Where to Put a Veterinary Practice – Podcast

Where to Put a Veterinary Practice – Podcast

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Show Notes:

Session 29: Veterinary Locations


Hello, this is Scott McDonald and welcome to the Perfect Place to Put a Practice Podcast.  In this session, we are going to deal with the specific demands of where to put a veterinary practice.  The guidelines for the successful placement of a practice of this type is unlike any other kind of practice.  In our experience, it is more like placing an urgent care facility or surgi-center than anything else even though the rules and guidelines are unique.  Fortunately, there are some great resources to help inform the veterinary practice owner on what location will work best.

We have to start with the presumption that veterinary practices are not only different from other healthcare practices but they are different from each other.  The reason for this is straight forward.  Each veterinary practice has an emphasis that is a reflection of the doctor’s vision of practice.  The vast majority of veterinary practices fall into the “small animal practice” category.  This usually involves an emphasis upon household pets like dogs and cats.  There is an occasional pocket pet, exotic, or avian case but these are the exceptions rather than the rule.  Nevertheless, I have worked with practices that have an emphasis upon each.  As expected, each of these will depend heavily upon the census of animals that would fall within their prevue.  Therefore, the biggest priority in finding a place for these practices is a large population of pocket pets, reptiles, and birds. 

Different priorities for sites that make large investments in equipment and procedures will depend upon other demographic factors.  Almost all veterinary practices have some surgery component and at least rudimentary diagnostics.  The majority offer wellness programs such as diet and emergency treatment of some type.  On the other hand, there are offices that go beyond these services and the regular range of services.  These variations on practice seem to be greatest in terms of two factors: 1. extensive diagnostic equipment such as ultra-sound, digital radiography, and on-site laboratory equipment and 2. treatment options that can range from dental, prosthetics and genetic testing.  Practices that perform orthopedic surgeries such as joint dislocations, patellar luxation, and hip dysplasia fall within this category and their demographic priorities are different.  Rather than depending upon a large number of specific animals, they have to have a significant “accessibility” factor they must consider.  In other words, there have to be a large number of pet households with high disposable incomes that have reasonable access to the site (usually calculated at 30 minutes or less).  For this reason, they have to look at a subset of the pet owning population that has specific demographic characteristics.

We also note that practices that want to provide services such as kenneling, breeding, physical therapy, and training are going to need facilities that are quite different from the average.  One can offer microchipping almost anywhere.  Vaccinations, spay and neuter services, and even euthanasia can be offered in very small office settings in retail locations.  But there are many services that require special equipment for diagnosis and treatment that will have an impact upon where such services can be reasonably offered.

Obviously, large animal practices are going to require locations and equipment for equine and bovine care that are extremely different from small animal practices. In these practices, the issue seems most often to be locating an office where animals can be brought but also close enough that the doctor can get out the field in order to perform treatments in a timely manner.  Taking 20 hours to get to an expensive animal for an energency c-section is probably not going to work.  In this case, accessibility is another major issue for practice location.

The point is, while veterinarians may have similar training, the services they offer can be quite unique and highly specialized.  In some communities, we are seeing the emergence of true veterinary specialties that will seek referrals from other veterinary hospitals.  At one time, these were reserved for veterinary training programs.  Now, they seem to be springing up in locations far away from universities.  Nevertheless, it seems from our experience to be a tiny percentage of the overall veterinary market but one that will increasingly want to consider demographic market recommendations and analysis. 

With all that being said, we believe that the first step in choosing a place for most veterinary practices is to determine range of services the veterinarian wants to offer.  There are so many physical necessities in determining a place to practice that this is the to start: with basic needs of the practice.  Keep in mind, some cities and counties restrict available areas in which a veterinary practice can operate based upon some of these services.  For example, noise restrictions apply to kenneled animals in some locations. Additionally, there are waste-disposal (including bio-waste) restrictions that can be very strict especially in urban environments.  Therefore, we have to take serious look at what the facility or hospital is going to offer by way of care and in terms of volumes and also take into account what locations are legally restricted based upon those services.

This is not the process we apply when it comes to other types of healthcare practices. There, the primary consideration is the demographic character and psychographic habits of consumers.  When this has identified, we can then seek locations that will support the practice.  As an example, dental practices are so standardized in their offerings that it is possible to evaluate an office site based only upon competition and demand alone.  In veterinary medicine, proposed services start the process.  It was not always this way.  Previously, veterinarians were mostly generalists and had far less variation between practices.  Within the memory of many practicing vets, locations were considered only upon the basis of competition.  That is not to say that competition is unimportant.  But it should be noted that as subspecialties have proliferated and market positions of practices (along with branding of offices), mean that not every veterinarian is really a competitor.

To illustrate this point, a practice that offers special services for “show dogs” who handles breeding and grooming for competition, is not going to be in competition for a “cat only practice.” There will doubtless be cross-over in services with other animal hospitals.  Nevertheless, their services will tend to attract a different customer base. On this issue of competition, we want vets to keep in mind that being located in a region with other practices is not the kiss of death.  This is true even when similar services will be offered in other hospitals.

When we examine the viability of a location, we always want to provide an objective contrast (not a comparison) between our client’s location and those of his or her colleagues as well as much insight as possible to gain regarding what they are saying.  We evaluate (in order of importance):

  1. Target market (who is being attracted based upon advertising)
  2. Messaging (what is the biggest reason that this practice is telling people that this should be their office-of-choice).
  3. Accessibility (the size of the population of households with pets in a drive-time radius)
  4. Visibility (how many people can see the location during their “life-traffic” times of the day)
  5. Population of pets
  6. Psychographic characteristics of frequency of veterinary visits and how much they spend

The first four items can be measured based upon first-hand research. Anyone can gather this information although evaluating it can be tricky.  We are fortunate enough to have looked at hundreds of veterinary locations and evaluated thousands of offices. Most individuals don’t have that kind of perspective.  Still, it can be gained by doctors who are willing to seriously look at the areas in question.  Our recommendation is to take the point of view of a marketing consultant rather than a competitor (which may tend to make critical).

When it comes to the last two items, we have found that several companies offer a “Pet Potential Index” that lists a statistically reliable count of dogs, cats, and birds broken out by either drive-time or circle radius. Additionally, these indices will provide valuable data on the behavior of pet owners in terms of seeking care from veterinarians.  For example, they will often provide the amount spent by these pet owners on veterinarians, the frequency of their visits, and other important facts.  Just keep in mind, an index usually measures a local area against a national or state-wide standard. Therefore, if the number 100 comes up, it means that this area is like the national pattern.  Above that number shows a greater propensity toward that pattern.  Below it will show a lesser propensity.  Just keep in mind that the geographic area should be large enough to reflect the real practice area for the average veterinary practice.  This is usually defined as between a 5-minute drive-time and a 10-minute drive-time.

On a last note, I am not sure that services like ours are as important because they provide the numbers and metrics you want to know.  I think the reason you go to a demographer and market analyst is to interpret the numbers and trends based upon their experience in look at how these numbers will affect the practice.

This is Scott McDonald for the Perfect Place to Put a Practice.  You can learn more about us by visiting our web site at DoctorDemographics.com.  And thanks for listening.