While pet owners struggle to pay for veterinary care, they’re still managing — more or less — to pay for pet food, doggie day care and other pet items and services.

The American Pet Products Association, which tracks industry trends, estimates Americans will spend a record $50.8 billion on pets this year, compared with $48.4 billion last year.

And Portland is no exception. The local pet industry continues to thrive, but some businesses have had to adjust to meet their clients’ changing needs.

Business is booming at Stay Pet Hotel, where owner Kim Hormby added a new facility in 2009. The Northeast Portland dog boarding hotel opened at the end of 2006 and quickly outgrew its 17 suites.

The business has experienced a growth rate of more than 200 percent since 2007 and projects another 19 percent growth this year over last.

Though Hormby did see some decline in business travel in 2009, people still took vacations, even if the destinations became closer or cheaper.

“We still had people boarding their dog, but there were a lot of people going to Mexico rather than to Hawaii,” she says.

At LexiDog Boutique & Social Club, “business is really unpredictable,” owner Suzanne Hein says.

Hein opened in 2002 — she remembers being the third doggie day care in Portland — and now operates her signature doggie day care/boutique combination in three locations.

Business had been sporadic and inconsistent since fall 2008, when many clients cut back on doggie day care after losing a job, she says.

“But the interesting thing is that day care didn’t cut off completely,” Hein says. “People see it as a necessity for their dog versus a fun thing.”

More and more customers switched from purchasing 12- or eight-day packages (priced at $285 and $190, respectively) to paying $26.50 for one day. About 30 percent of clients pay by the day.

At Dogstar Daycare, “We’ve been very touched by the recession,” says owner Theresa Shire, who says last year was her worst since opening six years ago.

Shire also attributes this largely to a decline in business travel. Many of the Pearl District business’s clients are professionals who work at corporations.

Dogstar responded by offering a Groupon and a First Thursday special: free daycare from 6 to 9 p.m.

Increased competition also makes it tougher to vie for new customers, she says.

Hein’s theory is that new doggie day cares continue to open because people who have lost jobs turn to the pet industry as a safe bet.

One part of Shire’s business that is doing well is her adoption program. In 2009, she started a pet rescue, bringing in cats and dogs from small area shelters, which she says is doing “phenomenally.”

Luxury items less hot

In the boutique portion of LexiDog, “We literally had to completely re-sort our store,” Hein says. “The high-end luxury things just weren’t desirable all of a sudden.”

For example, the cashmere dog sweater someone might have dropped $125 on three years ago might be replaced with a $60 wool sweater.

Vendors who refused to adjust their prices with the changing economy have vanished, she says.

Furever Pets on Northeast Broadway similarly scaled back on high-end items, still offering quality products but with lower prices, says owner Symon Lee.

The store also cut back on overtime, tries not to overstock and has scaled back on accessories.

At Pets on Broadway, the first six months of the recession were the toughest, but business has been steady over the past year, says purchasing manager Chelsea Schuyler.

“The biggest trend we’ve noticed is anything very high-priced that’s not a necessity has disappeared,” she says.

Not surprisingly, the $180 litter boxes flopped, as did the $170 waste-disposal systems and the fancy coat lines.

Pet food a top seller

Where people don’t seem to be scrimping is in the pet food aisle. Bags of high-quality kibble such as Orijen still fly off the shelves at $80 a bag, Schuyler says.

“People with pets are starting to get more educated about pet food,” says Nancy Fedelem, owner of Salty’s Dog & Cat Shop on North Mississippi Avenue. “They’re taking better care of their pets. A lot of times it takes your vet costs down.”

Dog and cat food and treats make up the bulk of Salty’s sales, which could explain why her sales have grown by about 10 percent each year.

Fedelem opened six years ago, but demand forced her to expand from a 450-square-foot shop to a 1,200-square-foot space in February 2010, hiring four additional employees.

But many Portland pet owners are still struggling, a fact evidenced by the 624 percent increase in demand for Cat Adoption Team’s Cat Food Bank in the past two years. The Cat Food Bank distributes more than 3,000 pounds of cat food each month, while The Pongo Fund has donated nearly 2 million pet food meals as it approaches its two-year anniversary.

Still, it’s probably safe to say Portland is one place where pet owners with any money to spare probably will continue to spend it on their pets, no matter how tough things get.

“I think the pet industry is always going to do just fine,” Furever Pets’ Lee says. “If you don’t make any big mistakes, you will probably do just fine.”

– Monique Balas