The World of Equine Vets is Very Small

I just came back from the Equine Business Management Strategies International meeting in Amsterdam. This was the first meeting in Europe based on the successful Equine Business Management Strategies course held each September in Wisconsin. The few North Americans attending the conference were able to spend an intense 4 days being educated on business management with the attending equine vets from Finland, Denmark, the UK, the Netherlands, Germany, France, Italy and Portugal. Quite the mixture of equine vets attending! When we all got together and began discussing the challenges, we were surprised to learn that the North American and European vets are facing exactly the same problems: Succession planning, cut-rate veterinary competitors and practice governance.

Succession Planning

Unlike most North American practices it appears most European vets work in large group practices that have equine, companion animal, bovine and even porcine vets under the same roof. It was not uncommon to have a vet announce that they were partners in a 20+ vet practice! This is very rare in North America. We did share common concerns about bringing on new partners and resolving current partner issues. The continued success of our businesses depends on succession and if we can’t determine accurate practice value, find partners willing to buy in, and institute proper governance, then our current practices will die out when the partners retire. New European vets fortunately do not have the debt load of their American counterparts so they do have the ability to buy in sooner. The problem remains of how to properly and fairly determine practice value in the current recessionary market place. How can a new partner pay their debt load when a practice has reduced income with increased expenses? This is a problem on both sides of the Atlantic.

Cut-Rate Veterinary Competitors

This subject probably caused the most discussion. We all have neighbouring vets who think if they lower their prices that they will get busier, without realizing that this does not equal more profitable. Clients think this is great for them, but the long term outcome of this habit can be dire. Our expenses still continue to rise significantly and the only way to maintain profitability is to work much longer hours. The reality is that new grads will not work excessive hours that workhorse vets from an earlier generation who are nearing retirement age. There is a different emphasis on life choices with newer vets, but at the same time a professional graduate has the expectation of a salary appropriate for their education. How can a practice with decreased profitability due to slashed fees pay for a new associate and still stay in business? There is a potential future for horse clients where vets do not buy up-to-date diagnostic equipment, continuing education is ignored, and longer hours worked result in more errors because of fatigue and burnout. Remember, there will no be new vets joining the profession in this scenario so what you have is what will remain.

Practice Governance

Vet partnerships form because people work well together, they are classmates, or they have been part of practice long enough that is seems to be the next logical step. Rarely is a set of rules written down that instructs the partners on how the business should be operated, and the results can be catastrophic. How to determine partner buy-outs or buy-ins? How to deal with partner death or divorce? When large group practices face this, the outcome is immobility. Decisions are not made, plans to deal with the economy are ignored and the practice is left circling the drain.

Kudos to the veterinarians that attended this course regardless if they were from North America or Europe. By no means did we have the answers to all of our challenges but we knew more than before we came. All of us left with the resolve to do something to improve the business management of our practices and profession. The ultimate benefit is for horse owners and their horses. Let us work towards a future of vibrant, healthy and progressive vets working on improving the health of the horse.

A special thanks to Dr. Joop Looman of the University of Utrecht College of Veterinary Medicine for hosting us. He was assisted by Dr. Arno Werners.  Both made all of us feel at home. Thanks also to Dr. Bob Magnus for creating Equine Business Management Strategies and having the vision to bring it to the rest of the world.

Better practice management results in better medical care for our patients. Does anyone disagree?

 

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