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The Perfect Storm: Why Veterinary Practice Owners Must Reassess Strategy Now
Summary by VETSQUARED INNOVET
When you overlay BBVet’s three-year foot traffic survey data with the AAVMC enrollment trends highlighted by Matthew Salois, a stark reality emerges: veterinary practice owners are facing a simultaneous supply expansion and demand moderation that hasn’t been seen in modern veterinary medicine.
The Supply Side (AAVMC Data):
• DVM enrollment has nearly doubled from ~2,200 students in the early 1980s to 4,200+ today—a 90% increase
• Annual graduates have risen from ~1,900 to ~3,600-3,700
• Most expansion occurred post-2005, with acceleration after 2015
• This pipeline continues growing while market conditions have fundamentally changed
The Demand Side (BBVet Data):
• Transaction volumes declining and accelerating: -1.5% → -2.15% → -4.0%
• Revenue growth collapsing: 7.2% → 4.8% → 2.3%
• Fee growth power evaporating: 11.5% → 10.1% → 3.8%
• 56% of practices cite cost of living as their #1 challenge
• 25% identify lower veterinary demand directly
The Misalignment Problem
As Salois notes, this isn’t about suddenly having “too many veterinarians”—it’s about misalignment between rapidly growing supply, cooling demand, and a care delivery system that hasn’t improved productivity fast enough to absorb all that talent sustainably.
The BBVet data confirms this productivity crisis in real-time. Practices enjoyed boom conditions from roughly 2015-2021 where the rising tide lifted all boats. Double-digit fee increases masked operational inefficiencies. Transaction growth compensated for margin weakness. You could succeed just by showing up.
That era is over.
The Confidence Paradox
Here’s what makes this moment particularly dangerous: 71% of veterinary professionals remain optimistic about the industry’s future, and 58% are satisfied with their current performance.
This confidence isn’t wrong about the fundamentals—people love their pets, veterinarians are dedicated professionals. But it’s dangerously disconnected from the external economic forces now dominating practice performance.
It’s like being a skilled sailor optimistic about your abilities while ignoring the storm clouds gathering on the horizon.
Why This Demands Strategic Reassessment
The combination of these forces creates what I call the “supply-demand-productivity squeeze”:
1. More veterinarians entering the workforce each year
2. Fewer transactions per practice as cost-conscious clients delay care
3. Constrained pricing power as consumers push back on fees
4. No productivity breakthrough to absorb the talent sustainably
Without strategic intervention, this leads exactly where Salois warns: pressure on wages, margins, utilization, and clinician wellbeing.
The practices that will thrive aren’t those hoping for a return to boom conditions. They’re the ones fundamentally redesigning how they create and capture value in this new environment.
The Leadership Opportunity
This isn’t a crisis—it’s a clarifying moment that rewards strategic discipline over passive optimism.
The BBVet data points to four critical areas where practice owners must show up as better leaders:
1. Strategic Communication (Internal & External)
With Clients:
• Move from transactional interactions to trust-based relationships
• Demonstrate value proactively, not just when pricing increases
• Help clients understand the why behind recommendations
• Frame preventive care as financial protection, not optional expense
With Your Team:
• Be transparent about market realities without creating fear
• Involve staff in problem-solving around efficiency and value creation
• Align everyone around quality outcomes, not just activity metrics
• Recognize that burned-out teams can’t deliver the retention you need
2. Service Mix Optimization for High-Value Transactions
The days of undifferentiated growth are gone. You must intentionally design your service portfolio around:
• Margin analysis: Which services deliver genuine profit vs. consuming resources?
• Clinical impact: Which services create the best outcomes for pets?
• Client value perception: What do owners truly value vs. tolerate?
• Competitive positioning: Where can you genuinely differentiate?
Example: If low-margin nail trims are consuming staff time while profitable dental procedures are booked solid, you have a strategic resource allocation problem—not a capacity problem.
The goal: Fewer total transactions but higher value per interaction. This is how you maintain revenue and margins even as foot traffic moderates.
3. Workflow Efficiency That Preserves Quality
This isn’t about squeezing more out of exhausted teams. It’s about removing friction that wastes professional capacity:
• Eliminate administrative burden on clinical staff
• Use technology to match appointment complexity to staff capability
• Design physical workflows that reduce bottlenecks
• Deploy telemedicine strategically for stable follow-ups
• Automate repetitive processes that don’t require expertise
When Salois asks “how do we materially improve productivity so more veterinarians can be absorbed without margin pressure or burnout?”—this is the answer. Better systems, not longer hours.
4. Client Engagement & Retention Excellence
When acquiring new clients becomes more expensive and transaction frequency drops, retention becomes your highest-ROI activity.
But retention isn’t measured by “clients who came back last year.” It’s measured by:
• Care plan adherence: Do clients follow through on recommendations?
• Multi-visit continuity: Are you solving problems or just treating symptoms?
• Lifetime value growth: Is each client relationship deepening over time?
• Proactive engagement: Are you staying connected between crises?
As the transcript asks: “If loyalty isn’t just about how many times someone walks through the door, what new metrics do we need to track to measure genuine trust and continuity of care?”
That’s the fundamental question practice owners must answer.
The Bottom Line
Salois concludes by asking whether we’re planning for the demand environment of the past or whether productivity is the only thing standing between expansion and oversupply.
The BBVet data provides the answer: We are already in the transition. The productivity crisis isn’t coming—it’s here.
Success in this environment requires:
• Depth over breadth in client relationships
• Value over volume in service delivery
• Consistency over acceleration in growth expectations
• Strategic design over market dependency in business models
The practices that embrace this shift—that show up as strategic leaders rather than reactive operators—won’t just survive. They’ll capture disproportionate value as less disciplined competitors struggle.
The question isn’t whether the environment has changed. It demonstrably has.
The question is whether you’re willing to lead differently to succeed in it.
| The timing for strategic reassessment isn’t “soon”—it’s now.The data from both BBVet and AAVMC isn’t predicting a future challenge. It’s documenting a present reality that demands immediate, thoughtful response from practice owners who want to build sustainable, resilient businesses in this new landscape. |
If this article leaves you with questions you would like to discuss on how this might be affecting your practice – Lets Chat
References
1. BBVet Global Benchmarking – Rethinking Veterinary Practice Success in 2026 (Podcast Series)
2. Salois, M. (PhD) – “Are we quietly heading toward a veterinarian oversupply problem?” LinkedIn Post, December 2024
_______________________________________________
Dr. Larry van Niekerk
Founder & Veterinary Leadership Expert
Vetsquared Innovet
larry@vetsquaredinnovet.com | +64 27 6096744
www.vetsquaredinnovet.com
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