ProSal percentages

Feb 01, 2006

I'm a bovine practitioner looking into ProSal compensation for my associates. I'm concerned with the percentage used to calculate the portion of the salary above the base. What percentage profit should a practice owner expect to make off of his associates?

"Typically you'll pay 18 percent to 25 percent of a doctor's production, not including bulk sales purchases, using ProSal," says Veterinary Economics Hospital Management Editor Mark Opperman, CVPM, owner of VMC Inc., a veterinary consulting firm in Evergreen, Colo. But you'll base the percentage you use on your actual costs of doing business. So the percentages you use could be higher, Opperman says, if you don't have a physical facility and your expenses are lower. "The average percentage used in a bovine practice really depends on the cost structure of the practice and the overhead expenses," says Opperman. "I've seen practices pay up to 40 percent, but the average is closer to 35 percent.

Mark Opperman
"If you calculate your rent, utilities, lay salaries, insurance, and so on, and you pay an associate 25 percent of his or her production, you're lucky to have 10 percent to 20 percent of profit or return on investment left. The bottom line is that an owner's entitled to a return on his or her associate. So figure out your total costs, factor in the associate's salary, and see what's left. It needs to be a win-win situation," says Opperman. (For more on the ProSal formula, see "Salary vs. Production".)