Taking steps to avert disaster - Veterinary Practice
Your browser is out-of-date!

Update your browser to view this website correctly. Update my browser now



Taking steps to avert disaster

The Mercury Column, in which a guest columnist takes the temperature of the profession – and the world around

WITHOUT intending to be
insensitive, one could see some form
of an analogy between the
catastrophic loss of Air France flight
AF447 en route to Paris from Brazil
earlier this summer and what I
suspect is happening to the business
of veterinary
practice in the UK.

If I’m right, we
are far more fortunate
in that there is still
time for us to avert a
disaster but to do so
will require a
behavioural change in
the profession. The
last 20 years have
taught me that that is unlikely to come
easily but, to paraphrase a letter printed
in another journal, “it is clear to me that
the veterinary profession is part of the
problem and it just doesn’t care”. Let’s
hope that I’m wrong about that too.

Air France flight AF447 was subject
to a series of signals warning that a
number of electronic systems were
breaking down but the Airbus was
specifically designed to fly by wire, i.e. to
minimise any opportunities for human
error and, as one experienced aviator
commented, “The aircraft is too clever
for its own good.”

Unable to take control

This means that the computers
controlling the avionics were commonly
doing something which the crew didn’t
expect and that, when a critical point
was met in this process, the crew were
unwilling or unable to take control and
salvage the situation.

The causes of the disaster were
multi-factorial and involved flying
through a vicious thunderstorm with
the possibility that various sensors were
malfunctioning and were feeding
misinformation to the computers flying
the plane.

The crew were capable of
overcoming problems caused by each
factor on its own but would have been
incapable of dealing with the
combination. What makes it worse is
that attention had already been drawn to
the possibility of malfunction in the
pitot tubes which fed false readings of

air speed through to the computer but
neither the companies operating the
Airbus A330-200 nor the European air
safety authorities considered the
problem serious enough to affect

The catalyst for the eventual disaster
was that the Airbus has three “brains”
(computers) – Air
Data Inertial
Reference Units
(Adiru) – and two of
the three Adirus failed
which meant that the
pilots will have had
precious little time to deal with the stream of
data which was signalling impending disaster without knowing which systems
to believe in.

Where is the analogy with veterinary
practice? We have all been told that we
shouldn’t believe snapshot data – bytes
of data showing business activity at a
single moment in time – but should
look for trends. The veterinary
profession, or at least the small animal
division of the profession, has had
access to its own fully functioning Adiru
in the form of the Fort Dodge Indices
since 2001.

Every quarter, without fail, the FDI
has plopped onto the mat of around
140 small animal practices around the
country. Every quarter, without fail, the
report has shown the data vacuumed
out of the practice management systems
of the participating practices and, after
just three quarters, we were able to
denote trends in business performance.

Ignoring the trend

Of course some trends change
direction, some accelerate and others
simply disappear but one trend has been
staring us in the face since the start of
this data supply and we have wilfully
chosen to ignore it. In 2001 – according
to the aggregated data of these practices
– there were 1,193 active clients per
veterinary FTE presenting at small
animal practice.

Since that time, and without any
change of direction or plateauing of the
data, the number of active clients/FTE
has fallen quarter by quarter until today, where the September 2009 data show us
having 967 active
clients/FTE. This is 0.06%
away from a 19% attrition in the number of pet owners
visiting vet practice and, as the
trend is constant and without
interruption, we should
expect, mathematically,
that this average of a 2%
attrition per year will be
likely to continue.

Let’s play a game. If we
lose just 2% per annum over
the next five years, we will have
fewer than 871 people banging on our
doors in search of our products,
services and skills. Note the deliberate
insertion of the word “just” in the
previous sentence.

Retail data in 2008 showed that
consumer spending on pets was
accelerating rather than falling and that,
while any growth in pet spending
through the veterinary channel was
modest, spending was far more robust
in both the pet and grocery channels.
This is a very straightforward
proposition: consumers are voting with
their feet.

Exclusively clinical

While few of us doubt that pet owners
will continue to bring their broken and
sick animals for attention, the
profession is failing to entice, rationalise
or persuade enough of them to buy
their elective purchases from us. Some
reading this may believe that practice
should revert to an exclusively clinical
business model while others may decide
that the elective purchase is too
important to practice dynamics to let
the attrition continue unchecked.

Either decision would need to
engender a change of veterinary
behaviour and a look at the components
of veterinary practice business, as
shown in the FDI, indicates that the
steady attrition of active clients is not
the only dynamic which needs urgent

It is, however, a fundamental one.
How many active clients do we need per
FTE for small animal practice to be
viable? No one really knows because, at
its simplest form, the answer would be dependent on the
amount each active client spends.

Since 2001, the annual transaction
value per active client has risen from
£134.18 to £245.00 but we have to
believe that the consumers’ willingness
for elasticity in spending will not be
infinite. Way back in 2001, a blog
appeared showing that the vast majority
of dog owners appreciated the care and
expertise shown by their vet but the
same percentage felt that veterinary
charges were too high.

No one questions the fact that a
wristwatch can cost £25, £250 or even
£25,000 and there are plenty of people
prepared to pay far more than £25 for a
wristwatch because they can see the
value in that purchase which overcomes
any consideration of price.

The mistake we are making is to
escalate our veterinary costs without
proper and considered attention to how
we explain them and make consumers
both willing and content to justify to
themselves an incremental cost, brought
about by our skills and a level of service,
over what they might have to pay

We are dealing with consumers every
day and yet we fail to learn the lessons
which other retailers have heeded. To sell
effectively to consumers we have to
understand them and think like them.

Without this significant change, I
have no doubt that our veterinary Adirus
will go on signalling fewer and fewer
active clients. Who knows how long we
can continue happily ignoring a set of
flashing lights warning us that veterinary
practice could, just possibly, fall out of
the sky.

Have you heard about our
IVP Membership?

A wide range of veterinary CPD and resources by leading veterinary professionals.

Stress-free CPD tracking and certification, you’ll wonder how you coped without it.

Discover more