Guess who's not coming to dinner?


What a pity that respect is not an edible commodity.

What a pity that respect is not an edible commodity.

The one commodity that our profession has in abundance is the respect and admiration of society. It seems that a huge percentage of the world's population aspired to be a veterinarian at one time or another.

Well, I can think of no better way to sink the world's economy than to have all their dreams fulfilled.

It's not that we are starving masses, but our return on investment is just not that great.

Also "not great" is the trickle-down phenomenon that always encompasses our overworked and usually underpaid staff.

Somehow, many practitioners have the feeling that they can outrun this problem. The thinking is that: "If I can get bigger and see more clients, all will be better. I can just keep on making a poor income on greater volume, and that will solve the problem."

Increasing our overhead by adding associates, more staff and more stuff seldom leads us to the success that we envision.

Today, unless you are in a very high-growth area, your client base is shrinking!

History may conclude that fewer clients and patients may turn out to be the best thing that could have happened to improve our economics.

For the moment, let's put aside the question of whether society should support the care of all animals. We can file that question next to the one that asks whether everyone deserves to have toilets that do not block up. As long as residential plumbers earn $10 more an hour than veterinarians, I cannot get behind universal care concepts.

For the last two decades, I have been computing the "right fees" for animal hospitals, using the average family income as a major part of the computer algorithm. After 2000, this changed drastically, and the computer model changed with it. The average family no longer is the average client. Those using our demographically created fee schedules have seen higher fees more readily accepted.

We know that about 60 percent of the population has pet(s), and only 60 percent of pet owners will seek medical care from a veterinarian. That computes to 36 percent of the population, and you can bet that these people are not average. They are in the top 20 percent of earners.

We have always known that 95 percent of our profits come from 55 percent of our clients. The other 45 percent, the rabies-only client and similar denizens, provide only a percent of the profits, if that.

Now, client transactions are down in most of the country. We have studied just who is not coming in. No surprise—70 percent of non-responders to reminders and recalls are from that bottom 45 percent, which also were the source of 80 percent of client complaints, according to Veterinary Productivity projections.

Most practices have tried to keep their fees affordable. Now the majority of lower-income pet owners are staying away with greater frequency.

It requires that we increase our fees to support our hospitals and staff with fewer but more affluent clients. There has seldom been a time in our history when pets were more of a luxury than they are today.

With a rapidly increasing supply of veterinary professionals and little or no increase in the number of pets, client/patient transactions from more quality care-minded clients are exactly what we need.

Recognizing this, we need to adjust our fees and staffing to accommodate the economic trend. Higher fees and fewer, better-trained staff is the only feasible solution. We cannot, as a profession afford to subsidize the ever-increasing portion of the community forced to balance the cost of gasoline against the cost of veterinary care with little or no increase in family earnings. Discretionary income is the default victim.

America's households are debt heavy and continue to maintain a negative saving's rate. Something is going to give, and our practices are feeling the loss. A recession in 2007 is very likely.

The need for greater awareness and preparation are, sadly, not being recognized by our national associations. The "good times do not always continue to roll."

If your transaction numbers have leveled off or are dropping, you need to be aware that it most likely will continue. Reconsider expansion plans, if this is the case. Look at your budget and tighten up. With escalated energy costs, we need to take the unpopular, more conservative view. This is the time to downsize expensive telephone directory ads and upsize your staff training programs. Fewer, very well-trained staff will always better serve your practice needs. You need $5 to $7 in revenues for each dollar of payroll expenses.

You need to serve the needs of those clients who will continue to use your services very well! Referrals from these clients will be peers who can afford today's services.

E-mail addresses should be a part of client registrations to keep communication at the highest level.

Finally, consider professional staffing. Is the number of associates getting close to outnumbering clients?

Most who have followed this column for more than two decades know that reality is a cold, hard aspect of my writing. I just cannot watch my colleagues spend themselves into debt while trying to please everybody. Clients have to dig deeper to pay for the medical care their pets need, and we need the foresight to plan for it.

Dr. Snyder, a well-known consultant, publishes Veterinary Productivity, a newsletter for practice productivity. He can be reached at P.O. Box 189, Hebron, KY 41048-0189; (800) 292-7995;; Fax: (859) 534-5265.

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