Growing a veterinary practice in a bad economy
You already know the economic news stinks. These days, we're bombarded with the bad news from all sides. No one really knows when things will return to normal. So what matters most is how you respond to the recession within your own clinic's walls—you have control over that. While veterinary practice certainly isn't business as usual, business does go on.
Here's the good news: According to Benchmarks 2009: A Study of Well-Managed Practices by Wutchiett Tumblin and Associates and Veterinary Economics, practices are reexamining their core services and strengths and focusing more on being efficient, effective, and productive. Clinics are streamlining inventory and staffing while continuing to emphasize the importance of adding value and exceeding client expectations. Here's an overview of what this year's study revealed about Well-Managed Practices and some tips you can put into action.
DON'T RELY HEAVILY ON FEE INCREASESHas the recession caused prices to increase? Results say yes. Fees for services such as exams have increased nominally since 2007—between 2 percent and 5 percent. Diagnostic imaging fees have increased 7 percent to 8 percent. The largest fee increases since 2007 were in lab services (13 percent to 20 percent), sevoflurane anesthesia (17 percent to 33 percent), and nonelective surgical procedures (9 percent to 20 percent).
The best advice you can take away from this data is to continue to monitor your fee structure and implement changes as warranted. But it's also important to identify what clients value. Seek opportunities to maintain and grow revenue without relying solely on fee increases. When you make a point to communicate clearly and consistently, you remove the obstacles that stand between your patients and the care they need and deserve. Look at everything you do from your clients' perspective, then look for opportunities to exceed expectations.
"We focus on customer service in a relaxed atmosphere and hope that word-of-mouth about our excellent service overrides any questions about cost," says Dr. Peter Fisher, co-owner of Pet Care Veterinary Hospital in Virginia Beach, Va. "Clients come to us because we're consistent."
Here are some highlights from this year's survey of more than 200 fees:
PROP UP DECLINING REVENUE
Production is certainly feeling the economic pinch. Medical revenue per doctor declined 3 percent from the levels reported last year in Benchmarks 2008. Each full-time-equivalent doctor (based on 40 medical hours per week) produces about $535,000 of medical service and product revenue, or $279 per hour, with an average invoice of $157 for doctor-provided care.
To combat the decline, practices are emphasizing client service, convenience, and compliance. "The value we derive from a client comes solely from the value that we provide to that client," says Dr. Darren Williams, owner of Mayde Creek Animal Hospital in Katy, Texas. "Our ability to solve our clients' problems, meet their needs, answer their questions, and enhance the bond between them and their pet is the ultimate driver of the client's perception of the value of our services."
To meet clients' convenience needs, 44 percent of this year's study participants offer outpatient appointments Monday through Friday starting at 7:30 a.m., while 37 percent schedule the last appointment at 6:30 p.m. or later. And to strengthen compliance, practices focus on clear, concise, specific direction about their patients' healthcare needs with consistent messages from everyone in the practice. "We stepped up our efforts to ensure that we're following up with clients if necessary care hasn't yet been scheduled," says Dr. Ken Lambrecht, owner of Westside Family Pet Clinic in Madison, Wis. "We don't want our existing patients to slip through the cracks."