them correctly.

Step 7: Fund your Business

Securing financing is your next step and there are plenty of ways to raise capital:

• Bank loans: This is the most common method but getting approved requires a rock-solid business plan and strong credit history.
• SBA-guaranteed loans: The Small Business Administration can act as guarantor, helping gain that elusive bank approval via an SBA-guaranteed loan.
• Government grants: A handful of financial assistance programs help fund entrepreneurs. Visit Grants.gov to learn which might work for you.
• Friends and Family: Reach out to friends and family to provide a business loan or investment in your concept. It’s a good idea to have legal advice when doing so because SEC regulations apply.
• Crowdfunding: Websites like Kickstarter and Indiegogo offer an increasingly popular low-risk option, in which donors fund your vision. Entrepreneurial crowdfunding sites like Fundable and WeFunder enable multiple investors to fund your business.
• Personal: Self-fund your business via your savings or the sale of property or other assets.

Bank and SBA loans are probably the best option, other than friends and family, for funding a kennel business. You might also try crowdfunding if you have an innovative concept. 

Step 8: Apply for Kennel Business Licenses and Permits

Starting a kennel business requires obtaining a number of licenses and permits from local, state, and federal governments.

You will also need to get a kennel license for your kennel and pet boarding business. Requirements vary by state, and licenses usually need to be renewed annually.  

Federal regulations, licenses, and permits associated with starting your business include doing business as (DBA), health licenses and permits from the Occupational Safety and Health Administration (OSHA), trademarks, copyrights, patents, and other intellectual properties, as well as industry-specific licenses and permits. 

You may also need state-level and local county or city-based licenses and permits. The license requirements and how to obtain them vary, so check the websites of your state, city, and county governments or contact the appropriate person to learn more. 

You could also check this SBA guide for your state’s requirements, but we recommend using MyCorporation’s Business License Compliance Package. They will research the exact forms you need for your business and state and provide them to ensure you’re fully compliant.

If you feel overwhelmed by this step or don’t know how to begin, it might be a good idea to hire a professional to help you check all the legal boxes.

Step 9: Open a Business Bank Account

Before you start making money, you’ll need a place to keep it, and that requires opening a bank account.

Keeping your business finances separate from your personal account makes it easy to file taxes and track your company’s income, so it’s worth doing even if you’re running your kennel business as a sole proprietorship. Opening a business bank account is quite simple, and similar to opening a personal one. Most major banks offer accounts tailored for businesses — just inquire at your preferred bank to learn about their rates and features.

Banks vary in terms of offerings, so it’s a good idea to examine your options and select the best plan for you. Once you choose your bank, bring in your EIN (or Social Security Number if you decide on a sole proprietorship), articles of incorporation, and other legal documents and open your new account. 

Step 10: Get Business Insurance

Business insurance is an area that often gets overlooked yet it can be vital to your success as an entrepreneur. Insurance protects you from unexpected events that can have a devastating impact on your business.

Here are some types of insurance to consider:

• General liability: The most comprehensive type of insurance, acting as a catch-all for many business elements that require coverage. If you get just one kind of insurance, this is it. It even protects against bodily injury and property damage.
• Business Property: Provides coverage for your equipment and supplies.
• Equipment Breakdown Insurance: Covers the cost of replacing or repairing equipment that has broken due to mechanical issues.
• Worker’s compensation: Provides compensation to employees injured on the job.
• Property: Covers your physical space, whether it is a cart, storefront, or office.
• Commercial auto: Protection for your company-owned vehicle.
• Professional liability: Protects against claims from a client who says they suffered a loss due to an error or omission in your work.
• Business owner’s policy (BOP): This is an insurance plan that acts as an all-in-one insurance policy, a combination of the above insurance types.

Step 11: Prepare to Launch

As opening day nears, prepare for launch by reviewing and improving some key elements of your business. 

Essential software and tools

Being an entrepreneur often means wearing many hats, from marketing to sales to accounting, which can be overwhelming. Fortunately, many websites and digital tools are available to help simplify many business tasks. 

You may want to use industry-specific software, such as Easy Busy Pets, Kennel Link, or PAWFINITY, to manage your bookings, service packages, inventory, invoicing, and payments.

Accounting

• Popular web-based accounting programs for smaller businesses include Quickbooks, Freshbooks, and Xero. 
• If you’re unfamiliar with basic accounting, you may want to hire a professional, especially as you begin. The consequences for filing incorrect tax documents can be harsh, so accuracy is crucial. 

Develop your website

Website development is crucial because your site is your online presence and needs to convince prospective clients of your expertise and professionalism.

You can create your own website using website builders. This route is very affordable, but figuring out how to build a website can be time-consuming. If you lack tech-savvy, you can hire a web designer or developer to create a custom website for your business.

They are unlikely to find your website, however, unless you follow Search Engine Optimization (SEO) practices. These are steps that help pages rank higher in the results of top search engines like Google. 

Marketing

For your kennel business, the marketing strategy should focus on showcasing the quality of care, comfort, and safety you provide for pets. Emphasize your commitment to animal well-being, the expertise of your staff, and the range of services you offer, such as grooming, training, or specialized care for pets with specific needs. Here are some powerful marketing strategies for your future business:

Kickstart Marketing

• Professional Branding: Your branding should convey trustworthiness, care, and a pet-friendly atmosphere. This includes a memorable logo, business cards, and a welcoming design for your facility.
• Direct Outreach: Network with local veterinarians, pet stores, and pet clubs to introduce your services. Offer referral discounts or partnerships to build relationships.

Digital Presence and Online Marketing

• Professional Website and SEO: Develop a website that outlines your services, pricing, and facilities. Use SEO best practices to rank for local searches related to pet boarding, dog kennels, and pet care services.
• Social Media Engagement: Utilize platforms like Facebook and Instagram to share photos and videos of pets enjoying their stay, customer testimonials, and information about your services.

Content Marketing and Engagement

• Pet Care Blog: Share informative content about pet care, boarding tips, and pet health. This helps position your business as a knowledgeable authority in pet care.
• Email Newsletters: Keep your clients informed about any new services, seasonal pet care tips, and special offers.
• Video Tours: Create videos that provide virtual tours of your facility, showcasing the space, amenities, and the care pets receive.

Experiential and In-Person Engagements

• Open House Events: Host open house events where potential clients can tour your facility, meet the staff, and learn about your services.
• Participation in Community Events: Engage in local pet-related events, fairs, and shows to increase visibility and connect with potential clients.

Collaborations and Community

• Partnerships with Pet-Related Businesses: Collaborate with pet groomers, trainers, and local pet shops for cross-promotion and referral incentives.
• Community Involvement: Participate in or sponsor community events, pet adoption days, and local animal charities to build goodwill and brand recognition.

Customer Relationship and Loyalty Programs

• Loyalty Rewards Program: Implement a program offering discounts or special services to repeat customers.
• Referral Incentives: Encourage word-of-mouth marketing by offering discounts or added services for clients who refer new customers.

Promotions and Advertising

• Targeted Local Advertising: Use local newspapers, pet magazines, community bulletin boards, and online platforms to reach pet owners in your area.
• Special Offers and Packages: Create special offers for holidays, multi-pet families, or extended stays to attract customers.

Focus on USPs

Unique selling propositions, or USPs, are the characteristics of a product or service that sets it apart from the competition. Customers today are inundated with buying options, so you’ll have a real advantage if they are able to quickly grasp how your kennel meets their needs or wishes. It’s wise to do all you can to ensure your USPs stand out on your website and in your marketing and promotional materials, stimulating buyer desire. 

Global pizza chain Domino’s is renowned for its USP: “Hot pizza in 30 minutes or less, guaranteed.” Signature USPs for your kennel business could be:

• A luxury hotel for your pets
• At-home loving kennel care
• Your babies will be our babies while you’re away

Networking

You may not like to network or use personal connections for business gain. But your personal and professional networks likely offer considerable untapped business potential. Maybe that Facebook friend you met in college is now running a kennel business, or a LinkedIn contact of yours is connected to dozens of potential clients. Maybe your cousin or neighbor has been working in kennels for years and can offer invaluable insight and industry connections. 

The possibilities are endless, so it’s a good idea to review your personal and professional networks and reach out to those with possible links to or interest in kennels. You’ll probably generate new customers or find companies with which you could establish a partnership. 

Step 12: Build Your Team

If you’re starting out small from a home kennel, you may not need any employees. But as your business grows, you will likely need workers to fill various roles. Potential positions for a kennel business include:

• Kennel Workers – help care for pets
• General Manager – scheduling, staff management, accounting
• Marketing Lead – SEO strategies, social media

At some point, you may need to hire all of these positions or simply a few, depending on the size and needs of your business. You might also hire multiple workers for a single role or a single worker for multiple roles, again depending on need. 

Free-of-charge methods to recruit employees include posting ads on popular platforms such as LinkedIn, Facebook, or Jobs.com. You might also consider a premium recruitment option, such as advertising on Indeed, Glassdoor, or ZipRecruiter. Further, if you have the resources, you could consider hiring a recruitment agency to help you find talent. 

Step 13: Run a Kennel – Start Making Money!

When people travel, they can’t always take their pets with them, but they want them to be cared for in a comfortable setting. You can help by starting your own kennel, and you can even have it in your home in the beginning. You just need a love of animals, some crates and supplies, and you can tap into an $8 billion industry. 

You’ve got the business basics down now, so it’s time to get your plan together and start building your kennel empire!