Sam Walton, founder of Walmart, said: “Most overnight business successes are 20 years in the making.” In my 30-plus years’ experience, I find the same to be true of veterinary practices. In most cases, it takes time to grow a practice and implement the systems that make it financially successful. Running parallel to the growth of that business, your professional and personal development factors heavily into your success as a veterinary practice owner.
Having owned multiple practices, worked with hundreds of veterinarians and reviewed thousands of financials, I’ve observed the aspects of operating a business that set apart the most productive owners. Here are the top six traits I’ve seen in the most successful practice owners.
- Never stop being an entrepreneur. Every business owner starts out as an entrepreneur—an individual with an idea and the drive to bring it to fruition. What often happens, however, is that once the dream is realized, that entrepreneur settles into the day-to-day operations of running the business and forgets to continue innovating within the practice. I encourage all new (and not so new) practice owners to routinely step back from the practice and see it with fresh eyes. Identify aspects of your business that can be improved and tackle them with the same gusto you had when you first explored ownership.
- Purchase your practice sooner, rather than later. The most successful owners I observe usually start their ownership journeys as soon as they can, so they have a longer period to accumulate wealth as the practice grows and debt is retired. Ideally, three to five years post-graduation is the best time, as you’ve had the opportunity to solidify your medical and surgical skills to the point where you can confidently practice veterinary medicine and still devote time to operating a veterinary practice. It is never too late to own a veterinary practice, but remember that the more time you own, the greater the financial results can be at the end of your career.
- When possible, purchase the real estate for your veterinary practice. If that is not possible, invest in other income-producing real estate as a side business over and above owning your own home. Studies show that the No. 1 factor contributing to a family’s total wealth in the United States is property ownership. As my Uncle Ben, a professor emeritus of agricultural economics at the University of Tennessee, taught me over the years, you have three things working for you through real estate ownership:
1. Appreciation, which historically has been approximately 3% annually;
2. Depreciation, which is a gift from the government in the form of a non-cash expense on your tax return to account for the economic loss you experience on your property (buildings, equipment, etc.) as it ages, wears out and needs to be replaced; and
3. Cash flow, which should provide ongoing income that yields greater and greater cash flow to your bank account as (a) debt is retired over the life of your financing and (b) rental income from the property increases.
- Manage your debt, finances and savings wisely. Be a good steward of your finances, both personally and professionally. This applies to everyone. Live by the old maxim, “When your outflow of cash exceeds your inflow, there’s going to be trouble,” especially if it goes on for very long. To have a successful business, you first must make sure your personal finances are in good order. Live within your means and avoid bad debt or blemishes to your credit history that can adversely affect it. Reasonable student loan debt is not a detriment to you borrowing the monies for your business, but excessive debt related to depreciating assets such as cars, boats and furnishings—along with the lack of any significant savings—can doom your chances of borrowing resources to own a veterinary practice.
- Be a lifelong student, not only of veterinary medicine and surgery, but also of business finances and management. You must not only invest time and energy in continuous learning to be a top veterinary practitioner, but you must also continuously monitor and manage the daily, weekly and monthly financial reports needed to make the appropriate decisions on your practice’s overall operations. “If you don’t inspect, don’t expect,” so you not only need proper and timely financial reports but also to allocate the time necessary to review and understand them so you can make management decisions necessary to ensure your practice’s ongoing financial health. This is one area where I see the truly successful veterinary entrepreneurs investing in good accountants and consultants to set up and maintain the financial reporting that will allow for monitoring, growing and succeeding as a veterinary practice owner.
- Treat your time as your wealth, not your money. As a practice owner, it is easy to get caught up in the constant churn of being a practicing veterinarian and a business owner. But it does you little good to be the greatest veterinarian and business owner if the other aspects of your life are unsatisfactory. Successful professionals and business owners can often get caught in the trap that the more they work, the more they’ll accomplish—which is good to a certain point, but everyone needs to take time away from their profession and business. To lead a truly balanced life, you must devote the time and energy to enjoy friends, family, hobbies, travel, retirement and whatever brings you true happiness.
We often spend a lot of our time dreaming, planning, pondering, and talking about making a significant change, especially when it may be uncomfortable for us in the near-term. If you are considering practice ownership, then there has never been a better time to take the dive. Pets of all shapes and sizes continue to hold a greater place in our lives and hearts, so the opportunity to continue to provide love and care for them is growing daily.
Turn your “one day” into today and go forward with your dreams! Your local Simmons advisor can help you take the first step.
“Don’t die with your music still in you.” —Wayne Dyer
