Have a wonderful Christmas with your family and friends
Revenue for Vet Practices on the Upswing
More than 50 percent of veterinary practices have seen revenue growth this year compared with the year-ago period, according to the National Commission on Veterinary Economic Issues. Another 12 percent showed no growth, while about 33 percent to 35 percent saw revenue declines.
The nonprofit organization gathered the statistics on its website by asking veterinary practices how their clinic’s quarter one and quarter two revenues in 2010 compared with 2009.
In related news, the average practice has a profit margin of 9.8 percent with the median being slightly higher at 10.2 percent, according to results from the NCVEI/VetPartners Profitability Estimator.
NCVEI puts this into perspective: a practice needs to have a profit margin of 18 percent or higher to sell at the gold standard of 100 percent of gross revenue.
NCVEI also asked veterinary practices about fee increases. The survey found that 18.1 percent of veterinary practices have not raised fees in 2010, 1.4 percent lowered fees, 45.8 percent raised fees on average from 1 percent to 4 percent, 29.2 percent raised fees on average from 5 percent to 8 percent, 4.2 percent raised fees on average from 9 percent to 12 percent and 1.4 percent raised fees on average greater than 12 percent.
You can click here to visit the Veterinary Practice News website
VPMA Congress 2011 – Leading the way in Practice Management
The VPMA Annual Congress, now in its 17th year is established as the event in the veterinary calendar for practice managers, owners and practice staff.
The 2011 Congress has been re-vamped to give you a ‘better than ever’ programme of top quality management CPD in a dedicated, relaxed, professional environment away from the hustle and bustle of practice.
The congress programme has been expanded to provide three packed streams with something for everyone, whether you’re new to practice management or thinking about ‘setting up’, or an established owner or practice manager wanting to access the very latest information on running or promoting your practice.
There’s also a stream dedicated to ‘focusing on you’, so that you can at last grab that window of time to give some thought to your own personal and professional development.
Venue & accommodation
In 2011 we’re pleased to be hosting the congress in a new central location with specific conferencing facilities and accommodation on site. The Chesford Grange Hotel, Kenilworth, near Warwick, is an extended, four-star deluxe manor house set in 17 acres of private grounds with dedicated modern conferencing facilities and health and leisure club.
You can click here to visit the VPMA website for further information and to register
Business news, perspectives & trends from VetPartners
Reaching out to specific clients increases impact over general marketing.
Practice marketing efforts that are directed to specific client groups are more effective than those that attempt to “get our name out there” to nobody in particular. In all cases, clients better relate to efforts directed to their specific needs. Clients can be segmented by breed of pet, health issues, pet’s age, client demographics and other variables. What is the best way to segment a practice’s client base? How can practices develop more meaningf marketing efforts that will hit clients’ “hot buttons”? Veterinary marketing expert Linda Wasche can answer these questions and more.
Profitability/quality of management remain at decade low at many veterinary practices.
Data from the NCVEI/VetPartners 2009 Profitability Estimator indicate the profitability of the average practice is low. A practice’s economic success allows it to invest in the people, drugs, equipment and facilities necessary to practice good medicine, provide the kind of client service that keeps clients coming back and reward owners for their investment. Data from another study, the 2003 AVMA-Pfizer Business Practices Study showed that the quality of
business management hadn’t improved in practices from 1997 to 2003. This data from the Profitability Estimator doesn’t indicate much change since then. What management practices need to change to get out of this performance rut? National Commission on Veterinary Economic Issues CEO, Dr. Karen Felsted can elaborate.
Why now might be the best time to sell a veterinary practice.
A number of practice owners who considered selling their practices in 2009 have delayed this decision until the economy “turns around.” Although there may be some validity in holding on until revenue increases, there are other real concerns that may make selling now an even better idea. What impact will an increase in personal and capital gains taxes have on practice sales? How will a growing number of practices for sale and potential buyers opting for start-ups further flood the market? Does the fact that money is at good rates and buyers are plentiful make this a good time to sell? Despite a slow economy, many practices have not lost value says David King DVM AVA president of Simmons Southcentral, a leader in veterinary practice sales and valuations.
Many veterinary practices missing out by avoiding social media.
With more than 400 million Facebook users and 100 million Twitter users worldwide, there’s no denying that social media are here to stay. Veterinary practices that embrace social media by building Facebook and Twitter accounts can connect with thousands of area pet owners every day. What types of information should veterinary practices post? When is the time to post? And what are the steps to follow in setting up social media accounts to help build friends, followers and fans? Get the low-down on how veterinary practices can adopt a few basic social media principles to boost their visibility. Find out from veterinary website designer Kelly Baltzell of Beyond Indigo Pets
Most veterinary practices fall short at tracking the cost, or benefit of discounting.
A recent survey conducted by VetPartners members, Tracy Dowdy, CVPM and Shelley Johnson, CVPM shows that 64 percent of practices wish to change their planned discounting programs for 2011. But the majority of practices don’t know what these planned discounts cost, while over half can’t say what revenue, if any, is gained. In theory, discounts — both planned and unplanned — should be used to build loyalty, but how many benefits do the offer in practice? How can practices set the benchmarks necessary to measure how well discounts work? What types of discounts work best, and why?
Notes from the Turbocharge Newsletter
Every time I come to the USA I am reminded of three things;
Just how lucky we are in Australia.
The wages in Oz are so much higher — especially for support / ancillary staff — and also for employed Veterinarians as well. Here (in the USA) you might get;
- $11 dollars an hour (non veterinarian)
- A day or three paid sick leave
- No superannuation
- A 40 hour week
- 5 days a YEAR holidays (No holiday loading)
- 4 Public holidays a year
Just how badly the economy has been hit
There are veterinarians being laid off everywhere — and consequently opening up on ‘every corner’ — this forces fierce price competition and a big decrease in shopped fees. Spey / Neuter / Vaccination Clinics are a dime a dozen.
Vaccinations are as low as $15.00 and consultations from $20.00. Internet pharmacies abound — and of course many people source flea / tick / worm / heartworm products on the web.
Wages for employed veterinarians are pitiful. Profits for practice owners are poor.The unemployed rate is nearly 10% – and in many areas it is a lot worse. Many practices are more than 15% down in transaction numbers.
And YET — the practices that focus on;
- going the extra mile
- speaking nicely on the phone and answering it promptly
- having (squeaky) clean premises
- nice uniforms
- ‘nice’ looking handouts
- courtesy phone calls
- sending pathology results in the mail
- ringing clients with pre-aneasthetic blood results
- ringing clients with pathology results in general
- ringing clients at the completion of their pet’s surgery
- having tiered desexings (so as to cater to a wider clientele) and
- having the veterinarians and staff create a visitation ‘experience’
are excelling both in terms of clients through the door as well as gross fees and net profitability — no matter what demographic they are in.
I guess what I am saying is that — the client is after Value and an Experience — and when they receive those two, they will seek them out and pay handsomely for them — no matter what the cost.
What I am saying is that – those who believe the economy will affect them — allow it to happen. I’m happy to argue this point as I see so many practices actually thriving in areas (supposedly) worst hit by the recession — both in Spain, Europe in general, the USA and Australia.
Lastly — Over here — Service is King!
The Americans are so much better at client service than we are. All the Veterinary staff, staff in hotels, motels, airlines, supermarkets, grocery stores, etc — give exemplary customer service. They are polite, considerate and courteous.
Service is not just lip service — it is an absolute fact over here. The hotel staff are just one fantastic example! And – why not? After all when your real and true income relies on TIPS — then you’d better give excellent service or you go hungry.
I did quite an amount of Veterinary ‘secret shopping’ whilst I was here. Almost every practice I walked in to (that wasn’t a low end spey / neuter / cheap vaccine clinic) — had a ‘Client Greeter’ that opened the door for me and escorted me to reception (and then later on escorted me out).
Those that didn’t have a Client Greeter — had a receptionist that came over to me, acknowledged me and introduced him/herself. I watched in amazement the height at which customer service is over here compared to most practices in Australia.
You can click here to visit Diederik Geldermans website
Converting phone shoppers into clients
A lot of people think price shoppers are just cheap, but often that’s not the case at all, says Karyn Gavzer, MBA, CVPM, owner of KG Marketing and Training in Springboro, Ohio. By price shopping, pet owners are conveying the message that they’re willing to spend money on their pet–it’s up to you to convince them to spend it at your veterinary practice.
Keep in mind that most price shoppers are simply uneducated about what’s best for their pets, Gavzer says. They think all veterinarians are more or less the same and their pet will get the same care everywhere, so it’s simply a matter of finding the best price. To show them that’s not the case, you need to demonstrate a significant difference between your practice and others. The way to do that is to treat these callers with care and respect — don’t make the conversation about money; make it about their pets.
Instead of simply stating a price, engage the client in a conversation about his or her pet. Ask for the pet’s name, breed, age, and weight, and ask if the client has any special concerns. Show phone shoppers the kind of care and attention they can expect from you. Close by giving them a price range on the service they’ve asked about and offer to set up an appointment for them. Often, you’ll find that the price shopper will be willing to do just that, Gavzer says. “I find that team members are quick to go right to the price and forget that this is all about the pet,” she says. “It’s a prime opportunity to educate a pet owner who doesn’t understand anything except cost
You can click here to see other articles from Karen Gavzer in the DVM360 website
“Bam, You’re It!” – Promoting Practice Managers From Within
From an article in the My Exceptional Veterinary Team newsletter
Today, practice owners have several options concerning how to find and select a practice manager. Some practices will select their manager internally by what I call the “Bam, You’re It” factor. They may choose the employee who has worked at the practice the longest. Often in those situations, the new manager may not have the skills, know really what is involved, or perhaps really didn’t want to manage.
I recently visited with an owner who lost his longtime manager of twenty-six years, Claudia; she just wanted to spend more time at home with her family. The owner decided to choose the “next in line” to fill her shoes. It was a technician, Sylvia who had been at the Practice almost as long as Claudia. Sylvia moved into Claudia’s desk, answered Claudia’s phone, and took on Claudia’s schedule.
After six months, Sylvia decided to leave. She just didn’t like going to work anymore. She didn’t think anyone liked her anymore and she really missed being a technician. Now, the owner was without a manager again. What went wrong?
It’s important to think about the advantages and disadvantages of promoting from within.
Advantages of Hiring Internally:
- They know the flow, team, patients, clients, and vendors
- Have invested time in the Practice
- Have earned trust of the owner
Disadvantages of Hiring Internally:
- Have become close friends with certain team members
- Perceived leadership team respect may appear low
- Too familiar with the flow
- Checks and balances may be relaxed
- May or may not have the management/leadership skills, knowledge, or desire
It isn’t wrong to look in your own environment for a manager, but the search for the right candidate may take the owner not only outside of the practice, but may also lead outside of the state. Other places to find manager
candidates are through job banks, journals, recruiters, and word-of-mouth.
Whether promoting from within or hiring from outside of the practice, the owner needs to have the following in place:
- Have a clear vision, expectations, and job description of their candidate in-writing. They need to be clear about what they want in a manager.
- Make a list of qualities that are important and be realistic; sort the “must-haves” from the wants. If the practice owner and the candidate do not agree on philosophy…it won’t work!
- Establish the hiring protocol and be consistent. Apples-to-apples comparison of the candidates is important
- After the decision, it’s not a done deal. The owner must work with the practice manager to develop the expectations and agreements of their
relationship as well as support development of necessary management skills.
The owner should be willing to do the work up-front in order to realize long-term freedom, improved quality-of-life, and practice profitability. Typically, the learning curve of a new manager is about six months for
managers that have experience of two plus years and longer for the less experienced.
Has your practice ever experienced the “Bam, You’re It” factor? What were the results?
You can click here to visit the My Exceptional Veterinary Team website
Pet Health: Products & Services in the USA
Consumer spending on pet health products and services in the US is expected to reach $33 billion in 2014. Manufacturers’ level pet health product demand is forecast to increase 5.8 percent per year to $5.5 billion that year. Gains will be driven by a growing pet population and, more significantly, the ongoing trend toward humanizing companion animals. Advances in veterinary technology will also drive pet health spending.
Preventive products to continue doing well
The perception of pets as family members has made pet health a traditionally “recession-resistant” industry. Although somewhat impacted by the recession that began in December 2007, spending on pet health has shown fairly steady growth over the last decade and will improve as pet owners are more able to afford expenses as the economy recovers. Preventive products, such as dietary supplements and certain parasiticides, have shown especially good growth recently, and will continue to do so. Among product types, pharmaceuticals overtook parasiticides as the largest demand segment in 2009.
Increased spending on pet health has lengthened the expected lifespans of many companion animal species. Concurrently, incidences of age-related medical conditions (e.g., arthritis, cancer) have also grown. Weight-related conditions (e.g., diabetes, heart disease) will also lead to rising demand for products and services, as nearly 40 percent of pets are overweight or obese. In order to better afford these treatments, more owners will purchase pet insurance policies, with revenues expected to continue growing at double-digit annual rates.
Although cats represented the largest segment of the pet population, spending on health care products for dogs accounted for a disproportionate 68 percent of the total in 2009. Spending will remain larger on dog care products, as dogs’ greater time spent outdoors increases their exposure to environmental hazards, and dogs are more susceptible to certain medical conditions, such as heart disease. However, research and development on more cat-specific health products will increase cats’ share of the market going forward.
You can click here to visit the Market Research.com website