Practice ownership is seen as the pinnacle of a vet’s professional career by many. Once you enter the ranks of ownership you are not only in charge of the health of your patients you are now responsible for the health of your business. In the same way that you approach your care for a patient, practice ownership requires a studied and expert approach.
The Vital Signs
An important step toward a healthy business is to understand ‘the vital signs’ of your practice. As a clinician, you regularly observe the condition of your patients and modify the treatment accordingly. As a practice owner you need to do the same. In our experience, some of the vital signs you need to track are: –
- Pulse rate – the practice’s relevance to its customers; number of customers, frequency of visits and the level of spending on both service and retail products.
- Blood pressure – efficiency of the services provided; level of staff input into the services.
- Temperature – the cash flow coming out of the practice.
Assess the operating temperature of your practice. Know how much money you need to: live the lifestyle you want, save for the future, reinvest into the practice, and pay your taxes.
Also, be clear on the pulse rate your practice needs to reach the operating temperature required. That is, calculate how much activity (the pulse) you need within the practice to meet the financial needs of you and your practice.
By monitoring the temperature and pulse rate of your practice you provide yourself with a regular update of its health and this allows you to make necessary changes to address potential problems quickly and decisively.
The sustainability of your practice will be largely determined by the business strategy of your practice and your ability to implement, manage and modify this strategy. This is similar to a care plan for a patient.
Develop a strategy that encompasses promoting the practice, developing the skills of the staff and measuring the performance of key areas. knowing is important however the key is acting, by effectively implementing your plans and then measuring performance .
Some key measures you may find helpful are: -Consultations per vet per day. Average fee per consultation.Product sales per consultation.Actual to budget profitCustomer numbers per month, andCash flow to target.
In the practice, you would not treat an animal without: looking into its history, assessing its current health state, and monitoring its progress. The business of running a practice simply requires you to apply these same approaches to a different setting.
When you treat an animal you achieve success based on years of experience and expert knowledge from study and work. When it comes to practice ownership, the basis for success remains the same. Seek expert business advice from people who know the vet industry and what it takes to maintain a healthy practice.