Posted Sept. 28, 2016
An AVMA economist said veterinarians can protect themselves ahead of recessions and take advantage of opportunities during such periods.
And an AVMA analyst indicated practice owners, when hiring or evaluating performance, should consider examining how associates will divide their time and how those divisions affect the money they bring into a clinic.
Michael Dicks, PhD, director of the AVMA Veterinary Economics Division, said in a presentation at AVMA Convention 2016 that veterinarians who understand and watch economic indicators may be able to prepare for economic contraction as well as increase business opportunities and income. When they see economic contraction is likely, they can delay large purchases to take advantage of future declines in prices, reduce prices for products in hopes of turning over inventory quickly enough to make more money, and build cash reserves.
Dr. Dicks’ presentation focused on use of signals provided by the Conference Board index of leading economic indicators, published the third Thursday of every month at www.conferenceboard.org.
He also advised that veterinarians pay attention to economic expansion and contraction within their own state and local economies, which can be in periods of recession or growth despite national trends.
||Bridgette Bain, PhD (Photo by Greg Cima)
Bridgette Bain, PhD, a data analyst in the AVMA’s economics division, advocated in another convention session that practice owners think about cost and profit areas within their practices when determining how to compensate veterinarian employees. Her method involved using a worksheet with various compensation amounts assigned for practice areas such as dentistry, wellness, and pharmaceutical sales. It included compensation for activities related to practice promotion, such as customer retention activities and community work.
In one example, she said practice owners should assign different values for performing $100,000 worth of dental work and performing $100,000 worth of wellness visits because of the differences in expenses and profit. In another, she said an associate could be evaluated on the basis of the presence or lack of negative reviews on outside websites.
Dr. Bain also said evaluations related to compensation should include clear, objective measures.