Business is starting to look up: New data on revenue, invoices
As the national economy works at recovery, the veterinary practice sector is showing positive signs. We aren’t out of the woods yet, but today’s Chart of the Month shows that practice revenues and billing are not only back to pre-COVID-19 levels nationwide, but revenue growth is even stronger than before.
According to the industry tracker made available by VetSuccess, revenue and invoices both dipped sharply in March, reached their lowest points late that same month, and have been moving steadily upward since early April. There are variations regionally and state by state, but the lines on the chart indicate that the national veterinary sector has rebounded as well as we could have hoped at the start of the pandemic.
A few key points:
- The chart shows year-over-year data, comparing 2020 revenue and invoices with 2019. Despite the severe drop in March, practice revenue and invoices are now up from last year’s levels.
- Since early May, revenue is trending above pre-COVID-19 levels, which were in the 8% range for year-over-year growth.
- For the last two months, revenue has averaged around 14% higher than 2019. The recovery for invoices has been softer, but these also continue to rebound. Currently, average practice revenue is up 15-25% year over year, depending on location.
- Note the V-shaped line of the data. This is the recovery pattern we hoped for after the sharp economic drop-off at the start of the pandemic.
What’s behind the rebound?
There are several reasons for the strong veterinary recovery so far:
- Because veterinary care was designated an essential service, it never hit sustained rock bottom like other sectors, such as dentistry or optometry.
- Some consumers have had increased disposable income, from stimulus payments and/or higher unemployment payments (which have ended).
- Pent-up demand for veterinary services built up during the height of the lockdowns. (This will eventually subside.)
- Pet adoptions have increased in the pandemic, although not at the skyrocketing levels suggested by anecdotes.
- Owners spending more time at home with pets has meant more demand for veterinary care – a trend we hope will continue because it means better healthcare for patients.
Solving new challenges
While a surge in business is good for practices, it’s also introducing new challenges as practices work hard to manage the demand. Veterinary teams are stretched thin, trying to manage the impacts of COVID-19 both at work and at home. Burnout, stress, and compassion fatigue are very real concerns.
Consider these approaches to increase support for team members and find new efficiencies to reduce workload and stress:
- Develop operational guidelines to streamline new protocols like curbside care, social distancing, remote payment, and telemedicine. Resources in AVMA’s COVID-19 Resource Center can help, including advice to keep teams healthy, a case management decision tree, triage flowchart, employee health screening template, and telemedicine tools.
- Encourage team members to discuss challenges openly and offer ideas for improvement. Great ideas can come from any team member, and our teams want to know that we welcome their input.
- If a daily team huddle isn’t part of the regular routine, consider adding one – and use it to listen to the team and build an understanding of what they need. This can be an effective way to build team rapport and engagement.
- Make sure you’re leveraging your whole team, especially veterinary technicians, according to their skills and training. Optimize their contributions whenever and wherever possible.
Resources to draw on
Communications during COVID-19: Get tools and best practices for communicating with both clients and team members.
Team-building tools: Find templates and customizable planning tools for planning effective team meetings, training new employees, giving feedback, and more.
Webinar – Reimagine and prepare for the next normal: Make a deeper dive to explore what the post-COVID economy might look like, and get practical advice to plan for your business. (CE credit: 1 hour)
Financing during the pandemic: Use this downloadable checklist to evaluate your current operation, imagine where you want to go, and plot a roadmap to get there.
Learn more about how COVID-19 has affected veterinary medicine and what strategies are helping practices continue to build strong client relationships. Attend the 2020 AVMA Economic Summit, October 26-28.
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