Today's Veterinary Business

AUG-SEP 2017

Today’s Veterinary Business provides information and resources designed to help veterinarians and office management improve the financial performance of their practices, allowing them to increase the level of patient care and client service.

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26 Today's Veterinary Business Business How to on a hospital pharmacy profit "Profit is like oxygen, food and water for the body," the authors write. "These things are not the point of life, but with- out them, there is no life. In the same way, visionary companies see profit as a residual of doing things well, not the point of being in business." If you agree with that perspec- tive, then this article is for you. Do- ing the right things to make a profit — not doing things just to make a profit — starts with understanding your customer, because an in- house pharmacy can't be profitable if no one buys from you. Set Competitive Prices What things drive purchase choice? What can market research tell us about where pet owners and other consumers buy and why they buy? How can we use that information to encourage clients to buy their pet prescriptions from us? Market research tells us that most clients believe they will pay more to fill their pets' prescriptions at a veterinary practice than they will if they buy online or at a store. That is why many clients ask if they can purchase heartworm and flea preventives online. This is also true of any long-term medications like arthritis pain drugs and insulin. Consumers are price-conscious. They want the best deal. (Don't you?) Prices are easy to compare online. That means if you want your clients to buy prescription products from you, you have to fight for their business and price "shopped" pre- scription items competitively. Can you make a profit on in-house pharmacy if you price competi- tively? Yes, but you have to work at it differently than you have in the past. And if you are still in doubt, here are two good reasons prescrip- tion sales are worth fighting for: • Quality control. You know that the products you sell come from legitimate phar- maceutical companies and that your clients will receive the right dosage and instruc- tions for safe administration. If anything goes wrong, like a product recall, you have the ability to contact clients and help them work through it. • Good business. Pharma- cy sales represent 25 to 30 percent of revenue in most practices. Why would a prac- tice walk away from that? 5 Key Tips Here are five simple things that veterinarians and their teams can do to encourage clients to fill their prescriptions at the practice and keep coming back: 1 Counter the Perception That Your Drugs Cost More Make sure your clients know that your products are competitively priced, but do it the right way. What you say needs to work with the way clients think. In other words, if you do the right thing but do it in the wrong way, it still won't work. To illustrate, here are two posted signs for you to compare and contrast: A. "Our flea and tick products are market priced. You can take them home today or buy them online from us for convenient delivery to your door." B. "Get safe, reliable heartworm and flea protection for your dog for only $___ per month when you buy a six-month supply. Offer ends August 30. Pick yours up today!" The wording on sign B works the best because clients prefer concrete offers they can easily Be competitive with prices and communicate to clients why they should buy their pets' drugs from you. By Karyn Gavzer, MBA, CVPM One of my favorite business books, "Built to Last," compares companies that have stood the test of time with companies that have gone out of business. Among the discoveries by authors James Collins and Jerry Porras is one that may surprise you. It sums up how companies that last feel about profit. Business

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