By LAUREN HOLLINGSWORTH

Contributing Reporter

Outsiders may look at Sharon Graner's Kennel Club and conclude that she has cleverly exploited a market niche upscale boarding for cats and dogs.

After all, there are plenty of places where people can room and board their pets for $5 or $10 a night. But how many offer services like the Kennel Club including pet massages, private "cottages," a swimming pool, TV, even ice cream and cookies?

Yet according to Graner, her decision to focus on luxury pet services wasn't based on any market analysis, formal or informal. "My goal (was) to give the animals what they need," said Graner. "The money will follow."

Graner opened her original Kennel Club in Torrance in 1983, with a staff of seven and $300,000 in revenues that first year. Last year, Graner said she generated $1.3 million and now employs 35 people.

Graner, 44, founded the business after her divorce 17 years ago. She had previously worked with her ex-husband in real estate, and when they separated she needed to find other employment.

Since Graner had majored in animal science at Cal Poly Pomona, she decided she should do what she loved best work with animals.

"I should have probably written him a thank you note," says Graner of her ex-husband, "because (the divorce) caused me to do what I wanted to do. My true love and passion has always been animals."

Graner teamed up with another woman, and the two of them went to several banks seeking loans, but they were turned down everywhere in part, Graner believes, because they were women. Eventually, Republic Bank California agreed to lend them $300,000.

The two partners were able to pay back the loan within two years. Graner attributes her initial success to good marketing she invited groomers, veterinarians and pet-store owners to see the facility. From those sessions, referrals began coming in.

The partners opened the airport-area Kennel Club in 1990. Two years later, Graner and her partner split, with Graner taking over the airport office.

It was after she began operating on her own that Graner began focusing on providing special services, including individual cottages. The Kennel Club also has a special air circulation system that recycles air 12 to 15 times an hour to keep viral diseases and animal smells to a minimum.

An average of 150 animals are handled a day, with weekends and summer months being the busiest times. Prices for a dog range from $16 a day for a 1- to 30-pound dog, to $50 a day for VIP service. For cats, the range is $12 to $30 for a VIK or "very important kitty" condo.

Clients are paying for the attention to detail. Dog "cottages," for example, are really small rooms that surround an interior courtyard. Each one is themed differently: Dalmatian firehouse, cowboy dog and the beach house.

Each also is equipped with a TV and VCR that plays movies like "101 Dalmatians" and "Lady and the Tramp." Every afternoon the doors are opened so that the dogs can come into the courtyard and congregate around a park bench reserved for "story hour."

If owners choose to purchase VIP status, their pet will stay in a private room, equipped with a full-sized bed, stove, television and VCR.

But are such luxuries really necessary?

"They're important for the people. It's not important for the animals," says Rose Richards, manager of Soft Touch Pet Lodge in Torrance.

At Soft Touch, quartering a small dog costs $8 a night and a large one costs $12. Cats can stay for $7 a night. Although Soft Touch doesn't provide a pool or massage, the dogs have runs so they can get their exercise.

Clients of the Kennel Club say the extra money is worth it.

"They reassure the owners as much as the animals," said Kennel Club client Ruby Weissman. "The atmosphere when you walk in, the friendliness of the employees, the cleanliness I've been boarding my dog there for four years and she loves it. I love to spoil my dog."

For Graner, offering swimming and TV in a kennel is no different than what people offer their pets at home. Graner also believes that careful monitoring of the animals' health encourages customers to keep coming back. Dogs are weighed daily to monitor weight loss or gain, and chicken and rice is mixed into the food to ensure regular meals.

Most of Graner's employees are in their late teens and early 20s. "I worked with vets for years," says Ellen Forbes, a manager at the Kennel Club, "but you get burned out. Here there's more of a long-term relationship you can build with the animals, especially the shy dogs. I seem to work well with them."

Employees refer to the animals by name and some pets are regulars. One dog spends about half a year at The Kennel Club. His owner is an actor, and the dog was unhappy going on location with him. Graner says he is more comfortable in a familiar place.

"Just going to a party, you tell people (what you do) and some of them are just hysterical," says Graner. "But people love their pets so they feel safe knowing that the people here are nutty about animals."

The Kennel Club

Year Founded: 1983

Core Business: Short and long-term kennel service for animals.

Revenues in 1983: $300,000

Revenues in 1997: $1.3 million

Employees in 1983: 7

Employees in 1998: 25-30

Goal: To provide more and better services for Kennel Club customers.

Driving Force: Animals need high-quality care in an increasingly travel-friendly world.

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