When The Tail Wags The Dog….
I recently read an article written for veterinarians, by an accountant, that deals with ways to recuperate lost income due to the Covid-19 virus pandemic.
His recommendations were not a surprise, because we had seen this happen during the housing crisis that led to a recession with loss of jobs and income. Many veterinarians did what their accountants told them to do in order to survive the economic crisis. The accountants use standard models such as if your gross income is down 15%, then raise your prices by 15%. Seems logical. But, not when people are struggling.
The problem with accountants is that they don’t understand the big picture. They just understand bottom line. Unfortunately, most vets know little about economics and money management, so they turn their books over to their accountants and adhere to their recommendations.
As a veterinarian for almost two scores, I learned a long time ago that running your practice from the bottom line is like the tail wagging the dog. When you start focusing on profit rather than compassionate health care, you are going to get into trouble.
To understand this truth, one has to stay focused on the reason why we got into this profession. Most vets know that being a vet is not going to make them rich, economically speaking. If they want to get rich, maybe they should be mortgage bankers or investors.
Focusing on bottom line is about fear, not about compassion. If I don’t get my income then I will go out of business. The tail wagging the dog. However, if I stay focused on doing my job from a loving, compassionate perspective, the bottom line ALWAYS takes care of itself.
During the housing crisis I remembered new clients coming into my office telling me horror stories about how their pet needed care and their vet demanding full payment up front. These were clients who had supported these vets for years. They would tell me stories that one of the spouses had been laid off and that income was tight or that both had been laid off. This is not the time to strong arm you clients because your bottom line is down.
I set up a policy so that the client could pay half their bill at the time of treatment and we would carry the remaining half until they could pay it off. These were people we did not know but we stayed adhered to the policy to provide compassionate health care and let the bottom line take care of itself. Not one person failed to pay their entire bill and oh my gosh did we get a lot of new clients. The bottom line did indeed take care of itself.
Years later when I sold my practice the commercial realtor who specialized in veterinary practiced asked me why my business was up 20% while most clinics were down 10%. I told him that we used different economic strategies.
Be prepared when the vet restores normal function again. Many will be promoting non-essential services and sales to help restore the bottom line. Remember, this is not what makes a successful practice. Make sure that compassionate health care is first and foremost and everyone will come out ahead.