Making Veterinary Decisions with Financial Clarity

Veterinary practices are almost always busy...but does the P&L reflect that?

In this episode of FlightPlan: Quick Consults, our panel explores the disconnect between how busy a practice feels and what the financials actually show. They discuss common issues like unclear responsibility across teams, inefficient use of technology, high payroll despite feeling understaffed, and rising inventory costs without products on the shelf.

The conversation also highlights how an accurate, well-structured P&L—aligned with the VMG/AAHA Chart of Accounts—helps practice leaders avoid reactive decisions and instead focus on trends, leading indicators, and clearer financial insight.

Host = Brenda Tassava Medina, CVPM, CVJ, MVLCE, President of Encore Veterinary Consulting

Panelists:

• Martin Traub-Werner, CEO at VetBooks
• Michelle Winter, CVPM, CVJ, VP of Operations at Encore Vet Group
• Katie Esposito, CVPM, Account Manager at Clarus Technology

Resources Mentioned:

• VMG AAHA Chart of Accounts - https://www.myvmg.com/knowledge-center/aaha-vmg-chart-of-accounts/

Thanks for listening!

Website: https://encorevet.com/

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Linkedin: https://www.linkedin.com/company/encore-veterinary-consulting

Transcript

SPEAKER_02 0:10

Welcome aboard. You're listening to Flight Plan Quick Consults, your go-to podcast for veterinary insights that are fast, focused, and designed to elevate your practice. I'm your host, Brenda Tasma Medina from Encore Veterinary Consulting. Whether you're between appointments or heading into a strategy session, we've got takeoff-ready tips, tools, and takeaways to keep your team soaring. So buckle up and let's chart today's course to making decisions with financial clarity. Today's panel includes Martin Traub Warner, Katie Esposito, and Michelle Winter. Martin, tell our listeners a little about yourself.

SPEAKER_00 0:46

Yeah, thanks, Brenda. I'm a lifelong entrepreneur, ended up in the veterinary space almost 15, more than 15 years ago. 15 years ago, about uh now, which feels like an impossibly long time ago. Um I uh started a business called Vet Success. It was the industry's first purpose-built uh data and analytics platform for veterinary practices. Um I uh exited that business in 2018 and uh joined VetSources um leadership team for about four years. And it was actually while we were doing that success that I stumbled on this uh problem. We were putting data in front of practice owners and they would say, you know, this is great visit data and revenue data and lapsing patient data, but can you tell me about my profitability? It's like, no, no, profitability, you know, we'd have to do your books and uh on accrual basis, following the aha chart of accounts and and touching books every month. And people were like, Well, you should do that. Wait, what? So started vet books, which is really become a passion project of mine because as I look at any financial success that that I've ever had or that any of my buddies and friends who own businesses have ever had, when they're in financial control, it um makes all the difference in the world. So that's what we're bringing to practices today.

SPEAKER_02 2:06

Thank you, Martin. Next up is Katie Esposito.

SPEAKER_01 2:10

Hello, thanks for having me, Brenda. Um, I have been in vet med for the majority of my life, starting in the kennel, working my way up to practice manager. I went and got an MBA and a CVPM and then moved into regional operations for about four years. And at the beginning of this year, I took an exciting step in a different direction and joined the team at Claris Technology. Um, felt like this company is really giving our industry a shot at providing more access to care, which is very near and dear to my heart. Uh, and personally, I have a 13-year-old pit bull who is the love of my life and four rescue kitties, and they do not live together in harmony. So that's me.

SPEAKER_00 2:57

Every day is an adventure, eh?

SPEAKER_02 3:00

Thank you, Katie. And then there's one of my favorite teammates, Michelle Winter.

SPEAKER_03 3:05

Yep, we get to work together every day. So, yes, Michelle Winter, and been a lifetime in this wonderful profession. I wouldn't change it for anything. The first job I had was scoop and poop in the kettle with the last job I have is hopefully the seat I'm in now. We'll see, vice president of operations at Encore Beck Group. Um, but my background is practice management and then the education pieces that go along with practice management, which has just been something that's led me to my current role, leading ops at Encore.

SPEAKER_02 3:34

Thank you, Michelle. Actually, Michelle, I'm going to start with you with our first question. Our listeners would really like to know what disconnects do you see most often between how busy a practice feels and what the PL actually shows.

SPEAKER_03 3:51

Yeah, that's that's something of a question to lead with, Brenda. It's a good one. Um, I think there's very few veterinary teams who don't think they're busy. And the truth is they all are. Everybody's busy. Like vetMed is a very busy profession. I think what I see as the most common disconnect is there's not a sense of responsibility behind who does what in the normal flow of appointments or normal workflows based on you know what services you're providing. That's the one part. So clarity in who's responsible for what. So you're not tripping over each other and like bumping into each other and you drop vaccines double for this appointment and nobody gets them for the next appointment. Like just clarity of responsibility is number one. But the second one, and a little more recent, is how can technology help with our workflows? Because I think people find themselves being in the center of the busy part of the practice and that they're needed there in that moment, in every moment. But oftentimes there's some way that technology could be bolstering that practice workflow, but it won't be introduced or accepted because somebody has built their sense of worth in the practice based on being the center of all those things. And I think there's a huge opportunity for a lot of veterinary teams right now to just sort of view it a little differently with a different lens.

SPEAKER_02 5:19

I agree with all of that. One thing that I thought of when you were with speaking about technology is I see a lot of practices teams layer technology on top of what they're already doing. And we're not getting more efficient doing that. Have you seen that? And what do you recommend around that?

SPEAKER_03 5:39

Well, yes. So I we have practices. I'll give you an example. We have practices who are adopting COVID, for example, for their doctor team to do faster EMRs. Guess what? They're just sort of like looking at what that said, and then they're typing it in. I'm like, you're missing the point. You missed it. This is this is your friend. Like, adopt it, go do it, go forth. Um, and I think that there's trust issues, obviously, with AI and that type of technology, but you can kind of see that happening in other ways too, in other areas of technology adoption.

SPEAKER_02 6:11

Yeah, yeah. I see it a lot at the front desk. Katie, same question to you. You've worked with a lot of different practices regionally. What disconnects do you see most often between how busy a practice feels and what the PL actually shows?

SPEAKER_01 6:27

Um, my two top issues I've seen, and I'm coming from a regional subset and a practice manager, but I see the payroll being really high on the PL, but feeling short-staffed is one issue. And the second is cogs are really high. We don't have anything on the shelf. And adding the technology piece that Michelle just spoke about really is a helpful piece in that payroll. So what I see is we feel really busy, likely due to inefficiencies that we have not figured out, um, not adding in the technology where needed or double dipping with it, having maybe toxic team members taking a paycheck and not pulling their weight. Um, and even things that like onboarding new team members, super important to do. We need to take the time to do it, but it does reduce who's on the floor, and others have to pick up the slack. So they feel busier than potentially the PL says they are. So I love a good PL, but we have to look at the whole picture. Um, and cogs are my next favorite thing. Um, so I think that this is an area that feels from a team standpoint, like we never have what we want and who's doing the ordering and what's going on. Um, and without a strong system and somebody that has the buy-in of the whole practice as to what we need to have versus what we must or what what we want to have on the shelf, we need to have a good system there and really work together to get those items because we can't carry everything at all times. Um, and those are the two biggest pain points I have found. Um, and yes, we're all busy. So streamlining anything we possibly can would be wonderful.

SPEAKER_02 8:12

Thank you, Katie. Martin, same question to you, but you're coming from a different perspective. What do you see as far as disconnect?

SPEAKER_00 8:21

Yeah, I come at it from a very different perspective because I dispassionately just look at the financials. I have no idea how busy the practice is, although I agree with both Michelle and Katie that everybody's busy, right? You ask somebody how are you? Oh, busy, busy, busy, busy, busy, busy, busy, busy. Um but I I don't know that one could correlate uh the relationship between a healthy PL and busy or not busy in the in the in the practice. Um the my approach to it is get your practice under financial control, understand the financial levers of success, um, rigorously follow the BMG AHA chart of accounts, uh, because that gives you the granularity to break down the elements of the practice uh and analyze them, and then make a plan. And then no matter how busy you are, work work work the plan, right? And and if the plan doesn't work, then plan better. It's like just keep like keep keeping don't chase squirrels. Don't that's right, that's right. No, you know, uh one of the one of the lovely charts that we put in front of our clients is uh we we list the top 10 revenue cogs and opex categories uh for every single month. And what I like to say is like, unl until you have those 30 categories, right? 10 10 revenue, 10 cogs, 10 op ex until you have those fully optimized and dialed in, like don't go focusing on other things. And if you are gonna focus on other things, at least have the intellectual honesty to tell yourself that I'm working on something that is not in one of my top 10 revenue cogs or opex categories. Um I I talked about you know there's there's money hiding in the couch cushions of the of the practice, and that that's where it is, right? It's it's in your it's in your top, it's in your top 10 categories. And so that that's a good place to start to stay focused. No matter how busy you are, we're all busy, everybody's busy. You can always you can always you can always make work, uh, but with with focus around the financial controls, you can be at least successful financially.

SPEAKER_02 10:39

Thank you very much, Martin. Um, Martin, I'm gonna I'm gonna have that parlay into the next question and start with you because I know that you're really passionate about having an accurate PL. So, how can that accurate PL prevent reactive decisions around staffing, pricing, or hours?

SPEAKER_00 10:59

Uh so uh, you know, the first thing is um you you I I feel I I'm so surprised at to that I I, of all people, have become the the uh evangelist for the BMG Aha Chart of Accounts. Um because because it's work, man. Like it's like it is detailed and rigorous and takes work.

SPEAKER_02 11:21

And it's been updated recently. So Melissa need to get their hands on that.

SPEAKER_00 11:26

And has been updated recently. Uh you can you can find the changes uh with a simple Google BMG Aha Chart of Accounts. You can learn about the changes. Um and uh, you know, as I mentioned earlier, it brings the granularity that lets you um uh start to analyze the and analyze the um the uh the practice. Uh there are 18 staffing accounts, uh 18 accounts that that labor gets put gets put into. And when you summarize those into sort of four big buckets, you know, DVM labor, uh management and client support, uh, other medical support, and other staff, uh, you can start to make a strategy around, you know, do we need to hire another DVM? Are we leveraging our vet techs enough? You know, maybe maybe hire two vet techs before you hire a DVM. Uh and you can start to plan and have those conversations and make those uh strategic decisions, but only when you know your numbers, right? You you might not like the numbers, but you've got it, you can they they've got to be done, done properly and done right.

SPEAKER_02 12:42

Absolutely. Michelle, what's your take on this? How can an accurate PL prevent reactive decisions around staffing, pricing, or hours?

SPEAKER_03 12:51

I think there's two ways. Um I'm I'm like Katie said, like I'm a big fan of a great PL. Like that's that's my dream. I love data. I love making data decisions and you know, data driven decisions. Um one of the things that I find really, really helpful in our PL structure is we've got a rolled up version and we've got a rolled down version. So the rolled up is what we call the big five. The big five is revenue, cost of goods, staff labor, vet labor, and evida. I want to see it fast and furious, right at the top of my PL. If I'm time-starved and working on a bunch of stuff and those five look good to me, I'm not probably gonna go any deeper. I might someday, but I don't need to today. And that allows me to prioritize my time and effort for what's needed in the practice. And maybe financials aren't what's needed at the practice. Maybe we need to work on culture, you know, things like that. Um but the other piece is I'm a big fan of I love a good PL, and that's a lag indicator. All that data is lag data. I'm a big fan of assigning a leading indicator to the things that you need for each of the big five and some of the other categories. And so often you find this might be shocking to some, but not for probably anybody on this call, is that revenue is often a leading indicator to many things in the practice. And so, like fixed expenses, if my daily revenue isn't hitting, my fixed expenses are going to be bad this month. Like, so when you know what leads you've got, you've got the ability then to make an impact on the lag. Without that, you're just going another 30 days and then you get your lag. And like that's not great for moving the needle. I'm a fan of moving the needle with leading indicators.

SPEAKER_02 14:43

Thank you, Michelle. Katie, accurate PLs and preventing reactivity. What are your thoughts?

SPEAKER_01 14:50

So I'm a little different than Michelle, but I do think that as an industry, we're very reactive overall. Um, and we don't do as much intentionally as we should. Um, that's the way we are. And having accurate data allows us to be intentional and make better plans for the future. I actually tend to discourage people from looking at the day-to-day. Don't get sucked into it. Let's look at the trends. We know it's winter, it's slower. Let's not freak out about it. Let's not make a decision based on this week, the week of Christmas. Maybe we wait and see because a week in the middle of the summertime is going to be very different. So I think my main takeaway from that is let's just try and be more intentional and set up systems. I like having systems that allow for us to trust the data we're inputting so we can trust it on a trend basis.

SPEAKER_02 15:43

I love a good trend line myself. So thank you all for being with us today. And thanks for flying with us on Flight Plan Quick Consults. If today's insights helped you climb to new heights, be sure to subscribe, leave a review, and share this episode with your crew. Until next time, keep your mission clear, your team aligned, and your practice soaring.