Improving Profitability in an Independent Veterinary Practice
How a benchmarking review and a rebuilt fee structure are used to close a margin gap in a busy single site small animal practice.
- Independent small animal practice, single site
- Practice owner
- Typically nine to twelve months from first review to a full year of comparable reporting
Illustrative example. This describes the shape of a real engagement type, not a specific client. No figures, percentages or quotations have been invented, and the outcome fields are left as markers until a client approves real detail in writing.
The Challenge
Turnover had grown steadily for three years while profit stayed flat. The owner was working more clinical sessions than ever and could not see where the money was going.
Starting Position
- Annual accounts arrived nine months after the year end with no commentary
- Medicines, consumables and laboratory costs were posted to a single expenses nominal
- Fees had been raised by a flat percentage each year for four years
- Nobody had reconciled practice management system takings to the bank
Work Completed
- Chart of accounts rebuilt to separate clinical income streams and direct costs
- Monthly management accounts introduced with six tracked measures
- Benchmarking review against sector data and against the practice own history
- Fee structure rebuilt from actual cost for the services furthest out of line
- Stock count process introduced and a monthly takings reconciliation put in place
Outcome
- [CLIENT APPROVAL REQUIRED] Record the measured change in gross margin here
- [CLIENT APPROVAL REQUIRED] Record the measured change in operating profit here
- [CLIENT APPROVAL REQUIRED] Record the change in owner clinical sessions here
Timeframe
Typically nine to twelve months from first review to a full year of comparable reporting
No testimonial is shown here. We do not publish quotations that have not been given and approved by a real client.
Recognise Any of This?
If your practice is in a similar position, the first conversation costs nothing and usually identifies the one thing worth doing first.