How Much Should You Charge for a Pet License?

How Much Should You Charge for a Pet License?

How Much Should You Charge for a Pet License?

There are many things to consider when deciding how much to charge for a good or service,  including:

  • the cost of production,
  • market standards,
  • and value to the consumer.

When determining how much to charge for a pet license, the most common method used by Pet Licensing Organizations across North America is to determine market standards by analyzing the prices of similar and surrounding jurisdictions.

In late 2017 we conducted a North America-wide study of the Pet Licensing Industry and did exactly that. We compiled data on over 600 pet licensing programs to obtain regional averages regarding a variety of program attributes. We believe this data is useful to help PLOs assess how their program compares to national, and state/provincial averages. As part of this work, we aimed to better understand the prices pet licensing organizations charge pet owners in their communities.

Below you can see the state/provincial average dog license prices of the states/provinces for which data was obtained on at least 10 pet licensing programs.

Average Dog License Prices By State/Province Across North America

One major trend that can be observed in the data collected is that generally, pet license prices are higher in the Western States and Provinces of North America.  Below you can see a chart depicting the average dog license prices by region.

Average Dog License Prices By Region Across North America

So, How Can This Help You Determine Your Jurisdiction's License Price?

As mentioned before, knowing the cost of production and the value to the consumer are both integral parts of setting your license price. However, determining how your licensing price compares to state/provincial averages can be an extremely useful tool in assessing your fee schedule.

By using the regional average pet owners will be familiar with your fee schedule and already expecting a price point around that average. Therefore, pet owners will have a higher willingness to pay the license fee, knowing that the market is sitting at the equilibrium price.

It should be noted, however, that having a licensing fee schedule above your regional average is not necessarily detrimental to the willingness to pay of pet owners. One of the major considerations that has historically gone into setting prices is whether or not the cost or discounts will have a positive effect on increasing sales. It is typical for Pet Licensing Organizations to attempt to raise license sales through amnesty programs or heavy discounting when compliance is low.

However,  through our research, we also collected data regarding the fee structure of each municipality and saw a positive correlation between higher licensing fees and higher compliance rates. To expand further, for municipalities that we found to have less than a 20% compliance rate, the average license fee for an altered dog is $15.60. Conversely, for municipalities that we found to have greater than a 20% compliance rate, the average license fee for an altered dog is $20.10. Therefore, if you have found that your fee structure is sitting above the regional average it is unlikely that any form of discount will impact the compliance in your jurisdiction long term. Keep in mind what motivates a buyer: cost vs. value. If the pet owner gets value from their license, the cost is trivial.

So, thinking about adjusting your fees? Consider matching your new fee schedule to regional averages to manage pet owner expectations (but keep your financial goals in mind as you do).  Implementing a proper costing analysis is essential to managing a successful pet licensing program but try to keep your prices in conjunction with the market trends.

Thinking of Raising Your Fee Schedule?

Learn more about how DocuPet can help you create a comprehensive pet licensing strategy.