A Journey in the Pet Industry; The Dragon Behind the Glass; SpaceWaves
The Fish Shed:
A Journey in the Pet Industry
By Kellen Betts in Manifold
After turning onto the rough dirt road I survey the empty plastic bucket jostling in the passenger seat and wonder how I am going to prevent water from sloshing out on the way home. It is a cloudy fall afternoon in the Pacific Northwest—dark enough that I had to turn on my headlights to navigate the deep potholes in the road. To my left is a large yard with unkept vegetation and a deteriorating shed. To my right is a dense grove of classic Northwest forest—nearly pitch black in the fading afternoon light.
Further up the road I turn off into another large yard. The property has been cleared of most vegetation except for a few large Douglas Fir trees. I park in front of the main house sitting next to a large shed. As I pull up a light turns on by the front door and a man emerges waving me over to the shed. A feeling of excitement and apprehension washes over me as I grab my wallet and bucket—my dealer has just received a new shipment from Malaysia.
Humans have kept exotic animals since we began congregating in urban environments. Mesopotamian Kings had elaborate gardens called paradeisoi, which later served as a model for the Garden of Eden. The Greeks brought back wild animals from military expeditions. Private “cabinets of curiosity” were invented during the Renaissance. Goldfish were kept as pets in China as early as the 10th century. By the 19th century, delicate plants were kept in glass tanks called Wardian cases. 
Today, pets are a $200 billion global industry. In the U.S., there are more exotic animals living in homes than in zoos, by some estimates. A majority of U.S. households have a pet: over 63 million are home to a dog, 42 million to a cat, and 11 million to a freshwater fish.  By number of individual animals, there are far more fish—more than 100 million—circling glass tanks in the U.S. than any other type of pet. And while the sale of live animals is worth over $10 billion annually in the U.S., the sale of pet food and supplies is far more lucrative.
Dog owners spend on average over $250 on food and $50 on toys each year. The pioneers of the pet supply business in the U.S., however, were bird dealers. They introduced the first packaged, commercial foods and medicines made specifically for pets in the 1840s. Modern pet shops first appeared in the 1890s. The industry grew rapidly following World War II, and has tripled since the 1970s with the introduction of “big box” retail chains in the 1980s. PetSmart and PETCO are the largest chains in North America with over 3,000 stores and $10 billion in annual sales between the two. [3,4]
Pet supplies has grown to be an important segment in e-commerce as well. Sumit Singh, the CEO of Chewy, rose to the ranks of the most highly paid executives in the U.S. this year, earning $108.2 million in salary, bonus, and stock grants. Chewy was founded by Ryan Cohen and Michael Day in 2011. Three short years later the company was posting monthly sales of over $10 million. PetSmart bought the company for $3.35 billion in 2017, and then took the Chewy brand public in 2019 at a valuation of over $8 billion. Like many e-commerce companies, however, Chewy has yet to post a profitable quarter. 
For many years I have tended to a menagerie of terrestrial plants, aquatic plants, tropical fish and other creatures in my home. One aquarium that has been a fixture in my living room for almost a decade was meant to be a “Nature Aquarium.” These are freshwater aquariums that contain live plants and fish assembled into beautiful aquascapes that resemble real natural environments. After years of struggling with persistent algae and uncooperative plants, I narrowed my goals for the tank to focus on a single fish—the discus. With vivid colors and intricate patterns, discus have been called the “King of the Aquarium.”
Discus are a freshwater species native to the Amazon River in South America. Most discus in the aquarium trade are raised in large fish farms in Southeast Asia. The dealer I have purchased most of my discus from imports them to the U.S. from Malaysia, and then ships them in insulated boxes to customers all over the U.S. Shipping a box full of water and live fish is not cheap, so he allows some customers to pick up their order.
The fish shed is a modest structure likely meant to serve as a typical household storage space or perhaps a small garage. This shed has been retrofitted with three narrow rows of wooden shelves full of glass aquariums. The space is warm, humid, and dimly lit. It is like a sauna turned into a hall of mirrors with continuous buzzing and gurgling sounds.
Discus are shy fish. Their slender shape allows them to hide in dense vegetation where they raise their fry away from the jaws of piranhas, arowanas, and other Amazonian predators. Farm-raised discus, however, know the routine. When the lights go on and a human enters their shed, it means one of two things: it’s time to eat or evade the blue net.
On a typical day the blue net starts the next leg of their global journey where they hitch a ride on FedEx trucks and planes to places like North Dakota and Arizona—strange places for a shy Amazonian fish to be sure. Today, the blue net is a ride to my white bucket, which I buckle into the passenger seat like I would any other passenger.
On the way home I cringe as water sloshes with every bump in the road. And yet these fish have sloshed around in plastic bags and buckets for most of their journey. They are true global travelers having ridden on more airplanes and trucks than many humans. For the pet industry though, today is just the beginning, the beginning of a lifetime—which for a discus might be 10 years—of fish food, high-tech filters, and other supplies for my new pet.
What We're Reading
Home Depot to Buy Former Unit HD Supply for $8.7 Billion by Colin Kellaher in The Wall Street Journal
Electric Aviation Could Be Closer Than You Think by Tammy Ma in Scientific American
Inside Amazon’s Trucking Ambitions by Paris Martineau in The Information
Amazon Wants to Make Your Drugstore Obsolete by Max Nisen in Bloomberg Opinion
The pros and cons of 'supply chain finance' by Jenny Wiggins in The Australian Financial Review
Book of the Week
Review by Kellen Betts
The arowana is a slender, bony fish native to rivers and lakes throughout Southeast Asia and South America. First introduced to the aquarium trade in the 1970s, arowana have become one of the most popular species in the hobby.
In The Dragon Behind the Glass (Scribner, 2016), Emily Voigt takes us on a fascinating journey in the ornamental-fish trade and her quest to see the rare Asian arowana in the wild.
Asian arowana reproduce slowly. By the 1990s, exploitation for food and the aquarium trade decimated wild populations and they were listed as a threatened species by the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES).
Some rare animals are like diamonds though. Limited supply increases their value and creates a feedback loop that has driven many species to extinction. CITES designation of the Asian arowana turned them into one of the most coveted and exclusive fish in the hobby. It also created a black market with tales of smuggling and armed robberies.
The picture that gradually emerged, however, looked less like the illegal drug trade and more like a parody of Manhattan’s overheated art scene, complete with record-breaking prices, anonymous buyers, stolen specimens, unsavory dealers, and even clever fakes. Whatever the best metaphor, it seemed the Asian arowana had a long history of driving human beings to dangerous extremes.
Young Professional Mixer
How Supply Chain Helps Reduce Hunger and Food Waste
November 24 @ 5:00 PM - 6:30 PM | Virtual | Free | CSCMP Puget Sound
As Thanksgiving approaches, it is important to recognize the nonprofits that work with farmers, truckers, volunteers and others to bring hunger relief to communities in need.
Join Seattle’s Council of Supply Chain Management Professionals (CSCMP) Young Professionals (YP) for a happy hour discussion with Harvest Against Hunger Executive Director David Bobanick. Learn about initiatives in food donations and navigating the complexities of temperature and time-sensitive food logistics. Following the presentation, we will have an open discussion, virtual games, and networking. See you there!
December 3, 2020 | Virtual | Free | FreightWaves
Put on by FreightWaves, SpaceWaves is sure to be a unique experience. Featuring experts from NASA, venture capital and tech startups, the event will explore the intersection of supply chains and space technology. What will change when cargo rockets can transfer freight across the globe in a matter of hours or even minutes instead of months or weeks? What will the Earth to moon to Mars supply chains look like and what can we be doing today to prepare ourselves?
By the Numbers
We received some promising news from the coronavirus vaccine trials recently. This week Moderna announced their vaccine is over 90% effective. It can be stored at standard refrigeration temperatures (2-8°C) for up to 30 days, and standard freezer temperatures (-20°C) for up to 6 months. This means the vaccine is compatible with existing cold-chain logistics infrastructure. 
Kellen Betts is Co-Editor of Supply Chain Weekly. He also writes the newsletter Manifold, exploring the intersection of supply chain, sustainability, and technology. Contact him at firstname.lastname@example.org. Follow him on LinkedIn, Twitter, GitHub, and The StoryGraph.
Miguel Garcia Gonzalez, CPIM is Co-Editor of Supply Chain Weekly. He sources technology at Amazon and leads the Discord Supply Chain server on logistics, procurement, certifications, news, and more. Contact him at email@example.com. Follow him on LinkedIn and @mggSCM.
 Voigt, Emily (2016). The Dragon Behind the Glass. New York: Scribner.
 APPA (2020). Pet Industry Market Size & Ownership Statistics. American Pet Products Association.
 Grier, Katherine C. (2006). Pets in America: a History. Chapel Hill: University of North Carolina Press.
 Statista (2020). Pets & Animal Supplies: Statistics and Facts on Pets & Animal Supplies.
 Melin, Anders, and Bryan Gruley (November 18, 2020). Who’s a Very Good Pandemic Business? Chewy Is. Oh, Yes It Is. Bloomberg Businessweek.
 Leonard, Matt (November 16, 2020). Moderna's coronavirus vaccine presents fewer cold chain hurdles than Pfizer. Supply Chain Dive.