Rancho Santa Margarita company’s pet food that’s fit for humans thrives in a growing industry

Breann Shook had her dog, Lucy, for 11 years before she decided to look into what was really going into her pet’s food.

Her English cocker spaniel had developed serious allergies and refused to eat most of what Shook put in front of her. Shook finally found some freeze-dried liver that Lucy liked, but when she read the labels on the back, she was horrified.

“All over the packaging, it said, ‘Not for human consumption. Wash hands after touching,’” she said. “It just looked really scary — the fact that we could be giving her something that almost seemed toxic.”

So Shook started cooking Lucy’s meals in her own kitchen — what she saw as the only safe and healthy way to feed her dog.

She quickly realized that other pet owners were doing the same and saw an opening in the market for high-quality, handmade, human-grade pet food. So Shook and her husband, Eric, launched Grandma Lucy’s Freeze-Dried Pet Food and Treats in 1999.

The Rancho Santa Margarita-based company is now part of a growing $20 billion pet food industry whose expansion over the past decade is almost entirely fueled by high-end brands.

Mirroring the foodie movement among people, pet owners are increasingly concerned about what goes into their animals’ meals, with 79% saying that the quality of their pet’s food is as important to them as their own, according to the marketing research firm Euromonitor.

Grandma Lucy’s set itself up as an alternative to mass-produced, highly processed kibble, which is made of feed-grade meats deemed unfit for human consumption.

The 25-employee company instead uses only human-grade meats, vegetables, fruits and grains, and prepares all meals by hand in its kitchen. The dishes — which include chicken, lamb, pork, venison, bison, Mahi, rabbit, goat, a variety aimed at allergy-prone dogs — are then freeze-dried on-site to ensure long shelf lives — without adding preservatives.

Grandma Lucy’s boasts that people can eat it too. Shook has tried many of the rehydrated meats herself — the cheeseburger meatball is her favorite — and explained that many of the recipes are similar to what you’d find in a cookbook.

“The pot roast has ground beef, rice flour, potatoes, celery and garlic,” Shook said. “The cheeseburgers are ground beef, cheese, garlic and tomato sauce. They taste good. The smells you get around here are great.”

Grandma Lucy’s oven-baked, 100% USDA organic cookies — which come in flavors such as pumpkin, blueberry and apple — are also a hit, said Uriel Chavez, manager of Healthy Spot pet store in Costa Mesa.

“We have people who eat them because they’re actually that good,” he said. “So people come in for a bag for themselves and one for their dog.”

Shook said her business was fueled by the wave of pet food recalls in 2007, which exposed the lack of safety in more than 90 popular brands.

“That had people in a panic and really made them question where their pet food was being made,” said Shook. “A big thing in the pet industry right now is trust. People have trusted our company for a long time. We haven’t had any recalls on any of our products.”

Indeed, DogFoodAdvisor, a popular website, gives Grandma Lucy’s products 4.5 and 5 stars — out of a possible 5.

This trust comes at a premium price point. A 3-pound bag of the artisan chicken variety — which makes 14 pounds of fresh food after rehydration — costs $30, while a 10-pound bag of rabbit or goat — which becomes 50 pounds of food — costs $100.

A 45-pound bag of Kibbles’n’Bits costs $23 at Walmart.

Many are willing to pay. In 2014, Americans spent $58.04 billion on their pets, according to the American Pet Products Assn., and this year, are expected to fork over $60.59 billion — $23.04 billion of that on food.

This spending has been on the rise over the past decade, when in 2005, Americans spent just $36.3 billion on the pet industry.

Much of this industry growth can be attributed to the growing popularity of high-end pet food. According to Euromonitor, the market for pet food has increased more than 75% since 2000, with nearly all of the growth coming from the “premium” sector.

Shook said that Grandma Lucy’s has seen double-digit sales growth every year.

While Orange County is Grandma Lucy’s biggest market — “people like that we’re local,” said Shook — the company sells to 5,000 small and independent pet stores across the United States and Canada, and now exports to Singapore, Hong Kong and Taiwan.

Not all veterinary experts, however, are sold on the premium pet food sector.

Cailin Heinze, a board certified veterinary nutritionist and assistant professor of clinical nutrition service at Tufts School of Veterinary Medicine, doesn’t believe the hype, pointing out that there is no legal definition for what “human-grade” pet food even means.

“There’s no proof that it’s any healthier than conventional diets that are a heck of a lot less expensive,” she said. “It’s basically marketing.

“A lot of pet owners seem to think that if you feed your pet human food, they’re magically safe, but human food gets recalled for bacterial contamination all the time. There is absolutely nothing wrong with feeding your pets the traditional type of diets that are out there, canned and dried, made from reputable manufacturers.”

She added: “We inflict our human and moral values on the food that we feed our pets, which isn’t always appropriate.”

While Shook knows that there will always be skeptics, she said the market for her products is only growing.

“There are still those people who will feed kibble and don’t care — it’s just a dog,” said Shook. “But there are a lot more people that aren’t having kids, that are having kids later in life, so their pets are more of a family member than ever before. They want food that would be similar to what they would eat, or even better.”