Veterinary Professionals Ride the Pandemic Wave
The coronavirus pandemic has drastically changed life and business for almost everyone. But for veterinarians, the pandemic caused a phenomenon similar to whiplash.
In March 2020, when the country went into lockdown mode, veterinarians saw their patient loads dry up almost immediately, as people canceled appointments and stayed home. Vets, like many professionals, wondered whether their businesses would survive.
But the longer people were stuck at home, the more interest in adopting and fostering pets grew exponentially. As more and more people adopted pets, shelters and pet stores emptied—and veterinary offices filled.
“The middle of March through April was a scary time,” says Mark Oganovich, Senior Vice President of Professional Services business banking at Old National Bank, who individually manages over 50 veterinary hospitals. “Our veterinary clients were calling and asking for help to survive the slowdown in business, and then several weeks later, many of them were having a record month. It’s really been a roller coaster ride.”
Tweaking the Business Model
To provide necessary services for existing clients and new pet owners, most vets have had to change the way they operate. While these tweaks have allowed veterinary practices to stay open and even grow their businesses during the pandemic, in many cases, they have also required reconfiguring staff and adopting new technologies.
For instance, instead of allowing pets and their owners to wait in a crowded waiting room, which won’t allow for appropriate social distancing, many vets instituted curbside service. That meant creating a policy for and educating clients to call, text, or otherwise check-in from outside the building and having staff to bring pets in from their cars. Some veterinarians chose to conduct visits at the curbside rather than inside the clinic.
More veterinarians began offering telemedicine visits, which allowed them to provide for healthcare needs via video or phone. “Telemedicine is pretty simple, the patient just needs an app on their computer or phone, and the hospital needs a computer device in the office,” Oganovich says. “It’s basically a Zoom call between the doctor and pet owner, so it’s just like an office visit but often quicker, and they don’t have to commute or wait for an appointment.”
Because telemedicine visits require less staff time, they are accommodating during the pandemic, when staff may be out due to illness or quarantine. Some vets believe clients will continue to demand video visits even after the pandemic, “especially the pet owners who are more comfortable with technology and want an answer now without having to wait,” Oganovich says.
Accommodating New Clients
The number of American households with pets was expected to increase 4 percent, from 68 million to more than 71 million, by the end of 2020, according to an August 2020 study. For veterinary clinics, that surge in pet ownership is good for business—but almost overwhelming at the same time.
“Meeting the demand is the biggest challenge right now,” Oganovich says. “That’s due to a significantly increased need for services at a time when offices are running at a decreased efficiency.” His clients say the increased demand is difficult to manage when you don’t have full use of your space's physical capacity; it continues to put stress on existing staff, while it remains challenging to find new employees, Oganovich says.
While veterinary visits and vaccinations for new pets have increased, other veterinary service lines have seen steep declines, such as boarding and daycare, Oganovich says. Veterinarians report a 50 percent decrease in boarding and a 30 percent decrease in daycare because of the pet owners working from home and still not traveling. Some vets have addressed staffing challenges by repurposing daycare and boarding employees to help with other clinic needs.
Preparing for the Future
Looking ahead, as COVID vaccines become more widely distributed and more Americans return to travel and other pre-pandemic activities, veterinary clinics expect their daycare and boarding figures to recover. “Many Millennial pet owners use pet daycare sort of like a gym membership or a getaway for their pets, so many of them are continuing to use it,” Oganovich says. “As we move further into 2021 and people start traveling more, we expect to see those figures and boarding figures to increase.”
The pandemic has brought ups and downs for veterinarians, but the industry has avoided the sharp declines many others have experienced. “Vet is a great industry to be in because when times are down, people are still going to take care of their pets like they would their child,” Oganovich says.
As more people become pet owners and veterinary clinics continue to experience high demand for their services, many are considering expanding their facilities or ancillary services. “Managing increased volume in a smaller hospital could be challenging, so some vets want to expand,” Oganovich says. “And as the passive income opportunities pick up, some are considering adding those additional services like daycare and boarding to service that newly expanded patient base. With business thriving, others may want just to remodel or buy new equipment.”
For most veterinarians, planning for growth requires a financing partner who understands their business and their specific industry's needs. “Purchasing a hospital or building one is a very different loan from a traditional business loan,” Oganovich says. “A financial partner has to understand the collateral, cash flow and be able to creatively design a loan to that client's specific need.
Old National is committed to assisting veterinary professionals through every stage of business growth.
This article was written by Old National's Professional Services Senior Lender, Mark Oganovich. To speak with Mark directly and learn more, connect with him at: Mark.Oganovich@oldnational.com.
