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Signs are that vet business is improving

Statistics from Altmetric.com

By Josh Loeb

Vet practices are well placed to weather the coming economic storm – if they can adapt to cater for changed customer behaviour and the continuation of some social distancing measures.

That was the message from a number of market specialists who spoke to Vet Record this week as pandemic-related restrictions were further eased and practices saw business returning.

Vet Record understands that in the small animal sector many practices are now reporting turnover above 80 per cent of pre-pandemic levels. At the height of lockdown, survey data suggested that vet business was down to just 20 per cent of what it would normally have been.

The RCVS will shortly report the findings from its latest Covid-19 survey but preliminary results point to an ‘improving picture’ (see box). Veterinary business consultant Pete Orpin, the Society of Practising Veterinary Surgeons’ Covid-19 lead, said: ‘We’re in a transition phase. At this immediate moment there are some practices that are now back to high levels of turnover. Some are even back at the same level as pre-pandemic.’

Vet surveys reveal an improving picture

Industry surveys are beginning to show more confidence in recovery as Covid-19 restrictions lift.

The RCVS will shortly publish results from its latest survey on how the profession is coping. Preliminary results show an improving picture. While the impact of the pandemic on veterinary business remains significant, they are starting to increase the caseload they take on, practice turnover is improving, and fewer veterinary surgeons and nurses are having to self-isolate, the college said.

Market research analysts at CM Research have been tracking attitudes of vets across eight countries, including the UK, since March.

Their latest survey data captured in May, found the industry showing signs of adapting to the ‘new normal’ with vets cautious about the immediate future but more optimistic about future business in the weeks ahead.

Results in March and April found vets and vet businesses clearly impacted by the pandemic but May saw pet owners booking appointments again and signs of tentative gains in revenue.

More than half of practices were reporting an increase in appointments – up from 21 per cent in the previous month. And although practice revenue in the UK was still down, the rate of decline slowed markedly, with revenue dipping by just 6 per cent compared to 37 per cent the previous month.

There were worrying signs, however, that stress levels and increased workloads (despite furloughing) may have a lasting effected on vets – some of whom have now decided to leave the profession for good.

Nonetheless, overall the outlook for the future was ‘looking brighter,’ with all countries seeing an increase in those stating that they expect things to get better over the weeks ahead.

CM Research will conduct the final phase of its Covid-19 survey in July.

However, he warned that busy practices did not necessarily translate into longer-term sustainability.

‘That [busyness] will be based on some pent-up work. What remains is the challenge of how to improve the efficiency of throughput of clients going forward.’

While vet practices are ‘more recession proof’ than most businesses, many operate a business model based on high-client throughput, with short appointments and full waiting rooms, he said.

‘It’s quite a transition to go from the current situation, when you are keeping clients out of the building in car parks and so on, back to some degree of normality,’ he added.

This view was echoed by Veterinary Management Group president Richard Casey, who said he was ‘certainly hearing that members are seeing more of the routine work starting to come through again now’.

However, he cautioned that maintaining social distancing – even with any reduction from 2 metres to 1 metre – meant limiting the amount of work that could be undertaken on a given day.

Extended opening hours could help practices maintain the right level of income by delivering the same amount of work over a longer period – an approach that might also prove popular with clients, who want more convenience, and employees, who want more flexible working, Casey said.

‘There’s a backlog of routine or elective procedures, but there’s only so much operating capacity and consulting capacity that a practice is able to deliver on any one day,’ he said. ‘If practices are sticking to their usual ways of working, they’re not going to be able to clear that backlog in an efficient period.’

Alison Lambert, founder of consultancy Onswitch, which advises veterinary businesses, said that many practices were maintaining profit margins, having reduced staffing costs and some other types of expenditure.

‘The issue isn’t now,’ she said. ‘The issue is when furlough stops and they have to pay that full wage bill again.’

Although she is optimistic about the future for the sector, Lambert cautioned that businesses would have to evolve to cater for changed customer habits.

People will still need vets for the jobs that only vets can do

‘Will practices be OK? Some will, some won’t,’ she said. ‘Will the industry be OK? Yes, people will still need vets for the jobs that only vets can do – acts of veterinary medicine and surgery. The question we should be asking is: what have our clients learnt during this period that has taught them a new way to behave? Clients have learnt to access medicines and food and services elsewhere. They’ve learnt that they don’t need to be on the dot for booster vaccinations. Will they go back to the old way of doing things after the Covid-19 crisis is over? No.’

BVA past president and head veterinary officer at Simply Health Professionals Gudrun Ravetz agreed that the pandemic had increased the imperative for veterinary businesses to evolve.

‘Even before Covid-19, the new client loyalty was all about convenience,’ she said. ‘Convenience needs to be frictionless, accessible and self-serve. As a profession we’ve not been brilliant at providing that. We’ve now been rather forced into it.’

In her most recent webinar, broadcast on 14 June, current BVA president Daniella Dos Santos warned of burnout, saying: ‘For many employees, their employers’ actions may seem at odds with how they are feeling the practice is managing. It may feel that they are busier than ever, so finances are not a concern. However, the reality may be very different. Decreased staffing numbers may mean proportionally there is more work, but actually turnover is insufficient to sustain increased staffing levels and basic running costs.’

Her advice was for business owners to communicate the financial situation transparently.

Robin Hargreaves, another past president of the BVA and a director at Stanley House Vet Group, said: ‘The early weeks [of the pandemic] have seen a real surge in “can do” attitudes and people really pulling together. I think the hard days are really going to begin now when it becomes a long-term struggle not an acute “backs to the wall” challenge.’

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