My Honest Advice For Someone Who Wants to Buy a Veterinary Practice

We're going to talk today about veterinarians and why maybe you should consider becoming a practice owner even if you maybe are a little bit afraid of that. I'm going to show you some of the reasons financially why this is one of the best decisions financially that you can make if you want to take the plunge. I'm going to go into what makes certain veterinary practices successful and why do so many veterinarian owned practices succeed and why is there still a space for doctor-owned practices in the face of huge corporate competition. So I'm going to show you this and more in this video and maybe you'll be inspired at the end to want to start or buy into a veterinary practice of your own. So if you look at buying a veterinary practice, the first point I'd make is not many veterinary inspirers start practice anymore and that's a big opportunity. So if you just think about the massive amount of corporate consolidation that's occurred in the veterinary space, it is a space that has just one or you know a small number of entities having an enormous amount of market purchasing power, an enormous amount of pricing power and you know that level of competition especially with higher incomes that a lot of those you know consolidations have have you know some of the some consolidations right have resulted in higher incomes from efficiencies and things like that. So a lot of veterinarians look at what they can make in a corporate practice and they say you know 150k a year you know why would I go to the trouble and risk of you know starting or buying into my own practice that seems like an unnecessary risk. So the reality is is because of so many veterinarians having that more like risk averse type of mentality that's also a huge opportunity for the folks that do want to do it because there's not as much competition for a you know mom-and-pop-owned practice out there compared to the corporates. And so you know why so many of these practices do succeed is you know a lot of things that big corporations have to do are not exactly something that you know somebody who's bringing their pet to see the veterinarian is going to be super excited about right. So I remember you know I've just talked to so many people that are practice owners and a lot of these practices succeed simply because somebody doesn't want to take their animal to a corporate-owned practice. People want to have somebody that they feel like is a member of the community that is not you know owned by a big chain and people can tell right just in the difference of the vibes of being in the practice like it is something that is is evident I think to a lot of the you know people bringing in their their pets to you know get veterinary care. I've seen a lot of practice owner veterinarians be successful by being differentiated and what I mean by differentiated is one practice owner in a very fast-growing community in Texas told me you know I looked around in my community and all the vet practices were corporate-owned and all of them were you know you walk in and there's this gigantic you know thing on the wall with a bunch of pet supplies and it smells like you know smells terrible and then the people at the front desk and they greet you don't really feel like they want to be there. The whole process feels very impersonal and if you think about veterinary medicine you know it is a discretionary good you know no one is required to take their animal in to get veterinary care and purchase veterinary care it is a discretionary good and so when that's the case you know a lot of times if you just simply provide a good experience if you just act like a human if you just act like a normal person that cares that can go leaps and bounds and can also make people a lot more engaged and wanting to spend money on veterinary care because they feel like that you care. So that's just a I've just seen over and over again a practice owner just comes in if you can find a community where there's you know very little mom-and-pop competition where you know you're either buying into a practice or you're starting one and you're doing that you know in a community that has enough income that it can support you know a veterinary practice where there's a need right if you can identify a problem I remember one veterinarian said that there in their town there you know there wasn't any kind of urgent care option at all and the people were having to wait you know hours in the emergency room to be able to get care it was just a terrible terrible experience for all around that person could go do a startup practice with an urgent care in a spot where they think there's opportunity and that will very likely succeed. So most businesses out there most banks rather they'll finance veterinary practices a lot of cases 100 of it finance and the reason is is this is not a pizza joint right this is something that has a very high likelihood of success and the reason why we don't see as many people doing you know veterinary practice is people are afraid about student loans people are afraid about you know what corporations right people are afraid about the unknown and a lot of people are just really risk averse staring down all these scary things that people are afraid to take on but having a practice will give you so many more options in life you will have so many more choices that you can enjoy and and you know one of the things to get started I would just say get $50,000 cash in the bank don't worry about your student loans get them on an income driven plan right something that at least just keeps them at bay while you focus on the dream and then you could get either you know conventional loan or you could compare that to like an SBA loan small business administration loan option and then just see you know what you know makes the most sense and you know definitely talk to a banker who's done a veterinary practice at least a few in the past so that you're you know not having to educate them and when you buy a practice it's kind of like what's the best word for it it's kind of like a forced savings mechanism let me show you now what I mean by that so let's just pretend that we're looking at when could someone afford to retire right so we're just going to say that somebody needs $120,000 a year to retire and let's just assume they have $200,000 in debt and they've got no and let's just say that they have no savings right so these sort of assumptions get to how many years it takes to retire so if we just the main thing to look at here is just the amount you're putting into wealth growth every year so just pretend that this is money that we're putting away to wealth growth every single year this is the total asset somebody has there's their loan amount there's their net worth this is income from investments so this is you know how you how much could you live off of based off the assets you have if you need $120,000 of passive income to retire then you just scroll down here to see when you finally surpass that number you have about three million of assets it's in you know about 44 years away now this is a really low amount of money to save let's just say that you know you are working as a corporate employee somewhere you're putting four percent into your 401k and that's kind of what's going on here now if I bump this savings rate up a little bit let's say in this scenario it's if you're saving 20,000 a year let's just say that you're putting aside you know some money for a house you're putting a little bit into your retirement that's it you're about 30 something years away from retirement now if you buy into a practice let's just say you buy a practice that's $500,000 right so that $500,000 practice you're going to have forced savings over a 10-year time frame of about $50,000 that you're going to be growing your wealth by just by paying down that practice loan and eventually when you have that practice loan paid off you're going to be able to sell it right so let's just say for a moment that you know instead of $20,000 of wealth growth a year that $20,000 you add $50,000 because you're making a lot more money so you're not making $120,000 to $150,000 anymore as a corporate employee you're making more money because you're capturing you know the owner percentage of that labor and not just the employee percentage so if we bump this number up to let's say it's like something along the lines of $70,000 this savings rate number doesn't really matter what matters is right here what is the absolute wealth growth that you're actually achieving so if I put in that you're saving about $70,000 a year which is reflected doing a little bit of into your 401k maybe paying a little bit of a mortgage and then having $50,000 a year of practice wealth growth you're able to now retire in 21 years instead of 44 so this is what I mean about becoming a practice owner why it's so valuable as a veterinarian you know just think about the fact that very few people are taking the risk because people are risk averse because everybody has student loans and everybody's afraid you don't have to be afraid so we can you know help you get over this fear just by math right looking at math it's the best antidote to fear because you think about what is your true downside what is the upside and it's enormous and I would just invite you to consume some other stories of successful veterinarians who have started their practice or bought into one or purchase one completely and just take a lot of that negative fear and just self-doubt and just say that that doesn't get to rule your life like if this is a dream you have you should go for it you should do it responsibly you should be careful about it but you shouldn't live in fear so I just want to encourage you and if you have any questions you can put them in the comments and thank you for following student loan planner I hope we can make more content like this that can help you be successful and excited about your possibilities as a veterinarian in the future.