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Yes, the microchip needle is rather large, however I have seen most pets chipped with little or no reaction. They almost act like they can hardly feel it. I think it has a lot to do with the location that the chip is placed, where a lot of extra loose skin is.
I think that pet's that won't wear a collar should all be chipped, unless of course they are strictly indoors or have no chance/desire to escape.
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