Hounded by a weak economy, a luxury kennel owner digs up clients with promotions and day-care services.
In recent years, business had gone to the dogs. But that was good for Auntie Ruth's Animal Care and Wellness Center, a luxury kennel in Minnetonka.
Nowadays, however, many of the dogs are just plain gone.
For a large, labor-intensive operation with space for 165 dogs and 35 cats, that's a problem. Recession-wary pet owners are traveling less and as a result are boarding their pets less often and for shorter stays, said owner Ruth Murman, the "auntie" at Auntie Ruth's.
Bookings began to slow last summer as gasoline prices soared, Murman said. And the trend continued as the economy sputtered.
"Just like the restaurants, the hotels and the airlines: whatever percentage they're down, we're down," she said. "If people don't travel they don't bring me their dogs."
Murman, who built her business largely through client and vet referrals, has responded by stepping up advertising and promotions.
"We didn't used to have to advertise," she said. "It was all word of mouth. Now we're implementing more programs."
One new offer is a free first day of boarding or day care. Another is free sample bags of pet treats, with coupons for owners to use on return visits.
"To have the staff here, we need to charge what we're charging," Murman said. "So it's a little difficult to be giving things away, but we're doing what we have to do."
The base rate for boarding dogs is $45 a day, she said. That includes playtimes in a large indoor playroom or outdoors as well as spoon-feeding and other extras for which some competitors charge extra.
Murman is trying to get through the slowdown without laying off any of her 30 employees, although she recently posted a notice offering unpaid time off to any who were interested.
A few months ago, in response to the dropoff in bookings, Auntie Ruth's began offering a new service: weekend day care. It's catching on as an alternative to boarding dogs for the weekend or finding someone to watch them during an extended outing, such as going to a wedding or the lake.
Back to the future
Today's tough times remind Murman of the post- 9/11 downturn that struck just a few months after she opened. At the time, it was one of the first luxury kennels in the Twin Cities metro area and likely the first to offer convalescent care to aging, post surgical and special-needs pets, some of them rescued.
Murman had spent $750,000 -- raised from investors and a Small Business Administration loan -- to build space for reception, retail, kennels, grooming, playrooms, exam rooms and convalescent care on two floors of a former lighting showroom.
One response then was to add day care on weekdays, something customers had asked for but Murman had resisted providing.
"We had no business," Murman said, recalling the time after the 2001 terrorist attacks. "People wanted us to do day care and we said OK. It has always pulled us along and helped us."
Getting back on her feet may have been easier then, Murman said, because she had fewer competitors. More luxury kennels have opened, and now some big-box pet stores have begun offering boarding, joining mom-and-pop operations and vet-run kennels.
While Auntie Ruth's draws clients from around the metro area, most of them are from closer-in western suburbs.
Molly Joseph said she and her family's two dogs are happy with the service at Auntie Ruth's. "The staff there, they really care about the animals. ... They have this whole other side to them that is animal-focused, and you see that in the care they give their customers' pets."
Anne Barasch, a board member of the Minnesota Humane Society, said Murman has taken in a number of rescued animal from the society.
"If I were a dog or a cat and had to be away from home, that's where I'd want to go," Barasch said.
Murman hopes to open another location for perhaps 75 dogs to expand her reach but has put those plans on hold until after the economy recovers.
Murman grew up taking care of animals, including strays that sometimes were hurt or became sick. Her affinity for animals, and the credit-card bills she rang up getting them treated, in part led to her becoming a veterinary technician and later an entrepreneur.
Dogs boarded at Auntie Ruth's sometimes are reluctant to leave, Murman said. They enjoy extended trips to the 40-by-40-foot playroom on the main floor.
Downstairs, the 4-by-8-foot runs are bigger than is typical elsewhere, Murman said. The dogs get clean bedding twice a day, and their feed dishes go through a commercial dishwasher.
For cats, there's a playroom with a wall-to-wall aquarium and lots of climbing structures.
If an animal gets sick or hurt, Murman tries to get it to its regular veterinarian, although she has one on call around the clock.
The expert says: David Deeds, Schulze chair in entrepreneurship at the University of St. Thomas Opus College of Business, said Murman's new promotions and services are good moves in this economy.
"You've got to find a way to develop new demand to replace the declining demand ... to a get a little more out of your customers," Deeds said. "The other thing is figuring out [how to] lower the cost to the customer without substantially lowering the price. The day care is an example. It may be lower revenue [than overnight boarding] but hopefully a higher-margin service."
Business owners also have to pay attention to their costs and cash flow and must be prepared to adjust quickly, Deeds said.
"When demand is low you have to manage the costs down to meet the current demand," Deeds said. "You can't be too altruistic. Maybe you have to share the pain, cutting hours across the board vs. letting somebody go. ... If you hold on too long and you don't manage that cost structure, everybody in the business loses."