Know the demographics before you buy a veterinary practice
A white elephant is a valuable but burdensome possession that its owner can't dispose of—the cost of which, particularly the cost of upkeep, is out of proportion to its usefulness or worth.
Follow the crowdWe have two scenarios today. There are clinics located in prosperous areas that are growing their client base by at least 1 percent to 2 percent per year, and then there are those clinics located in less fortunate states that are leaking clients by the bucketful. This has nothing to do with the financial fiasco of 2008. Population migrations have been in high gear with nine million people relocating in the last 15 years.
So here's my advice to underemployed new graduates: visit http://census.gov/compendia/statab/2012/tables/12s0015.pdf, and follow the crowd. Get licensed in growing states and make life a whole lot easier. For those in states with populations declining at a rapid rate, merge client populations with small, low-overhead, minimally equipped satellites that surround a superbly equipped and cooperatively owned central facility. Yes, the client may have to drive another five to 10 minutes, but you may just save your retirement from extinction. The key word here is "cooperative."
Change is the only constant
Changing to a central hospital plan not only spells success for everyone involved, it also creates easy exit plans where few are possible today. The next decade may be marked by empty veterinary hospitals wasting away while young veterinarians drive school busses to earn enough to get by (meanwhile, interest on school loans continues to compound).
But don't fret. If you're willing to relocate, there are still practices to buy in prime areas that the demographics show are ready to grow. Just stop and think before you buy any existing practice. And really, all of this worry is unnecessary when we realize change is the only constant in life. We must be open to change, especially in declining states. Ask your accountant or consultant what direction your practice is heading and make the adjustments you need to survive.
Dr. Snyder, a well-known consultant, publishes Veterinary Productivity. He can be reached at 112 Harmon Cove Towers Secaucus, NJ 07094; (800) 292-7995; [email protected]