The BVA has expressed concern over a survey demonstrating more than half of responding vet practices had below average profitability, while 15% generated “a negative value for net profit”.
Figures from the first SPVS Profitability Survey showed a total of 54.5% of responding practices scored “below average” or “poor” on its profit-rating scale.
The SPVS, working in conjunction with Veterinary Insights, based its snapshot figures on survey returns from 9 mixed animal, 4 equine and 88 small animal practices. The practices included 96 independent businesses and 5 joint-venture practices.
Practice turnover ranged from more than £10 million to less than £100,000.
Net profit was assessed as:
- greater than 18% – “excellent”
- 15% to 18% – “good”
- 12% to 15% – “average”
- 8 to 12% – “below average”
- below 8% – “poor”
Almost a third of practices (30.3%) scored “excellent” or “good” and 15.2% scored “average”. However, 54.5% were “below average” or “poor”.
The median profit level for all practices was 10.6% and 15% of all practices generated a negative value for net profit.
The survey looked at five parameters:
- transaction volume index – a measure of “busy-ness”
- cost of drugs and supplies as percentage of turnover
- cost of all people as percentage of turnover
- establishment and overhead expenses as percentage of turnover
- net profit margin (after owner’s remuneration) as percentage of turnover
Responding to the figures, BVA junior vice-president Gudrun Ravetz said: “Although this is a small survey, the figures that suggest more than a half of practices have below average profitability, and 15% have negative profitability, are a concern.
“One of Vet Futures’ ambitions is for ‘thriving, innovative, user-focused businesses’ and it is vital veterinary practices have a sustainable, profitable future so vets can continue to care for and protect the health and welfare of animals.”
- Read the full article in the 19 September edition of Veterinary Times.
- The SPVS Profitability Survey is available to all practices.