For generations, veterinary professionals hung the proverbial shingle and delivered services all by themselves. This sole-practitioner business model was prevalent in various types of practices — companion animal, food animal, equine and mixed. However, as the workload, client expectations and the challenges of operating a business grew, the owner hired associate veterinarians. The group practice model began to develop.
According to the American Veterinary Medical Association, one-doctor businesses represented about 38% of all practices in 2023. While the current trend favors larger practices, smaller hospitals continue to do well. But will that always be the case? What is the future of the one-doctor practice?
The Same But Better
Focusing on what small hospitals do exceptionally well compared to their large competitors provides clues for keeping one-doctor practices thriving. Conversely, a small hospital faces unique challenges, and mitigating them will help keep those businesses successful and viable. And, of course, any changes they make must sync with pet owner needs and desires, which will shift, too.
One significant advantage of a small practice is that one person is in charge and sets the direction. The owner has the flexibility and creative freedom to make the practice reflect their vision and quickly bring all employees on board with it. In contrast, larger businesses can have layers of management and an out-of-touch board of directors, weighing down their flexibility to change with the times and meet client expectations.
Pet owners often perceive smaller hospitals as being more personal and family-oriented. At larger hospitals, clients might not see the same veterinarian or interact with the same team members from one appointment to the next. These clients might wonder whether anyone knows or remembers them or their pets. The result often is mistrust in the recommendations of the doctors and staff and a lack of stickiness in the client relationship.
Not all pet owners care about the detachment, but enough do, creating a niche for smaller practices in an era where businesses of all kinds seem to get bigger and more impersonal. Single owners have significant control in this area and can improve their practices through careful hiring, training and marketing.
It is often said that smaller practices are easier to manage — fewer employees, simpler processes and less bureaucracy — but it doesn’t mean they can ignore structure, policies and procedures.
A more personal environment also applies to how team members perceive their practice and their level of emotional connection. Greater employee engagement boosts profitability, client service and worker retention. Being small doesn’t mean a practice will automatically have a better culture, but creating one is often easier in a smaller organization.
Bumps in the Road
A critical benefit of owning a small hospital is the need for fewer non-doctor employees, which helps in today’s difficult hiring and retention environment. However, the flip side is that the practice often doesn’t have the human resource capabilities that larger hospitals enjoy. The temporary or permanent loss of a single employee can devastate a one-doctor practice. For that reason alone, smaller hospitals must be well-organized and operate more efficiently than larger ones.
Another disadvantage of owning a smaller practice is the challenge of attracting attention from manufacturers and distributors and not receiving volume discounts on medications, supplies and laboratory services. When it comes to inventory costs, these owners can join a buying group and negotiate lower prices and long-term contracts.
Being alone at the top of the pyramid can be difficult. Not having a colleague or compatriot to bounce ideas off of is tough, as is ultimately being responsible for owner, manager and doctor duties. One solution is to learn to be an effective delegator, focus on efficiency and be active in local veterinary organizations.
Owning a small practice comes with other disadvantages and few options for surmounting them. One hurdle is finding a replacement veterinarian if the primary doctor is ill or out for continuing education, vacation or another reason. Another is justifying an investment in more equipment or a larger building. Acquiring the equipment or space isn’t the issue; it’s seeing enough clients to make the investment worthwhile.
Conceptually, a relatively simple solution to all this is to hire a second doctor. Two-doctor clinics are likely the new small practice of the future. One more doctor eases many of the challenges we mentioned but still allows the business to retain its small practice culture and ambiance.
It’s Time to Think Differently
One-doctor practices don’t have to provide general services from a leasehold or standalone building. Today’s clients are more varied in what they want from a veterinary practice, which means a single doctor-owner is free to think differently and offer something new.
Especially in urban and suburban communities, many practitioners offer the same services and products and are open during the same hours. In fact, virtually all general practitioners provide almost precisely the same client experience.
So, how can you stand out in your community as a solo practitioner? How can you differentiate your clinic from the copycats? Just ask.
Author Jack Canfield, writing in The Success Principles, tells the following story:
When Dr. Ignatius Piazza was a young chiropractor fresh out of school, he decided to set up an office near California’s Monterey Bay. He approached the local chiropractic association for assistance but was advised to go elsewhere. The area had too many chiropractors, he was told.
Dr. Piazza knocked on residents’ doors from morning until sunset for months. After introducing himself as the new young doctor in town, he asked a few questions:
- “Where should I locate my office?”
- “Which newspapers should I advertise in to reach your neighbors?”
- “Should I open early in the morning or stay open into the evening for those with 9-to-5 jobs?”
- “Should I call my clinic Chiropractic West or Ignatius Piazza Chiropractic?”
Finally, he asked, “When I hold my open house, would you like an invitation?” If people said yes, he wrote down their names and addresses and continued on, day after day and month after month. By the time he finished, he had knocked on over 12,500 doors and talked to more than 6,500 people. He got a lot of nos, but he also heard enough yeses. During his first month in practice, he saw 233 first-time patients and earned an income of $72,000 — all in a place that supposedly didn’t need another chiropractor.
Do Your Homework
So, before you start a veterinary practice or look to buy an existing clinic, do your due diligence. Answer these questions:
- What are the community demographics?
- What are the community psychographics, such as values and attitudes?
- What are all the other local practices doing?
- What could I do differently regarding hours of operation, services, fees, technology and experience?
- What would I love to offer?
- Does the demand exist for what I want to offer, are enough pet owners willing to pay for the services, and would the revenue be enough to keep my practice afloat?
With all that information in hand, you need to mull different business models. Some aren’t right for you, but they aren’t all wrong. Some are nontraditional. However, each is a chance for you to do things differently to meet your needs as a solo practitioner and those of clients who want you and your team members to be their veterinary medicine providers.
Here are eight business models to consider.
1. House Call
While this model isn’t new or unique, it’s a growing niche for solo practitioners. Some provide a broad range of services, including diagnostics and surgery done in a mobile unit, and others are more specialized, such as focusing on end-of-life care and in-home euthanasia. Most of these practices are individually owned, but some are part of a general or specialty brick-and-mortar veterinary practice. This model works well for a single-doctor practice.
2. Limited Services
Do you have to be everything to everybody? Check your state’s practice act to see if you can open a business without a surgery suite, radiology room, in-house laboratory and isolation area. If you don’t like performing surgery, could you refer those patients to a colleague (boarded or non-boarded)? On the other hand, perhaps all you will do is surgery, either in your clinic or in a mobile vehicle. Decide which services you want to offer and which you would refer to another practice. It’s done in human health care all the time.
3. Wellness Only
Look at your local CVS MinuteClinic. Can you operate a wellness-only facility that focuses on vaccinations, external and internal parasite diagnosis and prevention, and other high-demand services? Would such a business model reduce overhead costs? Shrink your pharmacy? Allow you to charge less since you will need fewer employees and less space?
4. Affordable Care
Dr. Michael Dicks, previously with the American Veterinary Medical Association’s Veterinary Economics Division, called it “earns versus turns.” In other words, to make $1 million, you can have 1,000 client transactions at $1,000 each (earns) or 10,000 at $100 each (turns).
Pet owners are increasingly concerned about the rising cost of veterinary care, so you can attract more of them by incorporating affordable care into your business model. You have many ways to do it — from a broad spectrum of offerings at various price points to lower-cost wellness services. We know of a successful clinic that provides affordable wellness procedures but prices its sick-care services in the middle range of other practices.
The spectrum of care fits well with this practice model. Practices offering affordable services can generate as much profit as a higher-end hospital, but their structure and operations must differ.
5. Members Only
Concierge care in human medicine describes a relationship in which a patient pays the physician an annual or monthly fixed fee. To provide convenient services, most concierge doctors, whether primary care physicians or medical specialists, see fewer patients or set aside days when they see only their members. Those patients pay for conveniences like same-day appointments, 24/7 physician availability, unlimited office and telehealth visits, simple diagnostic and blood tests performed in the office, and no insurance copays. The patient can call the doctor directly to ask questions. If you have a significant health problem, the doctor coordinates specialist referrals and hospital care.
Models like that are popping up nationwide in veterinary medicine. Solo practitioners can see who they want to see.
6. Specific Breeds or Species
Feline, exotic and avian practices have been around for a while. Could a practice be so niche that it is breed-specific or sees only young, small or large dogs? A practice like that can develop a niche following with the owners of certain species and breeds.
7. Different Times
Generation Y veterinarians looking at practice ownership take lifestyle considerations into account. How can a business owner ensure a better work-life balance? What if the practice was open:
- From 8 a.m. to 5 p.m. four days a week?
- From 9 a.m. to 4 p.m. five days a week?
- From 5 to 10 p.m. four nights a week for urgent care only?
8. Space-Sharing
Commonly done in white-collar offices and hair salons, space-sharing is a viable option for doctors wanting a limited workweek and a place to call their own. Maybe one doctor works Monday, Tuesday and Wednesday and the other on Thursday, Friday and Saturday. In either case, one building hosts two businesses that may or may not share staff members and use the same equipment, supplies and drugs. This setup allows for two solo doctors to share space but remain independent. This business model requires a lengthy discussion between the space-sharers to work out the logistics, but it ensures freedom and life control.
Final Thoughts
What can a 21st-century single-doctor practice do to get ahead? Owning one is challenging, given all the work involved in being a manager, clinician and leader. You compete against larger practices that might offer all the traditional services. Does emulating what others do make sense? Or can you adopt a business model that meets or exceeds all the needs of the pet owners in your community? Can you build a profitable single-doctor business and scale it over time, making it more attractive to a buyer at some point?
Lots of questions here, but future-thinking entrepreneurs will discover the answers.
HAPPY OWNERS
According to the American Veterinary Medical Association, practice owners are more satisfied with their jobs, lifestyle, profession and compensation than associate veterinarians are. For example, according to the 2024 Economic State of the Veterinary Profession report, 75% of owners said they were “satisfied” or “very satisfied” with their lifestyle compared with 65% of associates.
ANOTHER MODEL
The veterinarian traditionally owns 100% of the business in a one-doctor practice. But does it have to be that way? What if the doctor took 50%, a credentialed technician owned 25% and a manager had 25%? Some states restrict non-veterinarian ownership, but in any case, the partners must be a good fit. Shared ownership can result in shared responsibility, shared work and shared wealth. Any business model that meets your needs and the pet owners’ is a good one.
PAPERWORK
The American Veterinary Medical Association found that 61% of U.S. veterinary practices were legally classified as S-corporations in 2021. Just over 18% were corporations, 11% were individual proprietorships, and nearly 9% were partnerships. Nonprofits and other non-corporate entities comprised the remainder.