PRACTICE OVERVIEW KPIs
Please note that unless otherwise specified, the period these KPI’s refer to is the last (most recent) completed financial year. If financial information for that period is not yet available, you will need to revert to the most recent completed financial year prior to that.
Normalised Net Profit %
The net profit of practices is so often miscalculated and misrepresented that, at the risk of adding some complication to your work, we feel it important to get this spot on. For a true comparison of profitability, a number of adjustments need to be considered (beyond those listed on your spread sheet) and these come under the following categories;
- Principal/s Salary Adjustments
If the principal/s salary is more or less than the deemed market rate, an adjustment needs to be made. This salary should be appropriate for any clinical or administrative work the principal/s are performing for the business. The definition of a true market rate for a principal varies but we will deem it to be $150,000 PA. This applies to averaged 38 – 50 hours per week work in and / or on the business. If you work less or more than this range let us know and we will help you make an appropriate adjustment.
- Principal/s Superannuation Adjustments
If the principal/s contributes more or less than 9.5% of the deemed market rate salary for hours worked please add back or remove this from the profit.
- Rent Adjustments
If you own your practice building/s and are not paying a local market rental rate for commercial premises fitted out and zoned for medical use,
please make an adjustment. If you are not sure on what the market rate per m2 should be, please contact a local real estate agent that handles commercial leases in your area for advice.
- Stock/COGS adjustments
If you receive a wholesaler’s discount, product rebates, or rebates on any other elements of COGS (e.g. external pathology/cremation/oxygen) with the
option to receive either a discount on the bill or the equivalent as personal
benefits and you choose the latter, please add the equivalent amount back to profit.
- Debtor Adjustments
If debtor amounts stay more or less the same year to year then no adjustment is necessary. If they have fluctuated significantly, an appropriate adjustment should be made i.e. for increased debtors reduce profit and decreased debtors increase profit.
- Business Loan Interest, Equipment Leases and Depreciation
An adjustment should be made for any interest you are paying on loans for the business if you have them, equipment/work vehicle leases and depreciation for eligible items i.e. these should be added to the profit.
- Low Value Equipment
If your accountant applies the faster, small business rate of depreciation to low value items, an adjustment should be made i.e. add this to the profit.
- Personal Expenses
Adjustments should be made for any personal expenses run through the business such as private vehicle use, groceries, utilities not related to the business, travel etc. If these are unrelated to the running of the business these all need to be added back to the profit. If you have engaged in personal development unrelated to the business that is listed as a staff training expense, this should be added back also.
Growth in Profit %
Self-explanatory. Please express as a percentage (not dollars), the increase or decrease of the total profit amount from current completed financial year compared to previous completed financial year. If profit has reduced year to year, please express the figure as a negative percentage. Result should be entered as a percentage not a decimal e.g. 10% not ‘0.1’
Example of Growth in Profit % – if normalised net profit for the previous year is 10% and normalised net profit is 20% in current year, this would represent a 100% Growth in Profit.
Annual Turnover $
Remember all turnover/revenue is considered excluding GST.
Number of full-time Equivalents
Refers to the number of full-time equivalent veterinarians in your practice for the period. The easiest way to calculate this is look at your payroll information, add up the number of hours worked by vets in your business, add in the clinical hours worked by the owner (that are not already detailed in payroll) as well as any locum support provided.
To get FTE number, divide this figure (total vet hours) by the hours for
the same period that one vet working 38 hours per week would have worked.
Assuming 4 weeks annual leave a year, this equates to 1824hrs (48 x 38 = 1824 hours).
Growth in Turnover %
Please express as a percentage (not dollars), the increase or decrease in turnover from current completed financial year to previous completed financial year. If turnover has reduced year to year, please express the figure as a negative percentage. Result should not be entered as a decimal e.g. 10% not ‘0.1’
Example of Growth in Turnover % – if turnover for previous year is $1M and turnover for year 2 is $1.5M, this would represent a 50% Growth in Turnover.
STRATEGIC PRICING: BROAD FEE STRUCTURE DETAILS
Please base all fee structure details on current values in your practice as opposed to last calendar or financial year. Please note all fees are to be presented INCLUSIVE OF GST.
Dispensing fee, injection fee, s4 mark-up
Dispensing fee pre-packaged refers to items like ear meds, eye meds, skin meds that do not require counting or packaging. The rest should be self-explanatory.
Does this apply to all S4s (Y/N –> if not, which)
Some practices have custom mark-ups for certain items – particularly high-cost medications. Please indicate if your mark-up varies and if so for which products.
If you do apply the same mark up to all your S4 drugs, please enter Y
If you do not apply the same mark up to all your S4 drugs, please enter N and click on the link to the S4 Markup exceptions sheet to enter this data
Other mark-ups
Self-explanatory.
STRATEGIC PRICING: DETAILED FEE ANALYSIS
Please base all fee structure details on current values in your practice as opposed to last calendar or financial year. Please note all fees are to be presented INCLUSIVE OF GST.
Consult Fee S.A. Standard
Fee charged for small animal, standard length consultations i.e. the most frequently booked consultation.
Consult Fee S.A. Extended
Fee charged for seeing small animals, in an extended length consultation e.g. skin, second opinion etc if this exists in your practice. Enter n/a if not applicable.
Consult Fee S.A. Revisit
Fee charged for seeing small animals for revisit/re-examination consultations.
Consult Fee S.A. After Hours
Fee charged for seeing small animals for an after-hours consultation (various time periods):
- Until 10pm
- 10pm- 12/1am
- 12/1am – morning
Consult Fee Behavioural
If you do them, enter n/a if not applicable.
House Call Consult Fee
Small animal house call including any surcharges (if applicable) and travel time up to 20 mins one-way.
Consult Fee L.A.
Fee charged for large animal, standard consultation, including any travel time, If small animal practice only, enter n/a.
Revisit Consult Fee L.A.
Fee charged for large animal revisit consultations including travel time. If small animal only practice, enter n/a
After-hours Consult Fee L.A
Fee charged for large animal after-hours consultations including travel time. If you charge different fees for different times at night, enter the most expensive amount.
Travel Fee LA
The Dollar amount you charge per kilometre travelled. Enter n/a if none exists.
Microchip (standard)
In instances where you utilise a registration service other than the free local government service, exclude this amount from the total you provide.
Proheart SR12
Enter the cost of Proheart SR 12 provided to a dog that weighs:
- 5kg
- 10kg
- 20kg
- 30kg
- 40kg
Blood Collection Fee
The fee charged to cover the cost of drawing blood, staff to restrain the animal and consumables. Enter n/a if none exists.
FNA and Cytology (including sampling, prep and analysis)
Cost of an in-house fine needle aspiration of a mass including sampling, preparation and analysis.
Smear and Cytology (including sampling prep and analysis)
Cost of an in-house ear smear and cytological examination including sampling, preparation and analysis.
Pre-anaesthetic Blood test (including collection)
PABT plus any fees associated with collection if applicable. As inclusions can vary massively please provide notes in the adjacent field on the excel sheet if more than a mini biochem profile (e.g. Idexx PAP) plus a PCV/TP is performed. Please include a collection fee if one is normally charged
MBA/GHP and CBC (including collection)
Multiple biochemistry analysis or “General Health Profile” plus a complete blood count including any fees associated with collection. For the purpose of this survey, do not include electrolytes if they would incur an additional fee to be run. Please include a collection fee if one is normally charged.
If the fee incorporates a bundled charge for discussing results with the owner, please exclude this charge.
Hospital Ward Fee Dog
The fee applied for patients that are in hospital that are primarily there for something other than medical treatment. You may have a different name for this fee, e.g. hospital short stay, hospital procedure. Essentially the ward fee is charged for admitting and keeping a dog in hospital for the day if they are having a routine procedure. e.g. minor surgery, diagnostic procedure, dentistry or grooming. This fee is different to the day hospitalisation fee which is charged when a dog is in hospital for the day requiring medical attention.
If in lieu of a ward fee, you charge a day hospitalisation or 24-hour fee, enter that fee instead. If you don’t currently charge a fee for this, enter n/a
Day Hospitalisation Fee Dog 20kg
The cost of hospitalising a sick dog requiring medical treatment, just for the day (not overnight) – if possible, please present the fee purely for hospitalisation i.e. exclude any daily re-exam fee, fluid maintenance fees, consumable fees. If this fee does not exist indicate n/a.
Overnight Hospitalisation Fee Dog 20kg (standard 24 hours)
Cost for up to 24hours standard hospitalisation including overnight. If possible, exclude any ancillary in-patient charges such as daily examination fee, consumables, waste disposal etc. If this fee does not exist, enter n/a.
Intensive Care Hospitalisation Fee Dog 20kg (24 hours)
Self-explanatory, enter n/a if none exists. If possible, exclude any ancillary in-patient charges such as daily examination fee, consumables, waste disposal etc. If you charge an hourly fee, please do not include it, please enter your hourly fee in the field below, Intensive Care Hourly Fee Dog 20kg.
Hospital Ward Fee Cat
The fee applied for patients that are in hospital that are primarily there for something other than medical treatment. You may have a different name for this fee, e.g. hospital short stay, hospital procedure. Essentially the ward fee is charged for admitting and keeping a cat in hospital for the day when they are having a routine procedure, e.g. minor surgery, diagnostic procedure, dentistry or grooming. This fee is different to the day hospitalisation fee which is charged when a cat is in hospital for the day requiring medical attention.
If in lieu of a ward fee, you charge a day hospitalisation or 24-hour fee, enter that fee instead. If you don’t currently charge a fee for this, enter n/a.
Day Hospitalisation Fee Cat
The cost of hospitalising a sick cat requiring medical treatment, just for the day (not overnight) – if possible, please present the fee purely for hospitalisation i.e. exclude any daily re-exam fee, fluid maintenance fees, consumable fees. If this fee does not exist indicate n/a.
Overnight Hospitalisation Fee Cat (standard 24 hours)
Cost for up to 24 hours standard hospitalisation including overnight. If possible, exclude any ancillary in-patient charges such as daily examination fee, consumables, waste disposal etc. If this fee does not exist, enter n/a.
Intensive Care Hospitalisation Fee Cat (24 hours)
Self-explanatory, enter n/a if none exists. Exclude any ancillary in-patient charges such as daily examination fee, consumables, waste disposal etc. Self-explanatory, enter n/a if none exists. If possible, exclude any ancillary in-patient charges such as daily examination fee, consumables, waste disposal etc. If you charge an hourly fee, please do not include it, please enter your hourly fee in the field below, Intensive Care Hourly Fee Cat.
Daily Inpatient Exam fee
A separate fee is often applied to cover the costs of nurse/vet examinations of inpatients that occur with each subsequent day they stay in the hospital. If this is not charged separately to your hospital fee please enter n/a.
IV Fluids Surgical (during procedure including setup)
Fee for elective I.V. fluids during the course of a procedure under anaesthetic. If this is a mandatory component of all anaesthetics in your practice and the fee is itemised, please include that fee. If not, please enter n/a.
IV Fluids (including setup)
Fee for setting up and maintaining IV Fluid Therapy for the first day in hospital. Please don’t include any additional fees – purely the cost to place a patient on IV fluids on day 1.
IV Fluid Daily Maintenance Fee
A daily fee for maintaining the IV fluid delivery is often charged separate to the initial set-up fee for additional days in hospital i.e. covers nurse time, flushes, redressing, infusion pump use etc. Mark n/a if none exists.
IV Fluid Additional Bag
Fee charged for additional 1 litre bag of standard fluids when required if not included in a daily maintenance fee. Where the fluid bag is included in the daily maintenance fee and is itemised, please enter that amount.
General Anaesthetic (20 minutes)
Assume standard pre-med, IV induction and up to 20 minutes Isoflurane gas for a 20kg dog. If there is an itemised fee for the IV Fluid in your general anaesthetic fee, please deduct it.
Sedation (minor procedure/examination)
The cost of sedating a 10kg dog for a minor procedure/examination. Please also include the cost of the sedative drugs if these are charged in addition to the sedation fee.
Surgery rate per hour (standard)
Self-explanatory.
Surgery rate per hour (orthopaedic & complex soft tissue)
Self-explanatory.
Theatre Fee (standard)
Theatre fee for standard surgical procedures. E.g. lumpectomy
Radiographs (2 plates excluding anaesthesia)
Cost of taking 2 views (2 separate exposures), excluding any fees for sedation or GA. If all x- rays are taken under sedation or GA – please deduct a proportionate amount for this from the total price.
Ultrasound Abdomen (excluding anaesthesia)
Cost of performing a complete abdominal ultrasound (an examination of the entire abdominal cavity). This is to exclude the cost of any sedation or GA. If you have a package price where sedation and GA is not itemised, please deduct the according cost from the original fee.
Dental Radiographs (full mouth)
The cost of taking dental radiographs of the full mouth excluding anaesthesia. If your prices differ for cats and dogs, please provide fee for dogs only.
Dental Grade 1 Scale and Polish Dog
Fee for scale and polish for 20kg dog with Grade 1 dental disease, including GA and excluding any extractions. As standards vary from practice to practice please exclude pre-GA bloods, fluids and dental radiographs if possible. Please indicate in your notes if this does include radiographs.
Dental Grade 1 Scale and Polish Cat
Fee for scale and polish for cat with Grade 1 dental disease, including GA and excluding any extractions. As standards vary from practice to practice please exclude pre-GA bloods, fluids and dental radiographs if possible. Please indicate in your notes if this does include radiographs.
Euthanasia and Standard Aftercare Cat
In-house euthanasia including burial or non-individual cremation.
Euthanasia and Standard Aftercare 20kg Dog
In-house euthanasia including burial or non-individual cremation.
Environmental Levy (or similar)
Fee to offset the cost of sharps and biological waste disposal as opposed to bodies, discarded tissues, bloody swabs or anything which is not appropriate for general waste.
VET REVENUE BENCHMARKS
Accuracy for these benchmarks will be greatest if you aim to calculate your data over the last 12 months. For team members that have been with you for less than 12 months you may need to extrapolate from the period they have worked. Please see the data tips sheets for greater detail on how you might extract this data from your VBMS.
Pro-rata Full-time Equivalents (PRFTE)
To permit accurate comparison with national benchmarks and to allow for typical variation in hours worked by employed vets we will normalize many parameters to pro-rata a full-time equivalent employee per year.
To do this; divide the typical hours FTE would work in your business (assuming 38hrs per week and 4 weeks annual leave a year i.e. 48 x 38 = 1824 hours) by the actual hours worked by the individual. Then apply this ratio to the parameters you measure. Where possible, unless otherwise stated, please measure these parameters over the preceding 12-month Calendar period.
If the employee has not worked with you for an entire year extrapolate what the resulting hours would be over a 48-week period based on their number of hours worked to date.
If you are getting data from profit Diagnostix, FTE is in hours not opportunities.
Average Transaction Fee per Vet
Calculate the average transaction fee for a full-time equivalent vet in your practice. If this individual does mostly surgery, please indicate this in your notes.
NB: Please present this dollar value exclusive of GST
Veterinary Fees Generated: Veterinary Salaries Ratio per Vet The 5:1 rule applies to this
statistic.
“Veterinary Fees” Please include veterinary specific services and veterinary medications provided in the course of veterinary work. Ideally exclude non-veterinary services e.g. grooming and unrelated merchandising and/or OTC unrelated to clinical service.
NB: Please present this dollar value exclusive of GST
“Veterinary Salaries” include wages, bonuses, fringe benefits (e.g. car) and super. Include ‘true market rate’ adjustments for clinical work done by owner/s not already included in payroll: for this benchmark we use pro-rata $100,000 per 38hr week plus super.
For the most accurate result calculate this fee for each individual vet over the last 12 months in your practice (or less for new employees)
“Transactions per Vet PRFTE /year”
Number of transactions per vet PRFTE /year excluding any zero invoices. Total Earnings per Vet PRFTE/year. Total revenue generated per vet PRFTE /year.
NB: Please present this dollar value exclusive of GST
Total Earnings per Vet PRFTE/year
Total income generated per vet PRFTE /year.
NB: Please present this dollar value exclusive of GST
VET SALES BENCHMARKS
If you are not already monitoring the following benchmarks, this data will need to be collected looking forward ideally over the few months prior to the data submission date. Please see the tips sheet for more detail on how these can be produced using your VBMS.
Please note it is critical to start work executing the collection of these figures as soon as possible.
Estimates Given Per Opportunities
This benchmark serves several purposes. Firstly, it helps measure how often your vets are recommending procedures and assesses that relative to the actual number of opportunities to do so in a certain period. The more aligned with gold standard practice the vet is, the higher the number of procedure recommendations tends to be. This parameter is also important when assessing team members’ ability to convert these recommendations into sales (see below).
“Opportunities”
For the purpose of our benchmarking we will deem “opportunities” to be the main occasions where vets might recommend a procedure to owners i.e. First consult, revisit consult, final vaccination, annual vaccination.
The number of opportunities will need to be calculated for each individual vet for the period being assessed. As opportunities vary dependant on the full-time or part time and regular shifts worked, this helps make an assessment of recommendations and conversions.
“Procedures”
We will deem “procedures” as any medical, surgical or diagnostic work that involves admission of the patient. We will exclude any procedures that are performed by the vet during a consultation as these should be captured in the other individual vet performance parameters.
“Estimates Given”
Ordinarily recommendation of a procedure will involve the provision of an estimate; either provided in writing or in the case of an immediate admission this may be, as a minimum, a verbal estimate that is referenced in the consent form and patient history.
If no specific reporting function exists in your VBMS to directly measure estimates given a basic system to measure can be created; create a zero cost invoice item titled “Estimate given” and ensure your vet team enter this whenever a procedure is recommended. This will serve as a marker you can search for to provide a measure of estimates given for each individual vet.
Conversion of Estimates (%)
This is an equally powerful parameter that assesses a veterinary team member’s ability to have the procedures they recommend to owners actually booked-in and performed for the patient. In effect we are assessing the individual’s ability to close the sale.
The way to calculate this percentage is by comparing the estimate a list of actual procedures performed (or booked to be performed) to the list of the estimates given for the period being assessed.
NOTE: While performing this measurement, you can simultaneously generate a list of Estimates Given but Not Converted. A highly beneficial exercise is to have this list generated regularly and provided to vets and/or support staff to follow up with phone calls to the clients.
SUPPORT STAFF SALES BENCHMARKS
As with the vet sales benchmarks, if you are not already monitoring the following benchmarks, this data will need to collected looking forward ideally over the few months prior to the data submission date.
Please see the tips sheet for more detail on how these can be produced using your VBMS.
Phone Call Conversion to Consult (%)
Regular primary consultation bookings are one of the keys to having a successful veterinary business. One of the many key functions of support staff, in particular the reception team, is to field new phone enquiries regarding sick pets and arrange for them to have a consultation with a veterinarian.
Using a phone log, makes it possible to measure the ability of your support staff to convert enquiries to a consultation. This parameter can help identify if team members need additional training or scripting to assist them with making consultation bookings.
You are welcome to use the Phone Log template provided to you by Lincoln for this.
De-sexing Enquiry Conversions (%)
While de-sexing procedures aren’t generally the most profitable procedure in veterinary practice they are an excellent opportunity to bond with a client and often lead to additional services being provided. De-sexing enquiries can prove a greater challenge to convert to a booking as there is less urgency, competition is generally tight and as a result this service is routinely price-shopped.
Measuring de-sexing enquiry conversions can give a strong indication of a support staff member’s ability to sell procedures generally and also whether additional training and scripting around de-sexing would be beneficial. Using your phone log is the key to measuring this KPI. Please refer to the Phone Log template provided by Lincoln.
Counter Sales per hour Reception ($)
This parameter is a measure of support staff member’s ability to sell things other than services while working on reception. As practices might have dedicated receptionists and/or nurses who rotate through reception the best way to normalize this parameter is to divide total counter sales ($) by hours worked at reception for the period assessed.
Once again, measuring counter sales can give a strong indication of a support staff members ability to sell generally and also whether additional training and scripting around product and food sales would be beneficial.