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If an industry is successful, it will attract new entrants, but this can reduce the profitability for all businesses in that industry. In the veterinary world, these new entrants could be an extension of an already existing product; for example, a new traditional-type practice, or a new version of a product; for example, a corporate practice. New veterinary graduates were also considered within this discussion.
Corporate veterinary businesses turned out to be the main topic of conversation when the groups discussed new entrants. There was some degree of confusion among participants about the definition of corporates: was it public ownership that made it corporate, or the way in which it behaved, asked one. Above all, it was agreed that corporates normally have access to capital. There was a general consensus that corporates would continue to increase in both numbers and popularity, but many of those present did not believe that this was a problem for the industry. Corporate was seen to be a ‘dirty word’, said one participant, but the corporate model could also be applied to the general, family practice. One group suggested that the definition of a corporate was perhaps more about the way in which a business was run. This was reflected in other discussion groups, and it was felt that if the veterinary industry continued to view itself as a profession, rather than a business, then the corporate model would take over. As one person put it, ‘If you don't view it as a business, you have little scope to reinvest and improve your services.’ However, if practices looked to the corporate model, embraced this change and worked with it, then, as one member said, ‘they can piggyback on their success’. It was suggested that corporate practices would not only help independent practices grow, as had been seen in the case of opticians; they would also help grow the overall veterinary market. This could also increase the ‘medicalisation’ of pets, that is, how much their owner would visit the vet.
The number of UK veterinary graduates is steadily increasing, and will continue to do so with the arrival of new veterinary schools, such as the University of Surrey veterinary school that will open in 2014. While some felt this to be a problem, at least one group member felt that the veterinary profession needed to change its view on new graduates: there might not be enough jobs for all of them in practice, but there was scope to work in other areas, such as research, management and policy. The analysis undertaken before the meeting had highlighted a shift in the financial circumstances under which graduates enter the profession, mainly due to the fact that veterinary students are now incurring costs of up to £45,000 for fees alone for the five-year course. While a recent RCVS survey suggested that graduates were still finding jobs, some appeared willing to work on zero-hour contracts and, with EU graduates coming to the UK for veterinary work, there could be potential for a downward pressure on salaries. When discussing the idea of a veterinary practice as a business, one participant said that graduates were ill-equipped to enter the market; they might be trained in clinical skills, but their knowledge of profit, business and ownership was ‘not good enough’.
Some believed that the rise in the number of female vets constituted another type of ‘new entrant’ to the industry. Two groups discussed the potential for women to return to work after starting a family, and the possibility of, for example, two mothers coming together to co-own a practice. Given the demographic shift in the profession in recent years, this type of new entrant, ‘the returning mother’, could be a possibility, they said, as they may choose to run practice differently for the benefit of both clients and employees. In addition, it was suggested that, as women took a career break to have children, this could present opportunities for any type of new entrant.
There was a clear worry among most of the groups about the rise in the supermarket and ‘convenience’ entrants that could enter the market. Over 80 per cent of consumers go to the supermarket for their pet food, so if a veterinary surgeon was present to offer vaccination or clinical advice, consumers might take it, it was suggested. This was already happening in the USA, but there was a degree of uncertainty about whether it would happen in the UK.
Supermarkets, it was pointed out, are highly competitive, and work on the lowest margins possible – it is a very different industry from that of the veterinary one. Add to this the complications of bringing animals into a food store and whether a vet would want to work in such an environment and it might not be something that was viable. Supermarkets had attempted to collaborate with pharmacists in the past and one participant said that they had not had a good experience with this and that they may not wish to engage with another group of healthcare professionals.
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