Q&A: The new realities of practice growth
What's a good way to gauge what our current growth numbers are telling us about our practice's financial health? What growth percentage should we aim for these days?
The human-animal bond has maintained financial stability, while many other industries have suffered far worse, says Veterinary Economics Editorial Advisory Board member Gary Glassman, CPA, partner with Burzenski and Co. in East Haven, Conn. Veterinary practice growth can come in two ways: in the invoice volume or average invoice amount. You want to know if you have more than just total sales growth. Dig down to find changes in both the number of invoices and the average invoice amount.
Recently, practices have continued to see growth in the average invoice amount of 4 percent to 5 percent year over year—even in a recession. However, many practices are seeing a decrease in the number of invoices—the average drop is about 3.5 percent. Shoot for an increase of about 3 percent to 5 percent in invoice volume. If your practice is struggling, check your records to make sure clients are still responding to reminders. If your year-to-year return ratio is falling, consider reminding clients who are not coming in after six months. Teach them the importance of yearly checkups and preventive medical care as cost-effective ways to take care of their pet.
