11 inexpensive ways to brighten a practice amid recession
My goodness, look at all the layoffs, even within the biggest and strongest companies.
Layoffs and more layoffs dominate the headlines, along with wage cuts.
It's goodbye to many businesses: 40,000 will close this year.And some veterinary practices will be swept away alongside them.
Will the veterinary-service sector also be considering layoffs and cuts?
No ... well, maybe.
When cash is flowing freely, even the weak survive. But when the going gets tough, Darwinian mechanisms take hold. The strong survive, perhaps thrive. For some practices, times are tough. For others, things keep rolling along nicely — sometimes even within the same community.
Nearly a generation of DVMs has never seen hard times or struggled with business. Most will adapt, but it will be a challenge for some.
Part of the reason for the shake-out is that we've had at least 10 years of robust growth in veterinary services, increased sophistication and relentless increases in fees fueling still more expansion.
To evaluate our future, the first question we must ask is one that many failed businesses failed to ask: Do we have a product or service that customers will purchase at the price we are asking?
While the growth years were great, what suffered was sound business mentality. A balancing of capitalization costs vs. fees to be collected is really not part of many discussions about veterinary economics.
We see huge capitalization costs out of balance with safe debt loads. These debt loads cannibalize other budget groups, including funds to pay support staff.
We read that student debt loads are too high, but debt is burdensome for private practices as well.
A good example of excess capitalization is the cost of practice housing. We like to see it around 7 percent, but now some facility expenses are at 15 percent or more. Ouch.
The government is pouring tax dollars into the economy.
That will keep the economy floating along, but eventually the excessive capacity must be eliminated and economic accountability must return to business plans. These issues will affect our lives.
Keep a good support staff
Now is the time to consider our plan for the next six, 12 and 24 months while the economy adjusts to the bailout, the trimming, pruning and elimination of the deadwood.
Despite all the concerns, the bright spot is that good pet owners will continue to take care of their pets.
We must expect to provide more accurate estimates, accurate prognostics, more accountability in response to consumer demand and economic bumps that include national events, local events, local storms, a personal health crisis, a divorce, a funeral and such.
The challenge is to take this time to create positive energy for your practice.
Certainly the most important factor to surviving a down economy is the support staff.
So nurture, feed, nourish and treasure key employees. A well-rested, attentive support staff is essential to good customer service. Cutting the staff undercuts morale and compromises customer service.
Support staff numbers and skill are linear with income. So in a down economy improved customer service is an edge for a practice because clients will remember the good service when the rebound comes.