Strategy

Winning new customers

Musti Group is well positioned to continue our track record of winning new customers from the large and growing Nordic pool of 5.8 million dogs and cats.

Success in new customer acquisition is a key driver of continued market share gain across our Nordic markets. Acquisition of puppies and kittens is especially important from a lifetime value perspective. This is supported by our concept, our leading brand awareness, and customer focus. The underlying pet parenting trend, favoring Musti Group’s concept, continues strong.

The number of loyal customers, Friends of Musti, increased by 6.1% to 1,543 thousand across the Nordic countries.

Grow share of wallet

Growing the share of wallet within our base of loyal customers is a clear opportunity for Musti Group. To deepen the engagement of our customers, Musti is developing an ecosystem approach for Nordic pet parents with an ‘All you need is Musti’ mentality across the pet lifecycle. Supported by data we are able to customize our value proposition to individual needs of Nordic pets and their parents.

Rolling 12 months average spend per loyal customer increased to EUR 209,1 in financial year 2024 (EUR 206,4 on 30 September 2023), despite unfavorable currency exchange rate effects.

Expand store network and number of service points

Musti expanded its operations to the Baltics by acquiring Pet City OÜ (including its subsidiaries Pet City UAB, Pet City SIA, and Pet City Klinika UAB) as well as Eesti Veterinaaria Kliinikum OÜ in November 2024. Pet City operates 46 stores and 16 veterinary clinics across the Baltic countries, along with a region-wide e-commerce platform.

In addition, we continue to open new stores to attract new customers with a strong concept and seamless customer experience that encourage switching to Musti Group. This is further supported by our comprehensive online store, which accounted for 24.3% (23.0%) of the Group’s total revenue.

Musti Group has the widest geographical presence in the Nordic region. Our growth investments are expected to generate long-term benefits, with the number of stores increasing from 231 at the end of financial year 2020 to 415 by the end of financial year 2024. In addition to expanding our store network, Musti Group has also invested in growing its range of services.

Focusing on driving gross margins through increased O&E share and leveraging scale

A core element of Musti Group’s strategy is developing the offering of own and exclusive products sold only in Musti Group’s channels. This comes with three main benefits of the uniqueness of our offering, loyalty especially in food and other consumable categories, and higher gross margin profile.

Musti Group has strong historical track record in driving gross margin improvement. Own and exclusive brands are a cornerstone of our high gross margins as these brands typically carry 10–15%-points higher margins compared to global brands. In financial year 2024, gross margin decreased to 44.1% (45.7%) mainly due to weak overall consumer demand, investments in pricing and promotional activities, and the impact of inflation.

Share of sales of own and exclusive brands continued stable at 51.4% (52.4%) during the year.

Leveraging broadly invested platform to drive operating leverage and scale benefits

Significant investments to Musti Group’s IT, digital platforms, warehouse and production facility are expected to drive increased operating leverage and scale benefits to further increase Musti Group’s profitability as topline growth is expected to continue while fixed costs may be spread across larger net sales.