Why do some veterinary practices do better financially than others? Demographics can play a role, but usually an area that has to keep charges down will also have less expenses related to overhead. I believe that the two biggest factors are the average transaction of each veterinarian and the average transaction of the practice as a whole. These are two completely separate items; however, the doctor’s average transaction must be much higher than the clinic’s. If the clinic’s transaction is not high enough, then the staff isn’t doing their job of selling. I have always told people whom I hire, including veterinarians that we are in the business of selling. Many times I have been given odd looks and I could sense their feeling of uncertainty, until I explained what I meant. In the veterinary industry, every day we ask people to take their discretionary income and spend it with us on services or products that we feel are necessary for their pet. A dictionary definition of sale is: “The exchange of goods or services for an amount of money or its equivalent; the act of selling”. As veterinarians, we must get to a point where we are not afraid of the word “sale” and understand that this is a part of what we do. Fortunately, we are not human physicians who are dealing with government and insurance. Instead, we are small business people trying to sell our products and services to a client base of people who love their pets. Luckily, we are in an industry where we do not have to cold call or try and sell something that we do not believe in. The good news is that all we have to do is provide the best possible veterinary medicine that is available and then let the people decide.

Most numbers you see, whether it is AAHA or AVMA statistics, say that the average transaction in a clinic should be over $100. If it isn’t, then we are doing a poor job as receptionists and technicians of selling our products and services to our clients. Clients are still getting these products and services from somewhere, so the question is: why not us? Most numbers say that an average transaction for veterinarians is between $160 and $170. I have seen that this is too low to fairly and adequately provide your client with the best care for their pet. Being over or around $200 provided much better care for each individual pet. A few years ago, I put into affect a bonus system for my associates that paid a percentage of their sales based on average transaction. The top percentage was 21% of sales, if they averaged over $200 for the month. At first, I had some who complained saying that all I cared about was making money, and that they wanted what was best for the client. I proceeded to tell them my thoughts. I believe that if we offer all of the services we provide and then let the client decide, is that good or bad medicine? If we take an x-ray that maybe we could get by doing without, and then find a tiny fracture, is that good or bad medicine? Once everyone was on board, we have not had a month where the entire staff of seven veterinarians has not been over $200 every month. During the recession, even though we saw less numbers at most clinics, we did not dip because our transactions were up to overcome this.

Pay attention to your average transactions in your clinic overall and by your veterinarians, and see what your numbers do. It does not take much effort to get from $160 to $200 on an average transaction, but look at what that does per transaction. Take a month of transactions and multiply that by $40 each and see if you can get excited. Take a clinic where non veterinarian transactions are $70 and raise that to $100 and see what happens. The only difference is getting the people you already pay, selling what you already carry. Get your staff to sell a year supply of flea and heartworm prevention instead of 6 months. Do not get upset over online pet pharmacies; instead, set your prices to compete and sell more. A few little things can change your practice income directly. I believe we spend so much time trying to figure out plans and strategies that we forget the simple things that we can all do. Increase your average transaction and see what your gross income looks like at the end of the year. And always remember KISS (keep it simple stupid).