Accountants for Small Animal Practices
Small animal practice is a high-volume, high-transaction business. Profit comes from consultation throughput, the procedures that follow, the medicines dispensed and the recurring income a health plan book provides. Small movements in any of those compound quickly.
Where the Money Is Made and Lost
- Pet health plans
- Well-run plans give predictable income, better preventive compliance and higher client retention. Badly priced ones lock the practice into delivering services below cost for a year at a time. Both the pricing and the accounting treatment need reviewing annually.
- Consultation capacity
- Appointment length, utilisation and the conversion from consultation to procedure are the levers behind revenue per vet. Capacity problems often look like recruitment problems.
- Drug and food margin
- Under real pressure from online pharmacies and retailers. Practices that price dispensing without understanding their true cost lose margin without noticing.
- Prescription and dispensing income
- An area directly affected by the CMA remedies on prescription fees and price transparency, which is worth modelling now rather than when the orders take effect.
Where We Start
With a small animal practice the first exercise is almost always the same. We split revenue into consultations, procedures, dispensing and plan income, then set each against the cost of delivering it. Practices are frequently surprised by which of the four is actually carrying the business.
The second exercise is capacity. Appointment length, utilisation across the week and the conversion from consultation to procedure decide revenue per vet, and all three are manageable. A practice that believes it needs another vet often needs a different appointment structure, which costs nothing.
The third is the plan book. Annual fee against the actual cost of everything a member is entitled to, at real utilisation rather than the figure assumed at launch, and total annual spend of a member against a non-member.
Frequently Asked Questions
Are pet health plans profitable?
How do we compete with online pharmacies on medicine prices?
Our consultation numbers are up but revenue is flat. What does that mean?
Review Your Small Animal Practice Numbers
Send us your accounts and a plan membership summary and we will show you what your plan book and your drug margin are really doing.