Tractor Supply Closes Acquisition of Allivet, a Leading Online Pet and Animal Pharmacy

Rhea-AI Summary

Tractor Supply Company (NASDAQ: TSCO) has completed its acquisition of Allivet, a leading online pet pharmacy licensed in all 50 states. The acquisition expands TSCO's total addressable market by $15 billion to $225 billion and provides a $1 billion revenue opportunity at full scale.

Allivet, founded in 1992, operates three distribution centers offering next-day delivery to most of the U.S. The platform provides brand-name medications, pharmacy advice, and auto-ship programs. This acquisition will enable TSCO to offer pet and animal prescription services to its 37 million Neighbor's Club members. Financial terms were not disclosed.

Positive

• Expands addressable market by $15 billion to $225 billion
• Provides $1 billion revenue opportunity at full scale
• Gains access to licensed pharmacy operations in all 50 states
• Adds three distribution centers with next-day delivery capability
• Extends services to 37 million existing Neighbor's Club members

Negative

• None.

Insights

Financial Analyst

The acquisition of Allivet marks a strategic expansion into the lucrative pet pharmacy market, adding $15 billion to TSCO's total addressable market (TAM), now reaching $225 billion. With a projected $1 billion revenue opportunity at full scale, this represents significant growth potential. The deal strengthens TSCO's competitive position against major pet retailers like Chewy and PetMed Express. The acquisition provides immediate access to nationwide pharmacy infrastructure with 3 distribution centers and next-day delivery capabilities. Particularly valuable is Allivet's auto-ship subscription model, which typically generates higher customer lifetime value and predictable recurring revenue. The integration with TSCO's 37 million Neighbor's Club members creates substantial cross-selling opportunities and potential margin expansion through operational synergies.

Market Research Analyst

This acquisition is perfectly timed to capitalize on two major market trends: the rapid growth of pet healthcare spending and the shift toward online prescription fulfillment. The pet pharmacy sector has shown resilient growth, even during economic downturns, as pet owners increasingly view animal healthcare as non-discretionary spending. Allivet's established presence in all 50 states and its regulatory compliance infrastructure provide TSCO immediate scale advantages that would have taken years to build organically. The deal enhances TSCO's omnichannel strategy by adding a specialized e-commerce capability that complements its extensive physical footprint of 2,270 stores. This positions TSCO to better compete in the rapidly growing online pet pharmacy segment while leveraging its existing customer relationships.

Tech Expert

Allivet's proven e-commerce platform and prescription management system represent significant technological assets for TSCO. The integration potential with TSCO's existing digital infrastructure could create a seamless omnichannel experience, particularly valuable for the Neighbor's Club loyalty program. The three distribution centers are strategically positioned for next-day delivery coverage, suggesting sophisticated logistics technology and inventory management systems. The auto-ship program's technology stack likely includes advanced predictive analytics for inventory forecasting and customer behavior modeling. While financial terms weren't disclosed, the technology acquisition alone could justify a significant portion of the purchase price given the complexity of building compliant pharmacy systems and the time-to-market advantage it provides.

Acquisition expands retailer’s addressable market by $15 billion; Provides $1 billion revenue opportunity at full scale

BRENTWOOD, Tenn.--(BUSINESS WIRE)-- Tractor Supply Company (NASDAQ: TSCO), the largest rural lifestyle retailer in the United States, announced today that it has completed its acquisition of Allivet, a privately-held online pet pharmacy. The plans to acquire Allivet were previously announced on October 24, 2024.

“We’re very excited to officially welcome the Allivet team to the Tractor Supply family,” said Hal Lawton, president and chief executive officer of Tractor Supply. “This acquisition complements and expands our existing ‘Life Out Here’ product and services line-up. We look forward to providing our 37 million Neighbor's Club members with a value-oriented pet and animal prescription service and introducing Tractor Supply to Allivet's customers."

The acquisition of Allivet expands the company’s total addressable market by $15 billion to $225 billion.

Since its founding in 1992, Allivet has grown to be a leading online pet and animal pharmacy fully licensed in all 50 states with three distribution centers that allow it to efficiently serve the needs of its customers and reach a large majority of the U.S. with next day delivery. Allivet has a proven platform to make pet parenting easier by providing convenient access to brand-name medications, expert pharmacy advice and automatic delivery with its auto-ship program.

Financial terms of the acquisition were not disclosed.

About Tractor Supply Company

For more than 85 years, Tractor Supply Company (NASDAQ: TSCO) has been passionate about serving the needs of recreational farmers, ranchers, homeowners, gardeners, pet enthusiasts and all those who enjoy living Life Out Here. Tractor Supply is the largest rural lifestyle retailer in the U.S., ranking 293 on the Fortune 500. The Company’s more than 50,000 Team Members are known for delivering legendary service and helping customers pursue their passions, whether that means being closer to the land, taking care of animals or living a hands-on, DIY lifestyle. In store and online, Tractor Supply provides what customers need – anytime, anywhere, any way they choose at the low prices they deserve.

As of September 28, 2024, the Company operated 2,270 Tractor Supply stores in 49 states. For more information on Tractor Supply, visit www.tractorsupply.com.

Tractor Supply Company also owns and operates Petsense by Tractor Supply, a small-box pet specialty supply retailer providing products and services for pet owners. As of September 28, 2024, the Company operated 205 Petsense by Tractor Supply stores in 23 states. For more information on Petsense by Tractor Supply, visit www.Petsense.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241230386281/en/

Tricia Whittemore (615) 440-4410

Mary Winn Pilkington (615) 440-4212

corporatecommunications@tractorsupply.com

Source: Tractor Supply Company

FAQ

How much will the Allivet acquisition expand TSCO's addressable market?

The Allivet acquisition expands Tractor Supply's total addressable market by $15 billion to $225 billion.

What is the revenue potential of TSCO's Allivet acquisition at full scale?

The Allivet acquisition provides a $1 billion revenue opportunity for Tractor Supply when operating at full scale.

How many distribution centers does Allivet bring to TSCO's operations?

Allivet brings three distribution centers to Tractor Supply's operations, enabling next-day delivery to a majority of the U.S.

When was the Allivet acquisition by TSCO first announced?

Tractor Supply announced its plans to acquire Allivet on October 24, 2024.

How many Neighbor's Club members will have access to Allivet's services?

37 million Neighbor's Club members will have access to Allivet's pet and animal prescription services.