Northington Veterinary Clinic: a new lease of life?

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Northington Veterinary Clinic


a new lease of life?






Introduction


Northington Veterinary Clinic (NVC) is situated on the edge of the city business district of Adelaide, South Australia. Dr Peter O’Connor, the principal and owner, has reached 50 years of age; he is somewhat tired of working full-time and is contemplating retirement. Dr Jim Chew, his associate, on the other hand, is only 30 years of age and needs to work on developing both his career and his assets. Jim is really keen to develop the practice and sees lots of exciting opportunities that can be pursued, but is mindful that the practice has become run down over the years, and that this needs to be addressed before the business can move forward.


Peter and Jim have both returned from their respective holidays eager to look towards the future. Although from two different generations, they are good friends and colleagues and both want the best for the practice (and themselves). They agree that they should sit down together to decide on the best course of action to provide NVC with a ‘new lease of life’.



Background


NVC is housed in an old-style building on a busy road with adequate parking. It has been a veterinary icon in the area for 24 years, with its distinct traditional blue vet sign taking up much of the street frontage aligned with the footpath. In its early days, NVC was recognized as one of the better veterinary practices in the area, with separate operating rooms and expansive cage areas. The waiting room, though small, was bright and well kept. Signage was innovative for the time. However, now the building is looking tired and the signage is old; there is graffiti on the side of the building, giving it an unkempt appearance. There are no windows to the front, just a brick wall with ivy overgrowing the signage, and a standard wooden door for the main entrance.


The small waiting room has four wooden benches attached to the wall. It has been 10 years since the walls were painted. There is a stand with a few shampoos and brushes, none of which are priced, and there is no product information available to clients, bar a few pamphlets on vaccinations. Practice business cards or additional information are rarely provided to clients.


The consulting room walls are painted a traditional white, and there is a stark stainless steel table with painted legs centrally located, and a bench against the wall with a few instruments. All medications are dispensed from the consulting room, including dangerous drugs that are kept in cupboards with doors in need of repair. There is a second consulting room, but this is currently used as a storage area. The preparation area for surgery is small, but the hospital area for holding pets is huge. There is also a surgical theatre that is well lit but is in need of refitting. Unfortunately, the operating theatre has a two-way entry system, causing issues with sterility and airflow. Disappointingly, the theatre has not been upgraded with new technologies; for example, there is no anaesthetic monitoring equipment in place.



External environment



The profession


The ever-increasing use of technology has certainly impacted on the veterinary profession. Veterinarians have to keep up with medical advancement, new drugs, equipment and techniques. Purpose-designed, built and furnished practices are starting to appear along with a new generation of vets. Some parts of the profession realize that a veterinary business is actually like other any business – one that requires management, monitoring, care, financial accountability, marketing and an entrepreneurial approach. Practice managers, until very recently, were brought across and adapted from other professions and businesses, and generally came from a financial management or human resources role. Veterinary practice management courses are now available, and groups within the profession have begun benchmarking against each other.


In the 1970s, legislation for professional advertising changed to allow professionals such as veterinarians, dentists, doctors and lawyers to advertise their business. At first, these professionals were guarded about advertising, essentially due to having no training in marketing. Some veterinarians identified opportunities to develop a competitive edge and entice clientele to their practices. Initially, poor marketing ideas were used. For example, Yellow Pages advertising in the telephone book used to be seen as the ultimate marketing tool. The use of external signage and visual identity was also new to the profession. Murals, neon signs and large print appeared on buildings; some were quite effective, but others were inappropriate or difficult to read. More recently, internet and social media have also become important for brand awareness and advertising, but there is still a wide range of variation in the profession in achieving effective social media presence.



The community


NVC is located in a leafy green suburb 5 km from Adelaide‘s’ central business district (CBD). Northington itself has a population of 36 000 people in 15 000 households, and the population is increasing at 5% per annum. Community land use is predominantly residential, with some commercial areas. The suburb is undergoing a cyclic demographic change. The population was, until recently, predominantly aged, but now 42% of the population is between 35 and 49 years.


Professionals and managers are over-represented in the local area, being 36% and 15.6% of the population, respectively, as compared to 20.5% and 11.4%, respectively, for Adelaide overall. Therefore, disposable income is likely to be above average. The younger people moving into the Northington area are renovating and refurbishing older houses. Although Northington’s population is increasing, the local council is keen to maintain its village and heritage image.


Dog and cat ownership levels are difficult to determine, as dog registration is the only statistic recorded by the council. Estimated figures suggest that only 63% of dogs are registered. The council finds it difficult to administer dog registrations, and the cat population is unknown. There are dog parks, and generally the council receives few complaints regarding barking dogs and dogs wandering at large. The town of Northington has a well-designed Animal Management Plan in place for the next 5 years, which permits a maximum of two dogs per household. Micro-chipping will soon become mandatory for dogs and possibly cats, along with cat registration. Northington Council, in conjunction with a neighbouring vet practice, provides education programmes to the public about responsible pet ownership.



The problem


NVC is in serious need of renovation. When Peter’s parents supported its inception in 1988, the practice was innovative and state of the art. Peter, the practice principal, was enthusiastic and wanted to practise excellent veterinary medicine. He started the practice with just himself and two untrained part-time veterinary nurses. Two years later, he employed Marge, the practice manager.


Peter enjoyed going to conferences to keep up to date with new clinical developments and catch up with colleagues from his university days. When Peter was away, Marge, along with the two nurses and locums, ran the business. However, Peter noticed that while he was away the practice income reduced by half. This prompted Peter to employ his first associate back in 1993.


Dr Jim Chew was employed as a new graduate in 2007. Jim is a progressive, visionary veterinarian with a special interest in orthopaedics and general surgery. Dr Sue Smith subsequently joined the practice in 2010 as an associate, working part time as she has two young children. Sue is a very competent veterinarian, with 8 years’ experience, and has a special interest in feline medicine and pocket pets. Peter, the owner, while an average all-round clinician, has run the practice over the years with ‘peaks’ and ‘troughs’ of energy. However, over time, the ‘peaks’ have become smaller and the ‘troughs’ have become bigger.


Marge, the practice manager, has always been very keen on her role but it was clear from the very start that she lacked skills. For example, she is strong in financial reporting and administration, but somewhat deficient in human resource management. Marge believes continuing education is a waste of time for nurses and that the only skill a nurse should have is a good holding technique so that the vet does not get bitten!


Hayley and Fiona are full-time veterinary nurses in their mid-twenties, each only at the level of the first Certificate of Veterinary Nursing. Fiona is the newer of the veterinary nurses, having been with the practice for 12 months. There has been little encouragement to undertake further training in veterinary nursing, and the nurses have limited personal motivation to do so. Their main job description is to answer the telephone and to clean. This frustrates the two younger vets, who try to encourage an ethos of good practice protocols.



A taxing time


Late in 2012, Peter was audited by the taxation department for not paying Goods and Services Tax (GST), but in fact it was Marge who had not done so. Peter received a $12 000 fine and now has to pay back payments of $53 000 to the taxation department. Small amounts of money have also gone missing. A daily reconciliation of transactions is kept but it rarely balances. Different clients come in each month, as they have been getting accounts in the mail, but claim that they have already paid (see Tables 15.2 and 15.3).


Although he is the practice owner, Peter does not consider details such as the income statement, fee schedules, staffing budgets and service reports as important. As long as there is a small amount of money in the bank to support his annual holiday and conference then he is satisfied. However, the clinic’s income has plateaued over the last 18 months, and since the taxation debacle cash flow has been especially poor. Fortunately, Marge maintains the debtors, creditors and general ledger systems adequately for extraction of information to go to both the accountant and, on occasion, into a practice benchmarking service. This practice benchmarking service enables a practice to compare its key financial performance indicators to other similar Australian veterinary practices. NVC’s software program also allows further custom reports that include further species and transaction analysis (see Tables 15.1–15.8 and Figure 15.1).


Related posts:

  1. Introduction
  2. De’Ath, Slaughter, Davis & Jones, MsRCVS: time for a rebrand?
  3. Applying marketing theory to veterinary practice
  4. Ellie Prior: starting out in practice

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Oct 9, 2016 | Posted by in GENERAL | Comments Off on Northington Veterinary Clinic: a new lease of life?

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