Brad Sheasby and Vicki J. Pollard, AIA, NCARB, AAA, CVT share tips on lowering the cost of opening a new practice at the 2022 Fetch dvm360® conference in Kansas City, MO
Owning a veterinary practice can be a dream, but it also presents a major financial challenge. Brad Sheasby and Vicki J. Pollard, AIA, NCARB, AAA, CVT teamed up to discuss recommendations on minimizing costs and making optimal decisions when buying or building a practice in a session titled, “Location, Location, Location” presented at the 2022 Fetch dvm360® Conference held in Kansas City, Missouri.1
“I don't think it can be understated how important [real estate] really is,” said Sheasby. “There's such dramatic impact that real estate you can have on your bottom line.” According to Sheasby and Pollard, a building lease or mortgage is typically a practice owner’s second-highest expense after staffing and payroll.
While payroll may be the top expense for a practice, it’s not exactly open for negotiation the same way real estate is, explained Sheasby. Plus, attempting to squeeze every dollar out of staff is fraught with the risk of losing team members. “How many of you have had success in negotiating your payroll down?” asked Sheasby. “Of course not…zero hands went up. But the good thing about real estate is that it is 100% negotiable.”Sheasby stressed that practice owners should take advantage of saving money any way they can with real estate because it can drastically affect their profitability.
There are many decisions that factor into building or buying a hospital, and each one can potentially have a major financial impact on the practice. For example, should one lease or own their building? Does the future owner prefer to be in a retail center or a stand-alone commercial building? How much square footage should the building have based on the services the veterinarian wants to offer? The answers to these questions will all have massive financial implications for the practice owner.
One of the most impactful decisions one can make is where to place the practice. Sheasby and Pollard listed key factors to consider when it comes to choosing a location:
Each of these factors may influence a practice’s success and profitability. Taking them under consideration can help ensure a practice owner gets the best bang for their buck when it comes to selecting a location for their veterinary clinic.
Sheasby B, Pollard, VJ. Location, Location, Location. Presented at: 2022 Fetch dvm360® Conference; August 26-28, 2022. Kansas City, Missouri.