Veterinary practices are businesses. They provide a valuable service to customers and generate revenue from that service. Yet, in some respects, veterinary practices operate differently than many other types of businesses. They prioritize animal health and wellbeing and serve clients who have extremely strong emotional attachments to their pets. They also emphasize preventative care, operate under stringent regulatory standards, and offer specialized medical services, often requiring flexible hours and skilled professionals. 

These unique differences require a unique look at certain data points that can make a significant difference in growth and profitability—two key measures to review regularly. We’ve compiled some tips and tricks for measuring and monitoring growth and profitability through both client list and inventory data.

Client List Data

Running regular reports on new clients is essential to measure the growth of the practice. Not only does it allow you to track growth month over month, but it helps you to look back over the prior year and see any seasonal times where new client growth was higher than usual. This is an effective way to monitor responses to marketing campaigns or any other activity in the market that may be sending more clients your way. 

The more filters you put in place, the more restrictive and focused the report. Here are some tips to use in NaVetor: 

  • Manipulate dates in the Client List Report to show new clients coming into the practice during the set window of time specified. 
  • For a full list of clients, filter by the start and end dates. The start date is typically the date you converted to NaVetor. 
  • For a month-over-month view, simply use the start date and end date for that particular month. 

Inventory Data

Inventory data provides a wealth of information about practice health and profitability. Here are just a few inventory reports worth monitoring regularly.

Inventory Consumption Report

The Inventory Consumption Report shows what inventory was consumed during the date range specified, including seasonal peaks from the prior year. This will give you an idea of how much to order in the current year during the same time, so you have enough product on hand to sell. More sales means more profitability (if you’ve priced the items right!).

Tip: Specifically review quantities during the busiest seasons of the prior year, such as heartworm medication consumed during the prior spring heartworm season. 

Inventory Stock Alert Report

This report shows any products where the inventory levels are below the minimum threshold. Keep in mind that letting levels get too low may mean rush ordering and rush charges, which inevitably eat away at profitability. Regularly reviewing this report and ordering products approaching the minimum threshold can help replenish those lost dollars.

With NaVetor, the eShelf integration makes it easy to ensure costs are always accurate when ordering products. You can send orders in and receive them electronically, simultaneously updating your costs and your quantity on-hand. When the inventory is set up properly, as those costs increase, your selling price will also automatically increase. 

Tip: Make sure the setting within the integration section is set to turn on this specific integration. 

Productivity by Item Report

Surprisingly, selling a product for less than it costs occurs somewhat frequently in practices, especially in those that don’t regularly review pricing. Vendors and manufacturing companies raise prices periodically to cover their costs, and if your fee schedules aren’t set up properly, you could accidentally sell a product for less than what you paid for it.

With this report, you can review products by item to determine how many have sold, and for what price. Having that information allows you to determine if you are selling products for less than your cost. 

Tip: Make sure your margins are high enough and that your shipping costs are covered in your price-setting equation. Setting your fee schedule for a set percentage increase rather than a fixed cost will allow your pricing to fluctuate based on your cost. 

Profit Analysis Report

When adding or updating an inventory item, make sure to assign it to the proper category. This is helpful for running reports by product category (pharmacy, vaccinations, etc.). Billing categories can be customized and even match the AAHA chart of accounts (if you’d prefer to have your accounting match the AAHA standard). 

If categories are set up correctly, the Profit Analysis Report will show you which products are most profitable—not to mention how much money is walking out the door. This is also an opportunity to discover if any of those products are tied into a flat-fee bundle. 

Tip: Ensure that any price increases on inventory (due to cost increases) are also reflected and recalculated in flat-fee bundles. 

By focusing on just client lists and inventory alone, you could significantly increase the growth and profitability of your practice. NaVetor consolidates this important information into a single-view, easy-to-use dashboard, to help you evaluate that growth even faster. Happy reporting (and listening!).